High foreclosure rates have started to return to the housing market. Perhaps it is high mortgage rates that make homes harder to sell. Perhaps it is inflation that has pinched household budgets. The city with the worst foreclosure problem last year was Cleveland, which is among the cities with the poorest populations in the country. (Check out every year’s mortgage rate since 1972.)
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The Year-End 2022 U.S. Foreclosure Market Report from real estate research company ATTOM noted that foreclosure filings (default notices, scheduled auctions and bank repossessions) hit 324,237, up 115% from 2021. The report points out that the number was nowhere near as brutal as in 2010, when the housing market was in the midst of a total collapse.
As well as analyzing city foreclosure rates, ATTOM looked at states. Those worse off based on the highest foreclosure rates in 2022 were Illinois, where 0.49% of housing units had a foreclosure filing. New Jersey followed at 0.45%, then Delaware (0.40%), Ohio (0.38%) and South Carolina (0.37%).
ATTOM looked at all cities with more than 200,000 people; that is, 223 metropolitan areas. Cleveland’s rate was 0.70%, followed by Jacksonville, N.C., and Atlantic City, both at 0.58%.
Cleveland is one of America’s old industrial cities, like Detroit and Toledo. Most of these cities grew with the auto industry surge from the 1920s through the 1970s. And most have lost half of their populations in the past half-century. They are left with a population with poverty rates above 20%, sometimes higher.
24/7 Wall St.Cleveland’s population was 914,808 in 1950. In 1921, that figure was 367,911 and falling. According to the Census Bureau, the poverty rate is 31.4%, almost three times the national average. The median household income is $33,678, about half the national average.
If poverty is an indication of the places foreclosures will rise this year, Cleveland will stay high on the list.
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