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Ellen Belcher is the Dayton Daily News opinion pages editor. She writes about state government, education, the environment, higher education and all things Dayton.
Martin Gottlieb is an editorial writer and columnist for the Dayton Daily News opinion pages. He focuses on the political process itself and does such national issues as war, the economy, taxes and Social Security, as well as a hodge-podge of local and state issues.Home > Blogs > A Matter of Opinion > Archives > 2009 > May > 03 > Entry
Editorial: Let up in foreclosures not here yet
In Ohio, Montgomery County’s foreclosure crisis is second only to the Cleveland area’s. So it seemed like good news last week when a California realty tracking company reported foreclosure filings in the Dayton area declined in March.
Not so fast, say local experts.
In fact, Montgomery County data show little reason to expect a foreclosure turnaround this year or even next.
While there has been a slight burst in houses being sold, that uptick won’t be enough to help the region’s housing market, if at the same time neighborhoods are threatened because homes continue to be abandoned or sold at depressed prices at sheriff’s sales.
RealtyTrac Inc., reported that foreclosure filings in the Dayton metropolitan area were down 14 percent for March when compared with last year. (The firm counts all foreclosure filings, which can include multiple filings in one foreclosure case, rather than just new filings.) Montgomery County’s numbers also were down.
Yet, Montgomery County Recorder Willis Blackshear, who methodically tracks foreclosures, says he sees no sign there will be a significant drop-off in 2009. Last March, his foreclosure prediction nearly matched exactly the final numbers for the year — 5,193 total new filings and 2,781 properties sold at auction.
For 2009, his latest projections are only slightly down — just over 5,000 new filings and 2,500 auction sales. His view fits with what other agencies that work with troubled homeowners are seeing. There’s been no lessening in demand for their services.
Mr. Blackshear said nothing so far has swayed him from his estimation that the crisis will not hit bottom until 2013. He’s not being inconsistent when he says that while the overall housing market may begin to recover over the next year or two, foreclosures could still remain high.
Consider, for instance, that buy-out payments to laid-off factory workers from General Motors and other companies could start running out this year and next for those who haven’t been able to find employment at comparable wages. Mr. Black-shear said he worries that many area homeowners could struggle to make mortgage payments that were based on their previously higher incomes.
In anticipation of this problem and the fact that the recession continues to strap a lot of families, Mr. Blackshear has tried to raise private contributions to hire two people to personally call on borrowers his office has identified through public records as having troubled or predatory loans. The hope would be to head off foreclosure before the process begins.
One person starts next month, but there isn’t money to hire a second individual.
Another frustration of Mr. Blackshear’s is that federal stimulus aid is going only to private groups trying to avert foreclosures; his outreach effort, unfortunately, can’t get a small slice of those funds. He thinks that it’s a mistake to assume that local government can’t, or shouldn’t, play a role in helping people stay in their homes.
“We’ve tried mailing letters, but the physical outreach is required,” he said. “It’s better than waiting until they come to you.”
Despite his gloomy forecast on foreclosures, Mr. Blackshear said he has seen a hint of good news in the housing market. While mortgage filings remain flat for 2009, his office, which records deeds and property transfers, has been seeing more activity from title companies lately.
That could mean home sales are in the pipeline, but that banks are backed up on processing loan requests or are being more careful about whom they’re loaning to. (With interest rates low and so many people refinancing, that also could be slowing down loan approvals that, in other times, would have more quickly shown up as sales.)
Realtors, too, have seen similar signs of hope, Dayton Area Board of Realtors President Harry Vearn said. March sales were the best year-over-year results for home sales since October, even though they fell slightly compared to last March. (It’s telling what passes for good news in this economy.)
That new interest presumably is driven, in part, by the federal stimulus that includes a big tax break for first-time home buyers — $8,000 or 10 percent of the home value, whichever is less. Mr. Vearn said that seems to have spurred young families who had previously held off on home shopping.
If a home sales bump materializes as a result of the stimulus, that is a good sign of smart federal spending to get the economy going. At the same time, local government programs like Mr. Blackshear’s also can attack a desperate housing problem in another important way.
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