Wednesday, July 27, 2011

Post Foreclosure Experience of US Households.

Thanks to an item in my fav BeSpacific, this New Federal Reserve study is HERE. From the study:
Although foreclosure considerably raises the probability of moving, the majority of post-foreclosure migrants do not end up in substantially less desirable neighborhoods or more crowded living conditions. These results suggest that, on average, foreclosure does not impose an economic burden large enough to severely reduce housing consumption....About 1/5 of post-foreclosure migrants move a long-enough distance to participate in a different labor market, a slightly smaller fraction than the comparison group....We find no evidence that post-foreclosure migrants are more likely to remain in the same school district or Census tract, so maintaining ties to a local school seems not to be important in the relocation individuals are more likely to move to denser areas with a lower homeownership rate. Their new neighborhoods also tend to have a higher fraction of female-headed households, smaller houses, a shorter average commute time, and lower income, although the magnitude of these differences is very small. By contrast, we find little difference between the post-foreclosure and comparison groups in other measures of neighborhood affluence including educational attainment, racial and ethnic composition, house value, or rent. Taken together, the evidence suggests that post-foreclosure individuals move to rental units in denser urban areas, but the new neighborhoods do not seem to be much less desirable.
Originally created and posted on the Oregon Housing Blog.

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