Lenders repossess 43 Tri-Cities properties in January

Tri-Cities foreclosures were down in January compared to last year and down from December filings.

According to Attom Data Solutions January Foreclosure Activity Report, there were 65 foreclosures in the five local counties monitored by the report. Sullivan County saw the most notices of trustee sales and repossessions (REO)  as it did January last year and in December.

Here’s how January’s total foreclosure activity looked compared to January last year.

Carter – 7, down 1.

Unicoi – 2, down 3.

Washington – 23, down 1.

Hawkins – 3, down 8.

Sullivan 30, down 2.

Here’s how January’s new filings looked broken down by filing type:

Carter – Notice of trustee sale 3, REOs 4.

Unicoi – Notice of trustee sale 1, REO 1.

Washington – Notice of trustee sale 7, REO 16.

Hawkins – Notice of trustee sale 1, REO 2.

Sullivan – Notice of trustee sale 10, REO 20.

Nationwide foreclosure activity in January decreased on a year-over-year basis for the 28th consecutive month. Lenders repossessed through foreclosure 26,597 properties, up 6% from December but 17% below the January 2016 total.

More homeowners leverage equity, underwater mortgages hit 4-year high

One of the final reports for 2017’s housing market shows that local homeowners who were best positioned increasingly leveraging their equity. At the same time, the number of seriously underwater mortgages signaled the highest Q4 mortgage stress levels in four years.

At the end of Q4, there were 23,483 equity-rich properties in the Tri-Cities region, down from 28,117 in Q4 2016. On the other end of the spectrum, there were 10,507 seriously underwater properties, up from 8,773 last year.

Both items are part of Attom Data Solutions’ 2017 Year-End Home Equity and Underwater Analysis.

The number of properties classified as equity rich – they have a loan to value of 50% or less – declined in every jurisdiction in the Tri-Cities region with the exception of Johnson and Washington Co. VA.

Nationwide the share was 25.4%, up from 24.6% a year ago. That was the smallest year-over-year increase since Q3 2015, according to Attom.

Even though there was a lot of leveraging that drove the share of local equity-rich properties lower, every local jurisdiction except Bristol VA had a higher share than the national share last year.

Share of equity-rich mortgaged properties.

The largest year-over-year decline was 7% in Sullivan Co. While the report doesn’t show is what homeowners were leveraging their equity for it’s a safe assumption many were buying new homes – trading up or scaling down for retirement. Sullivan has consistently had some of the highest equity rich proportions of mortgaged property in NE Tennessee. The highest was 38% in Q1 2014. Compared to Q4 that was a 10% decline, or 931 properties.

Share of mortgaged properties that are seriously underwater.

Johnson County’s share of equity-rich properties is one of the most consistent in the region. It has dropped below 30% twice since 2014 and peaked at 36% in Q1 2017. Its Q4 year-over-year decline was second only to Sullivan.

Hawkins and Unicoi counties were the only examples of the share of equity-rich properties showing a year-over-year increase.

Attom’s report says 9.3% of U.S. properties with a mortgage were seriously underwater at the end of Q4. Seriously underwater is defined as a property for a loan-to-value of 125% or more. Attom says it was the smallest year-over-year decrease since it began tracking in Q1 2012.

Here in the Tri-Cities, the share of underwater mortgaged properties increased in every jurisdiction. The largest increase came in Johnson Co. Its share of underwater properties is the highest in four years.

Sullivan Co. had the next biggest increase. Its Q4 share was also the highest in four years.

The actual number of seriously underwater properties in the region has been steadily increasing for the past four years. At the end of Q4 2014, it was 8,233 properties compared with 10,507 Q4 last year. It’s not a huge factor in the larger housing economy, but it does signal some signs of increasing economic stress among property owners.

 

 

Tri-Cities home builders scramble to meet new demand

Homebuilders across the Tri-Cities are the busiest they have been since the recession. New residential permits were up 12% last year in the seven counties monitored by The Market Edge and the outlook for this year is 7% growth. New residential permits have increased for past three years, but permit performance is 61% less than what it was at the pre-recession peak.

Travis Patterson, Patterson Homes in Kingsport, like other local builders was watching the weather the last week of February. He said he was ready to start on 15 spec and custom homes as soon as it’s dry enough start site preparation. That’s just one example of the pace of new home building as the region enters the New Year.

The Market Edge’s annual report shows new permit growth in every NE Tenn. county except Carter, Hawkins and Washington Co. Va. But since the annual permit report is a lagging indicator, it doesn’t always reflect current market conditions. For instance, Hawkins Co. is seeing new home growth and local governments are looking at offering additional incentives to builders to pick up the pace. That’s being driven by job creation at Phipps Bend. And according to the Tennessee State Data Center, Hawkins is among the counties in the region where the population is expected to grow this year.

Here’s how the annual new permits look in compared to the 2016 totals.

  • Carter – 89, down 4.
  • Greene – 111, up 3.
  • Hawkins – 25, down 43
  • Sullivan 269 – up 33.
  • Washington Co. Tenn. – 425, up 123.
  • Scott Co. Va. – 30, up 9.
  • Washington Co. Va. – 72, down 12.
  • Region – 1021, up 109.

Last year’s new permit growth was the slowest annual growth rate since 2015 when year-over-year permits increased by 17% (138 permits). The 2016 growth was 13% (106 permits) and last year’s growth dropped to 12% (109 permits).

Compared to the other metro areas in East Tennessee, last year’s local new permit performance lagged Knoxville by 5%. Since permit growth in Chattanooga was flat the Tri-Cities’ 12% growth looked strong. But even with a flat year-over-year performance, Chattanooga had a little more than twice the number of new permits than the Tri-Cities.

There are several drivers of the increased local new home demand.

  • Two years of record tight inventory in the existing home market has made the new home market more attractive to buyers.
  • Good economic reports are increasing consumer confidence which continues to release some pent-up demand.
  • There’s more new home for buyers in 55-years-old and older market being built.

Patterson says his firm is seeing some good results in that market niche. He said he’s having a lot of success with two and three-bedroom one-level spec homes in Chase Meadows. Eastern Eight is also progressing on its new homes targeted to first-time and low-income buyers. That squares with reports from the National Homebuilders’ Assn. that builders are turning their attention to the demand for first-time buyers more affordable housing.

There was also an increase in high-end homes last year.

The Market Edge defines high-end homes as those that are 4,000 sq. ft. or more or have a construction cost of $400,000 and up. Washington Co. Tenn. still dominates that part of the new home market. Here’s how those permits looked last year compared to the 2016 totals.

  • Carter – 5, up 3.
  • Greene – 5, unchanged from 2016.
  • Hawkins – 0, unchanged from 2016.
  • Sullivan – 19, down from 2.
  • Washington Co. Tenn. – 36, up 13.
  • Scott Co. Va. – 2, up from 0 in 2016.
  • Washington Co. Va. – 22, down 4.
  • Region – 89, up 12.

Dale Akins, president, and CEO of the Market Edge, projected 7% new Tri-Cities permit growth during a meeting with Kingsport Home Builders Association earlier this year. Akins is considered the best resource for building permit information in the region and his projects have been spot on for the past several years. The takeaways from his presentation were employment is up, but still below pre-recession levels, population growth is slow that increased apartment construction slows housing market demand.

The State Data Center’s population projections for this year is for slow growth – up almost 1,400 –  led by Washington Co. Tenn.  Projections for this year are:

Washington Co. up 1,288.

Greene Co. up 254.

Unicoi Co. up 24.

Hawkins Co. up 20.

Johnson Co. up 3.

Sullivan Co. down 7.

Carter Co. down 140.

The Census Bureau’s population projections, which include the number of deaths, births and migration won’t be available until mid-year.

 

Tri-Cities sees more 2017 foreclosure sales than before recession

There was a time when the first words out of a prospective buyer’s mouth when they linked up with a Realtor was “what kind of foreclosures are out there?”  Those days are gone, but there’s still an active foreclosure market. In fact, there were more foreclosure sales in the Tri-Cities region last year than there were in 2008 – the year before the Great Recession hit the local economy.

According to Attom Data Solution’s Year-end Foreclosure Report foreclosures hit a 12 year low in 2017. That not the case here in the Tri-Cities region. According to Attom’s report, there were 610 foreclosure sales in the Tri-Cities region last year. That’s 9% of all residential resales that year and a decrease from 2016 in all but two local markets. There were four more in Bristol VA and two more in Scott County.

Compared to the peak foreclosure sales years of 2010 and 2011 last year’s foreclosure sales were down a little more than 50%.

But looking back to some pre-recession years last year’s NE Tenn. total was 27 more than 2008 and 222 more than the 2007 total.

Sullivan and Washington counties accounted for the increase in Northeast TN while all of the Southwest VA jurisdictions saw increases.

Attom’s report shows 676,535 properties with foreclosure filings in 2017 represented 0.51% of all U.S. housing units, down from 0.70 percent in 2016 and down from a peak of 2.23% in 2010 to the lowest level since 2005. The share is about the same here when compared to total households.

The report also includes new data for 2017, when there were 64,651 U.S. properties with foreclosure filings, up 1% from the previous month but still down 25% from a year ago — the 27th consecutive month with a year-over-year decrease in foreclosure activity.

“Thanks to a housing boom driven primarily by a scarcity of supply, which has helped to limit home purchases to the most highly qualified — and low-risk — borrowers, the U.S. housing market has the luxury of playing a version of foreclosure limbo in which it searches for how low foreclosures can go,” said Daren Blomquist, senior vice president at Attom Data Solutions.

 

 

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