Two national market reports released today carried a singular message. The nation's heartland is now the focus for price declines, no longer the South or West. From Milwaukee to Columbus, REO foreclosures are increasing and prices are falling.
In the Northeast, South and West regions prices actually improved at rates under one percent on a quarter-over-quarter basis but the Midwest suffered deeper depreciation in prices over quarterly and yearly timeframes., according to Clear Capital's April Home Data Index Market Report.
However, the Midwest lost -2.7 percent of its value over the quarter, which is the fifth month of declines for this beleaguered region. Despite mild winter weather and an early spring, it wasn't enough to kick off a home buying season in this region.
Midwest year-over-year performance posted a loss of -4.0 percent, which is deeper than last month's yearly loss of -3.8 percent; it's not exhibiting any sign of finding a foothold for recovery like the other geographies. At that same time that the region's REO saturation increased 6 percent over last quarter as its prices, as measured by the Clear Capital HDI index, fell -2.7 percent.
Clear Capital's list of lowest performing MSAs included five from the Midwest. The Milwaukee MSA is the hardest hit market this month with a dramatic quarterly loss of -12.5 percent. This loss is five percentage points deeper than the second hardest hit MSA, Columbus, OH, which posted a loss of -7.5 percent. Other Midwestern cities among lowest performers were Detroit, down -4.2%, Chicago down -1.0 percent and St. Louis, down -0.7 percent.
In CoreLogic's Foreclosure Report, also released today, the top market for delinquent mortgages was Chicago, where 10.5 percent of all mortgages are mow 90 days of more delinquent. Its foreclosure inventory, 6.4 percent of all mortgages, is more than twice the size of Los Angeles, the second worst major market for delinquencies.
Of the top 100 markets, measured by Core Based Statistical Areas (CBSAs) population, CoreLogic found that 35 are showing an increase in the year-over-year foreclosure rate in March 2012, two more than in February 2012 when 33 of the top CBSAs were showing an increase in the year-over-year foreclosure rate.