Zombie Attack!! (Foreclosures, that is)
New foreclosure filings are down to pre-recession levels. But the blight of abandoned homes in foreclosure — so-called ‘zombie properties’ — hasn’t improved. According to data released by RealtyTrac, 21 percent of homes in foreclosure nationwide in February had been vacated by the owner—unchanged from one year earlier. The rate was 30 percent or higher in distressed real estate markets in states such as Michigan, Nevada and Alabama. The average amount of time nationwide that an owner-abandonned home sits in the foreclosure process—without being repaired, put on the market and resold—was 1,031 days, or nearly three years.
“They’re sitting vacant,” said RealtyTrac vice president Daren Blomquist of these so-called zombie properties. “The bank is not claiming responsibility, the homeowner is not claiming responsibility, the property is falling into disrepair. The property taxes aren’t being paid. So it’s causing an eyesore in the community, and also potentially dragging down home values of surrounding properties.”
University of Arizona law professor Brent White said there’s an even worse problem for the housing market right now: “Hundreds of thousands of bank-owned properties that are similarly ‘zombie properties,’ for which banks have foreclosed and then just let the properties sit there.”
States with the most and least number of ‘zombie properties’ (i.e., owner-vacated properties in foreclosure):
1. Florida
2. Illinois
3. New York
4. New Jersey
5. Ohio
6. California
7. Indiana
8. Pennsylvania
9. South Carolina
10. Nevada
…
42. Alaska
43. Nebraska
44. Wyoming
45. Arkansas
46. South Dakota
47. West Virginia
48. Mississippi
49. Montana
50. District of Columbia
51. Vermont
…
Some Metro Areas with a High Percentage of Properties in Foreclosure that are ‘Zombies’ (i.e., owner-vacated):
Salem, Oregon — 48%
Flint, Michigan — 39%
Ocala, Florida — 39%
Peoria, Illinois — 39%
Des Moines, Iowa — 35%
St. Louis, Missouri — 33%
Las Vegas, Nevada — 33%
Indianapolis, Indiana — 33%
Port St. Lucie, Florida — 32%
Binghamton, New York — 32%
(Source: RealtyTrac, February 2014 U.S. Foreclosure Market Report)
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