East Coast and Illinois Have Highest Concentrations of Housing Markets Vulnerable to Coronavirus Impact
Majority of the 50 Most Vulnerable Counties in Second Quarter of 2020 Located in States Spanning Connecticut through Florida and in Illinois; Chicago, New York City, Baltimore and Washington, D.C., areas Have Clusters of Counties in Top 50; West Region Less at Risk of Housing-Related Issues
IRVINE, Calif. — July 10, 2020 — ATTOM Data Solutions, curator of the nation’s premier property database and first property data provider of Data-as-a-Service (DaaS), today released its second-quarter 2020 Special Report spotlighting county-level housing markets around the United States that are more or less vulnerable to the impact of the Coronavirus pandemic. The report shows that areas most at risk in the second quarter sat on the East Coast and in northern Illinois – with clusters in the New York City, Chicago, Baltimore and Washington, D.C., areas – while the West had the fewest.
The report reveals that a stretch of states running from Connecticut through Florida, plus Illinois, had 43 of the 50 counties most vulnerable to the economic impact of the pandemic. They included 11 suburban counties around New York City, seven in the Chicago, IL area, five around Washington, D.C. and four around Baltimore, MD. The only four western counties were in California, with none in other West Coast or southwestern states.
The East Coast pattern continued a trend identified in the first-quarter 2020 report, with variations from state to state. The previous report found that New Jersey and Florida had 24 of the top 50 most at-risk counties, Maryland had two, Illinois five and California only one.
Markets are considered more or less at risk based on the percentage of homes currently facing possible foreclosure, the portion of homes with mortgage balances that exceed the estimated property value, and the percentage of local wages required to pay for major home ownership expenses.
The conclusions are drawn from an analysis of the most recent home affordability, home equity and foreclosure reports prepared by ATTOM. Rankings are based on a combination of those three categories in 406 counties around the United States with sufficient data to analyze. Counties were ranked in each category, from lowest to highest, with the overall conclusion based on a combination of the three ranks. See below for the full methodology.
The findings surface amid signs that home-price growth stalled across significant parts of the country in May 2020, with more expensive areas of the West among those getting hit hardest.
“Home-sales data from around the country is starting to show that eight years of price gains may be coming to an end amid the economic damage flowing from the virus pandemic. It’s still too early to make any definitive calls, but the latest numbers show storm clouds gathering over the market,” said Todd Teta, chief product officer with ATTOM Data Solutions. “With this second special report on the potential impact of the pandemic, we see pockets around the country that appear more or less poised to withstand downward pressure on prices and other market conditions. Over the next few months, enough data should come in to tell us how things will most likely pan out.”
Most vulnerable counties clustered around New York City, Chicago, Baltimore and Washington, D.C.
A majority of the 50 U.S. counties most at-risk in the second quarter of 2020 from housing-market troubles connected to the pandemic (from among the 406 counties included in the report) were in the metropolitan statistical areas around New York, NY, Chicago, IL, Baltimore, MD, and Washington, D.C.
They included 11 in the New York City suburbs: Bergen, Essex, Hunterdon, Middlesex, Sussex and Union counties in New Jersey, plus Nassau, Orange, Rockland, Suffolk and Westchester counties in New York. Another seven – Cook, De Kalb, Du Page, Kendall, Lake, McHenry and Will counties – were in and around Chicago.
Five counties in and around the Washington, D.C. metro ranked in the top 50 most at-risk, including Charles, Prince George’s and Frederick in Maryland, and Spotsylvania and Stafford in Virginia. Four were in the northeastern part of Maryland: Baltimore, Carroll, Cecil and Harford counties.
Among others in the top 50 were five of Connecticut’s eight counties, including Litchfield, Middlesex, New Haven, Tolland and Windham counties.
The only western counties among the top 50 most at risk from problems connected to the Coronavirus outbreak were Humboldt County, CA, in the Eureka metropolitan statistical area, Madera County, CA (outside Merced), Riverside County, CA (outside Los Angeles) and Shasta County (Redding), CA.
Higher levels of unaffordable housing, underwater mortgages and foreclosure activity found in most-at-risk counties
Major home ownership costs (mortgage, property taxes and insurance) consumed more than 30 percent of average local wages in 43 of the 50 counties most vulnerable to market problems connected to the virus pandemic in the second quarter of 2020. They included Westchester County, NY (outside New York City) (77.1 percent of average local wage required for major ownership costs), Rockland County, NY (outside New York City) (71.1 percent of wages); Nassau County, NY (outside New York City) (63.4 percent); Riverside, CA (outside Los Angeles) (62.5 percent) and Bergen County, NJ (outside New York City) (58.5 percent).
In 36 of the 50 most at risk counties, at least 15 percent of mortgages were underwater in the first quarter of 2020 (with owners owing more than their properties are worth). Those with the highest underwater rates within those top 50 counties included Sussex County, NJ (outside New York City) (39.2 percent); Monroe County, PA (outside Wilkes-Barre) (36.3 percent); Cumberland County (Vineland), NJ (35.7 percent); Livingston County, LA (outside Baton Rouge) (34.3 percent) and Saint Clair County, IL (outside St. Louis, MO) (34.2 percent).
More than one in 750 residential properties faced a foreclosure action in the first quarter of 2020 in 47 of the 50 most at-risk counties. Those with the highest rates included Cumberland County (Vineland), NJ (one in every 180 properties facing possible foreclosure); Sussex County, NJ (outside New York City) (one in every 210); Camden County, NJ (outside Philadelphia, PA) (one in every 231); Atlantic County (Atlantic City), NJ (one in every 293) and Will County, IL (outside Chicago) (one in every 294).
Counties least at-risk concentrated in Colorado, Oregon, Texas and Wisconsin
Twenty-six of the 50 least-vulnerable counties from among the 406 included in the report in the second quarter of 2020 were in Colorado, Oregon, Texas and Wisconsin. The largest included Harris County (Houston), TX; Dallas, Tarrant and Collin counties, all in the Dallas-Fort Worth metro area, and Travis County (Austin), TX.
Lower levels of unaffordable housing, underwater mortgages and foreclosure activity found in less-vulnerable counties
Major home ownership costs (mortgage, property taxes and insurance) consumed less than 30 percent of average local wages in 19 of the 50 counties least at-risk from market problems connected to the virus pandemic in the second quarter of 2020. They included Winnebago County (Oshkosh), WI (18.6 percent of average local wage required for major ownership costs), Benton County (Rogers), AR (21.1 percent of wages); Racine County, WI (outside Milwaukee) (21.4 percent); Sheboygan County, WI (21.6 percent), and Monroe County, MI (outside Detroit) (22.7 percent).
Less than 15 percent of mortgages were underwater in the first quarter of 2020 in all but one of the 50 least at-risk counties. Those with the lowest underwater rates included San Mateo County, CA (outside San Francisco) (2 percent); Chittenden County (Burlington), VT (3.6 percent); King County (Seattle), WA (4.5 percent); Dallas County, TX (4.7 percent) and Washington County, OR (outside Portland) (4.9 percent).
Less than one in 750 residential properties faced a foreclosure action in the first quarter of 2020 in all 50 of the least at-risk counties. Those with the lowest foreclosure rates included San Mateo County, CA (outside San Francisco) (one in 12,566 properties facing possible foreclosure); Washington County, WI (outside Milwaukee) (one in 6,259); Chittenden County (Burlington), VT (one in 5,755); Eau Claire County, WI (one in 5,471) and Yolo County (Sacramento), CA (one in 4,306).
The ATTOM Data Solutions Special Coronavirus Market Impact Report is based on ATTOM’s first-quarter 2020 residential foreclosure and underwater property reports and second-quarter 2020 home affordability report. (Press releases for those reports show the methodology for each.) Counties with sufficient data to analyze were ranked based on the percentage of properties with a foreclosure filing during the first quarter of 2020, the percentage of properties with outstanding mortgage balances that exceeded estimated market values in the first quarter of 2020 and the percentage of average local wages need to afford the major expenses of owning a median-priced home in the second quarter of 2020. Ranks then were added up to develop a composite ranking across all three categories. Equal weight was given to each category. Counties with the lowest composite rank were considered most vulnerable to housing market problems. Those with the highest composite rank were considered least vulnerable.
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