Modest income and stable market conditions in the following US cities make the prospects of mortgage borrowers, so badly affected during the crisis, a little brighter. Moreover, Many of the following markets are already on the verge of recovery.
Any American city could not completely avoid the problem , related to the subprime crisis and, Consequently, with the indiscriminate disposal of real estate. However, in some markets, the problem is not so obvious - boarded-up windows and whole neighborhoods of vacant apartment buildings found there is seldom enough.
According to Forbes, granted by the magazine Mortgage Lender Processing Services (LPS), lighter than other experienced mortgage crisis, these cities, which was not observed a sharp increase in property values in the pre-crisis years (in general, the national peak demand for real estate in the US fell for the second quarter 2006 of the year). As well as the city with a moderately growing economy, where the bulk of the inhabitants are so-called blue-collar workers - the production workers.
Mortgage crisis has almost no effect on the number of Texas cities (housing market there has never overheated), as well as former industrial centers, such as Buffalo (New York) and Harrisburg (Pennsylvania). These can be added, and the city of the US Central West, eg, Wichita (Kansas), and St. Louis (Missouri).
"In these markets it has never been a boom, so that, and drop them was particularly nowhere ", - says Michael Fratantoni, Vice President of the Mortgage Bankers Association Studies. "As for the Texas market, the situation there to save energy sector development, which is a stable source of employment, even during the economic crisis ", - adds the expert.
Recovery is yet to come
However, the slowdown in foreclosure in a particular city can not be considered indicative of the entire country. The government's efforts to limit the level of divestments and restructuring of non-performing loans, led to the emergence of a new group of "bad" loans (late on 90 days or more), that "burden" the market. And many of the borrowers only temporarily suspended the exclusion procedure. According to LPS, in 2009 by the people, who had overdue loans on hands, became less and less to start the procedure of foreclosure, trying to make payments, albeit behind schedule.
"In the American media often heard the phrase" alienation crisis "but the name is wrong. This is a crisis of non-payments, - says Ted Dzhadlos, Senior Executive Officer of Applied analysts LPS. - Alienation is merely a symptom. the important thing, how many people can not cope with the payment obligations ".
The smaller borrowers fall behind on payments, the greater the chance of recovery appears from the market. According to LPS, more than half expired, and then restructured credits eventually, about a year, lead to the alienation of real estate.
What lies behind the figures
In order to compile a list of cities with the best chances of recovery from the subprime mortgage crisis, in relation to the total number of loans issued in the largest cities in the US magazine Forbes took the LPS data on the percentage of disposals of non-payment. The lower this figure, the higher the rating of the city.
Then there was calculated a percentage of loans, for which the borrowers behind schedule payments for three months or more. More than half of these loans will eventually lead borrowers to foreclosure, so the less of such loans, the less disposals. In those cities, where the percentage of "bad" loans is relatively low, divestments wave, flooded the market will come to naught soon enough.
Finally, to evaluate, many borrowers cope with credit commitments and how many are already beginning to fall behind, Forbes magazine took advantage of the so-called indicator of the deterioration developed LPS. This indicator is derived from the percentage of loans, which "tend" to lag behind schedule to the "healthy" loans. For example, "Deterioration rate" coefficient in 2,5, means, that every "healthy" credit accounts 2,5 "Bad". In other words, less than, "Index of deterioration", the higher place in the ranking is the city.
The final list of cities, with the best opportunities for overcoming the crisis it was based on averaging all of the above indicators.
Stability – restore the pledge
It brings together the top 20 markets, Forbes selected, one factor - the geographical, rather, the absence in the TOP of certain regions of the country. Almost half of the cities hardest hit by the mortgage crisis is concentrated in California, Florida, Nevada and Arizona. So that none of them hit the top 20.
Alienation for non-payment are widely distributed throughout the North-East, West and South of the United States. Thus, Knoxville (Tennessee) and Rowley (North Carolina) almost hit by foreclosures and have, experts predict, emerge from the crisis with "strengthen" markets.
residential real estate segment in most US coastal cities proved unsustainable, since the land for new construction in these areas is extremely limited, the market is supply deficit, and house prices are formed by various factors besides inflation and construction costs. However, some places on the coast, such as Portland, Oregon (14 the list), could stem the tide of foreclosure due to stable and successful economy. Only 1,6% local loans eventually moved to the exclusion of non-payment.
"In fact, Portland thrives demographic boom, - says Michael Fratantoni. - There attracts a huge number of young people, since recently the city acquired the status of the technological center of the USA ".
Factor of "blue-collar"
It may seem strange, but cities with relatively low levels of family income, like Wichita, Kansas (the average household income is there only $40,101 in year, eg, in San Diego, the figure is $75,035, and in Honolulu - $71,361), successfully managed to resist the mortgage crisis. Overdue loans and a wave of foreclosures due to non-payment of mortgage struck more expensive markets. The thing is, that affordable housing is subject to certain government programs, which leads to a more rapid recovery of the market.
"In many markets available first home buyers enough, - says Michael Fratantoni. - A US federal program this type of buyers mortgage loans at very low interest rates and a program to alleviate the tax burden ".
In fact, a list of conurbations, most successfully opposing the mortgage crisis, but the main thing is not even that. Forbes rating allows to give the most objective assessment of the "health" of the US economy, excluding the unpredictable "real estate bubble", since the markets, considered by Forbes magazine, there was no sharp ups, or crushing falls.
"It is stable, healthy markets, - says Ted Dzhadlos. - It is on them, investors should pay attention ".
interest loans, late on 90 or more days
interest loans, which was expropriated property
"The indicator of deterioration", As of October 2009
"The indicator of deterioration", As of October 2008
Percent change "deterioration" in the year on year
Austin-Round Rock, Texas
Buffalo-Niagara Falls, New York
Rowley Carey, North Carolina
Sirakuzы, New York
Salt Lake City, Utah
St. Louis, Staten Illinois
Rochester, New York
Author: Francesca Levy (Forbes)
Transfer: Nikolai Strelnikov
A source: prian.ru