THE FORECLOSURE CRISIS

1. THE FORECLOSURE CRISIS BAY AREA CASE STUDY

2. Overview • Research Focus • Neighborhood Stabilization Program (NSP) • Bay Area Demographics • Foreclosures in Bay Area • Areas Needing Assistance • Take Aways • Geographic Information System (GIS) Skills • Data Sources • Photo Credits

3. Research Focus • Focus: U.S. Department of Housing and Urban Development (HUD) Neighborhood Stabilization Program (NSP) • Case study: San Francisco-Bay Area • Research question: what areas have the greatest need for foreclosure assistance?

4. Note: State of California funding excluded. NPS invested $7 billion of federal funds to mitigate “the impact of foreclosures through the purchase and rehabilitation of foreclosed, vacant properties in order to create more affordable housing and renew neighborhoods devastated by the economic crisis.”

5. NSP Summary • Created by the Housing and Economic Revitalization Act of 2009 (HERA) • Three rounds of NSP funding; two rounds of funds distributed by a formula and one round was a competitive application process • States, counties, cities, and nonprofits use NSP funds to purchase and/or rehabilitate foreclosed, blighted, or vacant properties • Households assisted must be 120% of area median income (AMI) and 25% of the grant must serve households below 50% AMI

6. Source: 2011 U.S. Dept. of Housing and Urban Development

7. Source: 2000 U.S. Census Data Nine Bay Area Counties: • One of the areas hardest hit by the foreclosure crisis • Four counties received NSP funds: Alameda, Contra Costa, Santa Clara, and Solano • Five counties were not funded: Marin, Napa, San Francisco, San Mateo, and Sonoma

8. Bay Area Demographics • 2005-2009 American Community Survey Data: • Total Population • Minority Population • Families Below Poverty Level • Median Household Income • Median House Value • Median Gross Rent

14. Bay Area Housing Data The Bay Area is expensive: • Bay Area residents earn 25% more than other Californians • Home values in the Bay Area are 29% higher than other places in California Source: 2005-2009 American Community Survey Data

15. HOUSE VALUES: • CA median house value $479,200 • Bay Area median house value $617,441 • Bay Area house values average $138,241 (29%) higher than CA • RENT: • CA median rent $1,116 • Bay Area median rent $1,273 • Bay Area rents average $157 (14%) higher than CA • Note: some areas have no renters and are categorized as $0 rent areas

18. Where is the greatest need? Variables to identify need: • High number of foreclosures • High number of delinquent mortgages • High percentage of house price decrease • High percentage of unemployment Source: June 2009-2010 U.S. Dept. of Housing and Urban Development Data

19. 21,000 foreclosures and 34,000 delinquent mortgages in the Bay Area in 2010 • Contra Costa and Alameda counties had the highest number of foreclosures and delinquent mortgages • Source: June 2009-2010 U.S. Dept. of Housing and Urban Development Data

20. Bay Area counties’ average home value decrease was -28% • Solano County had the largest decrease (-48%) in home value • Bay Area counties’ average unemployment rate was 10% • Alameda and Solano Counties had the highest unemployment rate (12%) • Source: June 2009-2010 U.S. Dept. of Housing and Urban Development Data

23. Index of Need • High number of foreclosures • Estimated number of completed foreclosures from June 2009-June 2010 from RealtyTrac Count based on estimated share of delinquent borrowers • Weight: 40% • High number of delinquent mortgages • Estimated rate of mortgages that are seriously delinquent (90 or more days) by county in June 2010 from McDash Analytics’ predictive model • Weight 30% • High number of house price decrease • Metropolitan area’s decrease in home value since peak value as of June 2010 from Federal Housing Finance Agency Home Price Index • Weight 20% • High number of unemployment • County unemployment rate as of June 2010 from Bureau of Labor Statistics Local Area Unemployment Statistics • Weight 10% Source: June 2009-2010 U.S. Dept. of Housing and Urban Development Data

25. Take Aways • NSP funded Bay Area counties with high foreclosure rates • Other variables are indicators of foreclosure assistance need • Solano, Contra Costa, and Alameda counties have the highest need for assistance • NSP funded Santa Clara County with the most funding • Policy impact: foreclosure prevention assistance is needed

26. Summary of GIS Skills • Inset Map • Point Graduated Symbol • Aggregating Attribute Data • Attribute Sub-sets Selections • Boundary Sub-sets Selections • Geoprocessing layers • Modeling • Metadata • Measurement/Analysis • Original Data • Charts and Images • Hotspot Analysis

27. GIS Modeling

28. Data Sources • 2000 U.S. Census and 2005-2009 American Communities Survey • Original data sources: • HUD data reflecting housing market conditions between June 2009-2010 includes RealtyTrac data on foreclosures; concatenated state, county, and census tract codes for geocoding • HUD data as of January 2011 regarding NSP funding for states, counties, cities and nonprofits; aggregated by county (refer to metadata screen shot)

29. Metadata

30. Photo Credits • Slide #1 – The Los Angeles Times, December 18, 2007, Location: Palmdale, CA • Slide #1 - David Butow, The Los Angeles Times, January 6, 2011, Location: Stockton, CA • Slide #3 – Jonathan Alcorn, The Los Angeles Times, March 10, 2011 Location: Los Angeles, CA • Slide #30 - The Los Angeles Times, March 10, 2007, Location: unknown Presentation by: Karna Wong UCLA March 2011 GIS 206A Professor Kawano