View PDF

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

U.S Department of Housing and Urban Development
U.S. Department of the Treasury

Spotlight on the Housing Market

Spotlight on the Housing Market in Cleveland-Elyria-Mentor, Ohio

in Cleveland-Elyria-Mentor, Ohio

The Obama Administration's Efforts to Stabilize the Housing Market and Help American Homeowners
The	
  Cleveland-­‐Elyria-­‐Mentor,	
  Ohio	
  Metropolitan	
  StaAsAcal	
  Area	
  (Cleveland	
  MSA)	
  comprises	
  Cuyahoga,	
  Geauga,	
  Lake,	
  Lorain	
  and	
  Medina
industrial	
  Midwest,	
  the	
  foreclosure	
  crisis	
  in	
  Cleveland	
  developed	
  differently	
  and	
  earlier	
  than	
  in	
  other	
  areas	
  of	
  the	
  naAon.	
  	
  As	
  early	
  as	
  200
that	
  of	
  the	
  naAon	
  and	
  rising	
  -­‐-­‐	
  the	
  rapid	
  rise	
  of	
  distressed	
  mortgages	
  in	
  the	
  naAon	
  did	
  not	
  begin	
  unAl	
  2007.	
  	
  A	
  substanAal	
  share	
  of	
  mortg
or	
  subprime	
  loans	
  which	
  typically	
  defaulted	
  at	
  8	
  Ames	
  the	
  rate	
  of	
  other	
  mortgages.	
  	
  By	
  2007,	
  Cleveland	
  had	
  already	
  experienced	
  several	
  
populaAon	
  declines.	
  Cleveland	
  did	
  not	
  experience	
  the	
  rapid	
  appreciaAon	
  of	
  the	
  housing	
  bubble;	
  yet,	
  home	
  prices	
  have	
  fallen	
  on	
  a	
  percen
market	
  in	
  Cleveland	
  remains	
  fragile	
  –	
  with	
  low	
  property	
  values,	
  foreclosed	
  properAes	
  sold	
  at	
  deep	
  discounts	
  adversely	
  affecAng	
  neighbo
the	
  AdministraAon’s	
  broad	
  approach	
  to	
  stabilizing	
  the	
  housing	
  market	
  has	
  been	
  the	
  source	
  of	
  real	
  help	
  to	
  homeowners	
  in	
  Cleveland	
  and
AdministraAon’s	
  housing	
  scorecard	
  provides	
  a	
  summary	
  of	
  trends	
  and	
  condiAons	
  in	
  the	
  local	
  economy	
  and	
  the	
  impact	
  of	
  the	
  AdministraA
homeowners.	
  	
  
	
  
	
  	
  

Population Growth, Employment, and Housing Market:

U.S. Department of Housing and Urban 	
  Housing Market and PolicyAmerican Homeowners |
Office
Development and Research
The Obama Administration’s Efforts to Stabilize TheDevelopment as	
  |experienced	
  pof Helpecline	
  since	
  2000,	
  decreasing	
  at	
  an	
  annual	
  rate	
  of	
  0September Population	
  Has	
  Decline	
  
2011
The	
  Cleveland	
  MSA	
  h
opulaAon	
  d
.3	
  
percent	
  over	
  the	
  decade.	
  	
  The	
  most	
  recent	
  decennial	
  Census	
  count,	
  at	
  less	
  than	
  2.1	
  million	
  as	
  of	
  April	
  2010,	
  

represents	
  a	
  decline	
  of	
  70,900	
  persons	
  since	
  t Geauga, Lake, Lorain Ame,	
   Medina Counties in northeastern
The Cleveland-Elyria-Mentor, Ohio Metropolitan Statistical Area (Cleveland MSA) includes Cuyahoga,he	
  previous	
  Census.	
  	
  During	
  this	
  and net	
  out-­‐migraAon	
  
Date
Clevelan
averaged	
  11,500	
  
a	
  year,	
  m
Ohio. The foreclosure crisis in Cleveland and other parts of the industrial Midwestpeople	
  006	
  and	
  hostly	
  due	
  bty	
  mn	
  average	
  annual	
  loss	
  of	
  14,500	
  s	
  a	
  rtheut-­‐migraAon	
  As early as 2003,
developed as	
  fallen	
  earlier tthanalf	
  that	
  level	
  areas jof esult,	
  the	
  annual	
   eaked	
  
much o	
  a ore	
   han	
  h in other since.	
  	
  A obs.	
  	
  O nation. p
4/1/00
	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  
in	
  the	
  year	
  ending	
  July	
  2
4/1/10
	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  
the share of distressed mortgages in Cleveland was above the national average and has	
  slowed	
  considerably	
  distressed mortgage shares did not begin until 2007 in most
decline	
  in	
  populaAon	
   rising –the rise in since	
  2006.	
  
Source: Census Bureau
	
   of the housing bubble; yet, local home prices fell by nearly as great a percentage as those (2000 and 2010
other regions. The Cleveland MSA did not see the rapid appreciation
for the rest of the nation. By the start of the national mortgage crisis in 2007, Cleveland had already experienced several years of above average unemployment
and population declines, and high cost or subprime loans were defaultingmployment	
  ftimes	
  othe rate1ofyears	
  primarily	
  due	
  to	
  losses	
  in	
  the	
  mof these reasons,hich	
  accounted	
  for	
  more	
  than	
  40	
  percent	
  of
Area	
  e at eight ell	
  in	
  8 f	
  the	
  past	
   0	
   other mortgages. For all anufacturing	
  sector,	
  w the housing market
in Housing Market in – with low property values, deeply-discounted foreclosed s	
  of	
  July	
  2011	
   	
  up	
  by	
  0.7	
  p neighborhood values, and many 0.9	
  percent	
   ob	
  growth	
  rate	
  
light on theCleveland remains fragileCleveland-Elyria-Mentor, Ohio employed	
  in	
  the	
  MSA	
  aproperties–affectingercent	
  from	
  a	
  year	
  ago–	
  while	
  the	
  naAon	
  saw	
  a	
  severely junderwaterduring	
  the	
  same	
  pe
high	
   1,138,200	
  j
2000.	
  T
mortgages. However, the Administration’s broad approach to stabilizingof	
  a^ributed	
  tobs	
  nmarketin	
  May	
  been he	
  aof	
  13,090.	
  	
  Employment	
  gains	
  homeownersoinuly	
  nd	
  health	
  services	
  (6,800),	
  fprofessional	
  
the housing	
   recorded	
   has mployment	
  source nemployment	
  rate	
  was	
  7.9	
  percent	
  as	
   f	
  J Cleveland cand
a verage	
  u of real help to occurred	
  in	
  educaAon	
  a 2011,	
  down	
   onsiderably	
   rom	
  9.3	
  perc
mainly	
  
o	
  a et	
  increase	
  in	
  e
surrounding cities. This addendum to the Administration’s housing Homeowners - Septembera offset	
  by	
  a	
  d of trends and conditions in Even	
  the	
  manufacturing	
  s and the impact of
trade	
  sector	
  (3,500),	
  w 2011
The Obama Administration's Efforts to Stabilize the Housing Market and Help American scorecard provideshile	
  summaryecline	
  in	
  government	
  services	
  (3,500).	
  	
  the local economyector	
  showed	
  an	
  increase	
  of	
  1,700	
  jobs	
  in
nd-­‐Elyria-­‐Mentor,	
  Ohio	
  Metropolitan	
  StaAsAcal	
  Area	
  (Cleveland	
  MSA)	
  comprises	
  Cuyahoga,	
  Geauga,	
  Lake,	
  Lorain	
  aunemployment	
  rate	
  during	
  the	
  same	
  phio.	
  	
  Awwith	
  other	
  parts	
  of	
  the	
  
nd	
   edina	
  CounAes	
  in	
  
the Administration’s efforts to stabilize the housing market and help localMhomeowners.northeastern	
  O eriod	
   s	
   as	
  9.1	
  percent,	
  down	
  from	
  9.5	
  percent	
  a	
  year	
  ago.	
  	
  	
  	
  

dwest,	
  the	
  foreclosure	
  crisis	
  in	
  Cleveland	
  developed	
  differently	
  and	
  earlier	
  than	
  in	
  other	
  areas	
  of	
  the	
  naAon.	
  	
  As	
  e	
  arly	
  as	
  2003,	
  the	
  share	
  of	
  distressed	
  mortgages	
  in	
  Cleveland	
  was	
  above	
  
aAon	
  and	
  rising	
  -­‐-­‐	
  the	
  rapid	
  rise	
  of	
  distressed	
  mortgages	
  in	
  the	
  naAon	
  did	
  not	
  begin	
  unAl	
  2007.	
  	
  A	
  substanAal	
  share	
  of	
  mortgage	
  loans	
  in	
  the	
  Cleveland	
  area	
  prior	
  to	
  2007	
  were	
  high	
  cost	
  
	
  loans	
  which	
  typically	
  defaulted	
  at	
  8	
  Ames	
  the	
  rate	
  of	
  other	
  mortgages.	
  	
  By	
  2007,	
  Cleveland	
  had	
  already	
  experienced	
  several	
  years	
  of	
  unemployment	
  above	
  the	
  naAonal	
  average	
  and	
  
declines.	
  Cleveland	
  did	
  not	
  experience	
  the	
  rapid	
  appreciaAon	
  of	
  the	
  housing	
  bubble;	
  yet,	
  home	
  prices	
  have	
  fallen	
  on	
  a	
  percentage	
  basis	
  nearly	
  as	
  far	
  as	
  those	
  for	
  the	
  naAon.	
  	
  The	
  housing	
  
eveland	
  remains	
  fragile	
  –	
  with	
  low	
  property	
  values,	
  foreclosed	
  properAes	
  sold	
  at	
  deep	
  discounts	
  adversely	
  affecAng	
  neighborhoods,	
  and	
  many	
  severely	
  underwater	
  mortgages.	
  	
  However,	
  
Job Market Conditions are Stabilizing
traAon’s	
  broad	
  approach	
  to	
  stabilizing	
  the	
  housing	
  market	
  has	
  been	
  the	
  source	
  of	
  real	
  help	
  to	
  homeowners	
  in	
  Cleveland	
  and	
  surrounding	
  ciAes.	
  	
  This	
  bimonthly	
  addendum	
  to	
  the	
  
Quarterly	
   honfarm	
  
on’s	
  housing	
  scorecard	
  provides	
  a	
  summary	
  of	
  trends	
  and	
  condiAons	
  in	
  the	
  local	
  economy	
  and	
  the	
  impact	
  of	
  the	
  AdministraAon’s	
  efforts	
  to	
  stabilize	
  the	
  housing	
  market	
  and	
  Nelp	
  local	
  Employment	
  
s.	
  	
  

Population Growth, Employment,
and Housing Market:

The population of the Cleveland MSA has fallen at an annual
rate of 0.3 percent since 2000. The most recent decennial
1,150	
  
Census count, at less
th, Employment, and Housing Market: than 2.1 million as of April 2010,
represents a decline of 70,900 persons since the previous
1,100	
  
Population	
  Has	
  Decline	
  in	
  Cleveland	
  Over	
  the	
  Past	
  Decade
has	
  experienced	
  populaAon	
  decline	
  since	
  2000,	
  decreasing	
  at	
  an	
  annual	
  rate	
  of	
  0.3	
  
cade.	
  	
  The	
  most	
  Census. During this time, an averageas	
  of	
  11,500 people
recent	
  decennial	
  Census	
  count,	
  at	
  less	
  than	
  2.1	
  million	
   of April	
  2010,	
  
Annual	
  Growth	
  Rate	
  From	
  
	
  of	
  70,900	
  persons	
  since	
  the	
  previous	
  Census.	
  	
  During	
  this	
  Ame,	
  net	
  out-­‐migraAon	
   driven by an
moved out of the area each year, which was
Date
Cleveland	
  MSA	
  Population
Prior	
  Date
1,050	
  
ople	
  a	
  year,	
  mostly	
  due	
  to	
  an	
  average	
  annual	
  loss	
  of	
  14,500	
  jobs.	
  	
  Out-­‐migraAon	
  peaked	
  
average loss of 14,500 jobs each year. Population loss 4/1/00
-­‐
	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  2,148,143
uly	
  2006	
  and	
  has	
  fallen	
  by	
  more	
  than	
  half	
  that	
  level	
  since.	
  	
  As	
  a	
  result,	
  the	
  annual	
  
4/1/10
	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  2,077,240
-­‐0.3%
n	
  has	
  slowed	
  considerably	
  since	
  2006.	
  
peaked in the year ending July 2006 but has slowed by more
1,000	
  
Source: Census Bureau (2000 and 2010 Decennial)
than half that level since.

12	
  
145	
  

135	
  

2,077,240

-0.3%

NaAon	
  (right	
  	
  axis)	
  

Source: Census Bureau (2000 and 2010 Decennial)

Millions	
  

Unemployment Rate Remains High,
But Shows Improvement
Monthly	
  Unemployment	
  Rate	
  (Percent)	
  

	
  

10	
  
8	
  
6	
  
4	
  
2	
  
0	
  

	
  

Seasonally	
  Adjusted	
  Data	
  
Source:	
  Bureau	
  of	
  Labor	
  StaAsAcs	
  

4	
  
2	
  

120	
  

12	
  

Cleveland	
  MSA	
  

Spotlight on Cleveland MSA | Page 1

6	
  

125	
  

	
  

Area employment fell in 8 ofStabilizing years primarily due to
Job Market Conditions are the past 10
Quarterly	
   manufacturing sector, which accounted for more
job losses in the Nonfarm	
  Employment	
  
than 40 percent of all job losses. Slightly more than one150	
  
million
people were employed in the MSA as of July 2011 – up by 0.7
145	
  
percent from a year ago – while the nation saw a 0.9 percent
job growth rate during the same period. Local payrolls remain
140	
  
137,600 jobs below the record high of 1,138,200 jobs recorded
in May 2000. The average unemployment rate was 7.9135	
  
percent
as of July 2011, down considerably from 9.3 percent a year
130	
  
earlier. The decline in the unemployment rate is mainly attributed
to a net increase in employment of 13,090. Employment gains
125	
  
occurred in education and health services (6,800), professional
120	
  
and business services (3,900), and the wholesale and retail trade
sector (3,500), while offset by a decline in government services
(3,500). Even the Quarter	
  
Year	
  and	
   manufacturing sector showed an increase of
1,700 SA	
  
Cleveland	
  	
  Mjobs in the year ending July 2011. The national average
NaAon	
  (right	
  	
  axis)	
  
usted	
  Data	
  	
  
unemployment rate during the same period was 9.1 percent,
u	
  of	
  Labor	
  	
  StaAsAcs	
  
down from 9.5 percent in July 2010.

8	
  

130	
  

ll	
  in	
  8	
  of	
  the	
  past	
  10	
  years	
  primarily	
  due	
  to	
  losses	
  in	
  the	
  manufacturing	
  sector,	
  which	
  accounted	
  for	
  more	
  than	
  40	
  percent	
  of	
  all	
  job	
  losses.	
  	
  Slightly	
  more	
  than	
  one	
  million	
  people	
  were	
  
Cleveland MSA
Annual Growth Rate
A	
  as	
  of	
  July	
  2011	
  –	
  up	
  by	
  0.7	
  percent	
  from	
  a	
  year	
  ago–	
  while	
  the	
  naAon	
  saw	
  a	
  0.9	
  percent	
  job	
  growth	
  rate	
  during	
  the	
  same	
  period.	
  	
  Local	
  payrolls	
  remain	
  137,600	
  jobs	
  below	
  the	
  record	
  
bs	
  recorded	
  in	
  May	
  2000.	
  The	
  average	
  unemployment	
  rate	
  was	
  7.9	
  percent	
  as	
  From Prior down	
  considerably	
  from	
  9.3	
  percent	
  a	
  year	
  earlier.	
  	
  The	
  decline	
  in	
  the	
  unemployment	
  rate	
  is	
  
of	
  July	
  2011,	
   Date
Date
Population
Year	
  and	
  Quarter	
  
a	
  net	
  increase	
  in	
  employment	
  of	
  13,090.	
  	
  Employment	
  gains	
  occurred	
  in	
  educaAon	
  and	
  health	
  services	
  (6,800),	
  professional	
  and	
  business	
  services	
  (3,900),	
  and	
  the	
  wholesale	
  and	
  retail	
  
Cleveland	
   MSA	
  
4/1/2000
2,148,143 anufacturing	
  sector	
  showed	
  an	
  increase	
  of	
  1,700	
  jobs	
  in	
  the	
  yAdjusted	
  Data	
  	
   2011.	
  The	
  n	
  aAonal	
  average	
  
	
  while	
  offset	
  by	
  a	
  decline	
  in	
  government	
  services	
  (3,500).	
  	
  Even	
  the	
  m
Seasonally	
   ear	
  ending	
  July	
  
during	
  the	
  same	
  period	
  was	
  9.1	
  percent,	
  down	
  from	
  9.5	
  percent	
  a	
  year	
  ago.	
  	
  	
  	
  
Source:	
  Bureau	
  of	
  Labor	
  	
  StaAsAcs	
  

4/1/2010

10	
  

Millions	
  

Thousands	
  

140	
  

950	
  

Population Has Declined in Cleveland Over the Past Decade

150	
  

NaAon	
  

0	
  

	
  

Sea
Sou

The	
  home	
  sales	
  market	
  remains	
  soP	
  in	
  the	
  Cleveland	
  MSA.	
  ExisSng	
  home	
  sales	
  have	
  declined	
  steadily	
  since	
  
2005,	
  while	
  new	
  home	
  sales	
  showed	
  a	
  slight	
  increase	
  between	
  2009	
  and	
  2010	
  aPer	
  declining	
  since	
  2004.	
  	
  	
  
During	
  the	
  first	
  six	
  months	
  of	
  2011,	
  exisSng	
  home	
  sales	
  declined	
  by	
  20	
  percent	
  compared	
  with	
  the	
  first	
  six	
  
months	
  of	
  2010,	
  while	
  new	
  home	
  sales	
  declined	
  42	
  percent,	
  according	
  to	
  CoreLogic.	
  Sales	
  of	
  distressed	
  homes	
  –	
  
foreclosures	
  and	
  short	
  sales	
  –	
  currently	
  represent	
  27	
  percent	
  of	
  all	
  exisSng	
  home	
  sales	
  in	
  the	
  MSA,	
  the	
  same	
  as	
  
the	
  naSonal	
  rate.	
  The	
  high	
  proporSon	
  of	
  distressed	
  sales	
  (many	
  of	
  which	
  have	
  been	
  sold	
  at	
  deep	
  discounts	
  
according	
  to	
  researchers	
  at	
  Case	
  Western	
  Reserve	
  University)	
  has	
  kept	
  Cleveland	
  home	
  prices	
  depressed.	
  The	
  
CoreLogic	
  repeat-­‐sales	
  house	
  price	
  index	
  shows	
  that	
  home	
  prices	
  in	
  Cleveland	
  rose	
  at	
  one-­‐fiPh	
  the	
  pace	
  of	
  the	
  
rest	
  of	
  the	
  naSon	
  between	
  2000	
  and	
  2005.	
  Although	
  home	
  prices	
  in	
  Cleveland	
  never	
  experienced	
  the	
  bubble	
  
that	
  the	
  rest	
  of	
  the	
  naSon	
  did,	
  prices	
  nonetheless	
  declined	
  28	
  percent	
  from	
  their	
  peak	
  in	
  October	
  2005	
  to	
  their	
  
low	
  in	
  February	
  2009	
  -­‐-­‐	
  similar	
  to	
  the	
  naSonal	
  average	
  peak-­‐to-­‐low	
  decline	
  of	
  29	
  percent.	
  	
  While	
  the	
  overall	
  
market	
  remains	
  fragile,	
  local	
  home	
  prices	
  have	
  shown	
  signs	
  of	
  stabilizing	
  since	
  February	
  2009	
  and	
  are	
  currently	
  
higher	
  than	
  their	
  2009	
   Office of Policy Development and Research
Development |lows.	
  The	
  local	
  rental	
  market	
  is	
  improving	
  with	
  an	
  average	
  apartment	
  vacancy	
  rate	
  of	
  5.1	
  
percent	
  in	
  the	
  second	
  quarter	
  of	
  2011,	
  down	
  from	
  6.7	
  percent	
  a	
  year	
  earlier	
  and	
  below	
  the	
  naSonal	
  average	
  of	
  
5.9	
  percent	
  according	
  to	
  Reis,	
  Inc.	
  	
  The	
  average	
  rent	
  for	
  an	
  apartment,	
  at	
  $739,	
  is	
  just	
  1	
  percent	
  higher	
  than	
  a	
  
year	
  ago.	
  The	
  average	
  rent	
  naSonwide	
  increased	
  by	
  2	
  percent	
  to	
  $1,053	
  during	
  the	
  same	
  period.	
  	
  	
  	
  
	
  

U.S Department of Housing and Urban Development
U.S. Department of the Treasury

U.S. Department of Housing and Urban
The Obama Administration’s Efforts to Stabilize The Housing Market and Help American Homeowners | September 2011

Home sales remain soft in the Cleveland MSA. Existing home
New and Existing Home Sales:
sales have declined steadily since 2005 and new home sales
Cleveland Compared to the Nation
have been declining since 2004, although the market saw a
Annual	
  Home	
  Sales	
  (thousands)	
  	
  
slight increase between 2009 and 2010. During the first six
45	
  
8,000	
  
months of 2011, existing home sales declined by 20 percent
40	
  
7,000	
  
compared with the first six months of 2010, while new home
35	
  
sales declined 42 percent, according to CoreLogic. Sales of
6,000	
  
distressed homes – foreclosures and short sales – currently
30	
  
5,000	
  
represent 27 percent of all existing home sales in the Cleveland
25	
  
4,000	
  
market, on par with the national rate. The high proportion of
20	
  
distressed sales – which were sold at deep discounts according
3,000	
  
15	
  
to Case Western University researchers – has weakened
2,000	
  
10	
  
Cleveland home prices overall. The CoreLogic repeat-sales
1,000	
  
5	
  
house price index shows that home prices in Cleveland rose at
one-fifth the national pace between 2000 and 2005. Although
0	
  
0	
  
2003	
  
2004	
  
2005	
  
2006	
  
2007	
  
2008	
  
2009	
  
2010	
  
home prices in Cleveland never experienced the bubble that
NaSon:	
  ExisSng	
  Sales	
  (right	
  axis)	
  
NaSon:	
  New	
  Sales	
  (right	
  axis)	
  
was seen in the rest of the nation, prices nonetheless declined 28
Cleveland	
  MSA:	
  ExisSng	
  	
  Sales	
  
Cleveland	
  MSA:	
  New	
  	
  Sales	
  
percent from their peak in October 2005 to their low in February
Sources:	
  CoreLogic,	
  HUD/Census	
  	
  Bureau,	
  and	
  NaSonal	
  AssociaSon	
  of	
  Realtors	
  
2009 – similar to the national average peak-to-low decline of
Spotlight on the Housing MarketCleveland market remains fragile, local
29 percent. While the in Cleveland-Elyria-Mentor, Ohio
Spotlight on the Housing Market in Cleveland-Elyria-Mentor, in Mortgage Delinquencies and Foreclosures:	
  	
  	
  
Trends Ohio
home prices have shown signs of stabilizing since February
g	
  home	
  sales	
  have	
  declined	
  steadily	
  since	
  
Homeowners	
  in	
  Cleveland	
  have	
  struggled	
  with	
  high	
  levels	
  of	
  mortgage	
  delinquency	
  and	
  foreclosure.	
  	
  As	
  of	
  July	
  
2009 and are currently above the lows seen in 2009. The local
09	
  emains	
  soP	
  in	
  the	
  Cleveland	
  M2004.	
  	
  	
  
2011,	
  the	
  Cleveland	
  MSA	
  ranked	
  42nd	
  in	
  the	
  naSon	
  for	
  the	
  highest	
  percentage	
  of	
  mortgages	
  that	
  were	
  90	
  or	
  more	
  
t	
  r and	
  2010	
  aPer	
  declining	
  since	
   SA.	
  ExisSng	
  home	
  sales	
  have	
  declined	
  steadily	
  since	
  
y	
  20	
  percent	
  compared	
  with	
  the	
  first	
  six	
   2009	
  and	
  2010	
  aPer	
  declining	
  since	
  2004.	
  	
  	
   with an
days	
  delinquent	
  or	
  in	
  the	
  process	
  of	
  foreclosure,	
  according	
  to	
  LPS	
  Applied	
  Declined,hrough	
  the	
  efforts	
  of	
  
Cleveland House Prices AnalyScs.	
  	
  T
	
  sales	
  showed	
  arentalncrease	
  between	
   showing signs of improvement
	
  slight	
  i market is also
ding	
  oo	
  2011,	
  exisSng	
  home	
  istressed	
  homes	
  –20	
  percent	
  compared	
  with	
  the	
  first	
  six	
  
t f	
   CoreLogic.	
  Sales	
  of	
  dsales	
  declined	
  by	
   	
  
numerous	
  state	
  and	
  local	
  enSSes	
  iAlthough Never Experienced Housingumber	
  of	
  mortgages	
  at	
  risk	
  of	
  
n	
  partnership	
  with	
  the	
  federal	
  government,	
  the	
  n Bubble,
nths	
  
average apartment vacancy rate of 5.1 percent in the second
Cleveland House Prices Declined,
	
  new	
  home	
  sales	
  declined	
  4Mpercent,	
  ame	
  as	
   to	
  CoreLogic.	
  Sales	
  of	
  distressed	
  homes	
  –	
  
exisSng	
  home	
  sales	
  in	
  the	
   2	
  SA,	
  the	
  s according	
  
foreclosure	
  (90	
  or	
  more	
  days	
  delinquent	
  or	
  in	
  the	
  process	
  of	
  foreclosure)	
  in	
  the	
  Cleveland	
  area	
  declined	
  
	
  
Market Remains Fragile July	
  2011,	
   Never Experienced Housing Bubble,
quarter eep	
  
2011, down from 6.7 percent a year earlier
from19,471	
  (9.6	
  percent	
  of	
  all	
  mortgages)	
  in	
  July	
  2010	
  to	
  18,975	
  (8.7	
  percent)	
  iAlthough compared	
  with	
  a	
  
n	
  
	
  which	
  have	
  been	
  sold	
  at	
  dof7	
  discounts	
  f	
  all	
  exisSng	
  home	
  sales	
  in	
  the	
  MSA,	
  the	
  same	
  as	
   and
	
  sales	
  –	
  currently	
  represent	
  2 percent	
  o
Repeat-­‐Sales	
  House	
  Price	
  Index	
  	
  share	
   000	
  =	
  100)	
   Market (90	
  or	
  
naSonal	
  of	
  decline	
  from	
  7.5	
  to	
  6.8	
  percent.	
  CoreLogic	
  data	
  show	
  that	
  the	
  (Jan	
  2of	
  distressed	
  mortgages	
  Remains Fragile
kept	
  Cleveland	
  home	
  prices	
  dsnational of	
  
below the ales	
  (many	
   average of 5.9 percent according to Reis Inc.
high	
  proporSon	
  of	
  distressed	
  epressed.	
  The	
   which	
  have	
  been	
  sold	
  at	
  deep	
  discounts	
  
n	
  Cleveland	
  rose	
  at	
  one-­‐fiPh	
  the	
  pace	
  of	
  the	
  
more	
  days	
  delinquent)	
  has	
  been	
  high	
  in	
  Cleveland	
  for	
  a	
  considerable	
  length	
  of	
  Sme.	
  Since	
  peaking	
  in	
  	
  February	
   ndex	
  	
  (Jan	
  2000	
  =	
  100)	
  
Repeat-­‐Sales	
  House	
  Price	
  I
rs	
  at	
  Case	
  Western	
  Reserve	
  University)	
  has	
  kan Cleveland	
  home	
  at $739, is only 1 percent
ept	
   apartment, prices	
  depressed.	
  The	
  
220	
  
The average rent for
n	
  Cleveland	
  never	
  experienced	
  the	
  bubble	
  
2010	
  at	
  8.7	
  percent,	
  90-­‐plus-­‐day	
  delinquency	
  rates	
  have	
  fallen	
  to	
  7.8	
  percent.	
  This	
  compares	
  with	
  a	
  	
  naSonal	
  
	
  house	
  price	
  index	
  shows	
  that	
  home	
  prices	
  in	
  Cleveland	
  rose	
  at	
  one-­‐fiPh	
  the	
  pace	
  of	
  the	
  
220	
  
ent	
  from	
  their	
  peak	
  in	
  October	
  2005	
  to	
  their	
  
decline	
  from	
  8.5	
  percent	
  to	
  7.2	
  percent	
  over	
  the	
  same	
  period.	
  Realty	
  Trac	
  data	
  show	
  that	
  completed	
  foreclosures	
  
higher thanhome	
  prices	
  in	
  Cleveland	
  never	
  experienced	
  the	
  bubble	
   increased
a year ago. The average rent nationwide
200	
  
ween	
  2000	
  and	
  2005.	
  Although	
  
w	
  decline	
  of	
  29	
  percent.	
  	
  While	
  the	
  overall	
  
have	
  also	
  declined	
  in	
  Cleveland	
  over	
  the	
  past	
  year,	
  dropping	
  from	
  1,840	
  in	
  the	
  second	
  quarter	
  of	
  2010	
  to	
  690	
  in	
  the	
  
Son	
  did,	
  prices	
  nonetheless	
  declined	
  2$1,053 rom	
  their	
  peak	
  isame period. their	
  
by 2 percent to 8	
  percent	
  f during the n	
  October	
  2005	
  to	
  
200	
  
second	
  quarter	
  of	
  2011,	
  although	
  lender	
  process	
  reviews	
  conSnue	
  to	
  affect	
  foreclosure	
  compleSons	
  locally	
  and	
  
180	
  
bilizing	
  since	
  February	
  2009	
  and	
  are	
  currently	
  

-­‐	
  similar	
  to	
  the	
  naSonal	
  average	
  peak-­‐to-­‐low	
  decline	
  of	
  29	
  percent.	
  	
  While	
  the	
  overall	
  
with	
  an	
  average	
  apartment	
  vacancy	
  rate	
  of	
  5.1	
  
,	
  local	
  home	
  prices	
  have	
  shown	
  signs	
  of	
  stabilizing	
  since	
  February	
  2009	
  and	
  are	
  currently	
  
ear	
  earlier	
  and	
  below	
  the	
  naSonal	
  average	
  of	
  
	
  lows.	
  The	
  local	
  rental	
  market	
  is	
  improving	
  with	
  an	
  average	
  apartment	
  vacancy	
  rate	
  of	
  5.1	
  
ent,	
  at	
  $739,	
  is	
  just	
  1	
  percent	
  higher	
  than	
  a	
  
quarter	
  of	
  2011,	
  down	
  from	
  6.7	
  percent	
  a	
  year	
  earlier	
  and	
  below	
  the	
  naSonal	
  average	
  of	
  
1,053	
  during	
  the	
  same	
  period.	
  	
  	
  	
  
to	
  Reis,	
  Inc.	
  	
  The	
  average	
  rent	
  for	
  an	
  apartment,	
  at	
  $739,	
  is	
  just	
  1	
  percent	
  higher	
  than	
  a	
  
rent	
  naSonwide	
  increased	
  by	
  2	
  percent	
  to	
  $1,053	
  during	
  the	
  same	
  period.	
  	
  	
  	
  

Trends in Mortgage
Delinquencies and Foreclosures:
Home Sales:

d to the Nation New and Existing Home Sales:
	
  (thousands)	
  	
   Homeowners in Cleveland are still struggling with high levels
Cleveland Compared to the Nation

8.5	
  

8.0	
  

7.5	
  

7.0	
  

6.5	
  

6.0	
  

5.5	
  

5.0	
  

Sou

naSonally.	
  	
  Currently,	
  27	
  percent	
  of	
  mortgages	
  in	
  180	
   Cleveland	
  MSA	
  have	
  negaSve	
  equity	
  compared	
  with	
  23	
  
the	
  
160	
  
percent	
  naSonally	
  according	
  to	
  CoreLogic	
  -­‐-­‐	
  represenSng	
  more	
  homeowners	
  and	
  loans	
  potenSally	
  at	
  risk.	
  	
  
	
  
160	
  
140	
  
120	
  

140	
  

100	
  

120	
  

100	
  
Foreclosure	
  Completion	
  Rates	
  in	
  the	
  Cleveland	
  MSA
80	
  
Second	
  Quarter	
  2011
Since	
  April	
  1,	
  2009
Area
Foreclosure	
  
Foreclosure	
  
Foreclosure	
  Rate
Foreclosure	
  Rate
Completions
Completions
Cleveland	
  MSA	
  
NaSon	
  
Cleveland	
  MSA	
  
	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  690	
  
0.1%
	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  16,200	
  
1.7%
Cleveland	
  MSA	
  
Source:	
  
Nation	
   CoreLogic	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  203,876	
  
	
  	
  	
  	
  	
  	
  	
  
0.2%
	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  2,203,386	
  
1.7%
Note:	
  	
  Foreclosure	
  Rates	
  as	
  Percent	
  of	
  All	
  Housing	
  Units; Source:	
  CoreLogic	
  
	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  Data	
  through	
  July	
  2011	
  for	
  Foreclosures	
  since	
  2009
Source:	
  Realty	
  Trac	
  and	
  Census	
  Bureau

10	
  

80	
  

Annual	
  H delinquency and
of mortgageome	
  Sales	
  (thousands)	
  	
   foreclosure. As of July 2011,
8,000	
  
LPS Applied Analytics ranked the Cleveland MSA 42nd out
8,000	
  
7,000	
  
of 367 metropolitan areas for the percentage of mortgages
7,000	
  
6,000	
  
that were 90 or more days delinquent or in the process
5,000	
  
of foreclosure. Through the efforts of numerous state 6,000	
  
and
5,000	
  
local entities in partnership with the federal government,
4,000	
  
the number of mortgages at risk of foreclosure (90 or4,000	
  
more
3,000	
  
days delinquent or in the process of foreclosure) in theRental Vacancy Rates Consistently Lower Than Nation
3,000	
   Quarterly	
  Apartment	
  Rental	
  Vacancy	
  Rates	
  (Percent)	
  Rates Consistently Lower Than Nation
Rental Vacancy
2,000	
  
Cleveland area declined from 19,471 (9.6 percent of all
Quarterly	
  Apartment	
  Rental	
  Vacancy	
  Rates	
  (Percent)	
  
8.5	
  
2,000	
  
mortgages) in July 2010 to 18,975 (8.7 percent) in July
1,000	
  
8.5	
  
2011, compared with a national decline from 7.5 to1,000	
  
6.8
8.0	
  
0	
  
percent. CoreLogic data since 2000 show that the share
2007	
  
2008	
  
2009	
  
2010	
  
8.0	
  
0	
  
of distressed mortgages (902008	
   more2009	
  7.5	
   delinquent) has
or
days 2010	
  
2004	
  
2005	
  
2006	
  
NaSon:	
  New	
  Sales	
  (right	
  axis)	
   2007	
  
7.5	
  
been consistently
7.0	
  
Cleveland	
  MSA:	
  
Son:	
  ExisSng	
  Sales	
  (right	
  axis)	
   New	
  	
  Sales	
   higher in ClevelandSales	
  (right	
  axis)	
   nation.
NaSon:	
  New	
   than in the
Since peaking in February 2010 at MSA:	
  New	
  	
  Sales	
   90-plus-day
7.0	
  
veland	
  MSA:	
  ExisSng	
  	
  Sales	
  
Cleveland	
   8.7 percent,
of	
  Realtors	
  
6.5	
  
delinquency rates have fallen to 7.8 percent. This compares
	
  HUD/Census	
  	
  Bureau,	
  and	
  NaSonal	
  AssociaSon	
  of	
  Realtors	
  
6.5	
  
6.0	
  
with a national decline from 8.5 percent to 7.2 percent
res:	
  	
  	
  
6.0	
  
overforeclosure.	
  	
  As	
  period. 	
  Realty Trac data 5.5	
  
the same of	
  July	
   	
  
show that completed
age	
  
age delinquency	
  and	
   and Foreclosures:	
  
Delinquencies
	
  percentage	
  of	
  mortgages	
  that	
  were	
  90	
  ortgage	
   declined in Cleveland over
foreclosures have more	
  
and	
  have	
  struggled	
  with	
  high	
  levels	
  of	
  mor	
  alsodelinquency	
  and	
  foreclosure.	
  	
  As	
  of	
  July	
   the past
5.5	
  
Applied	
  AnalyScs.	
  	
  Through	
  the	
  efforts	
  of	
  
5.0	
  
SA	
  ranked	
  42nd	
  year, aSon	
  for	
  the	
  highest	
  percentage	
  oin ortgages	
  that	
  were	
  90	
  or	
  more	
   2010
in	
  the	
  n
f	
  m the second quarter of
overnment,	
  the	
  number	
  dropping afrom f	
  
of	
  mortgages	
   t	
  risk	
  o 1,840
he	
  process	
  of	
  foreclosure,	
  according	
  to	
  LPS	
  Applied	
  AnalyScs.	
  	
  Through	
  the	
  efforts	
  of	
  
5.0	
  
osure)	
  in	
  the	
  Cleveland	
  area	
  declined	
  
to 690 in the	
   second quarter number	
  of	
  m although lender
cal	
  enSSes	
  in	
  partnership	
  with	
  thefederal	
  government,	
  the	
  of 2011,ortgages	
  at	
  risk	
  of	
  
.7	
  percent)	
  in	
  July	
  2011,	
  compared	
  with	
  a	
  
e	
  days	
  delinquent	
  or	
  in	
  the	
  process	
  of	
  foreclosure)	
  in	
  tto Cleveland	
  area	
  declined	
   completions
he	
   affect foreclosure
process ortgages	
  (90	
  or	
  
Year	
  and	
  Quarter	
  
at	
  the	
  share	
  of	
  distressed	
  mreviews continue
nt	
  of	
  all	
  mortgages)	
  in	
  July	
  2010	
  to	
  18,975	
  (8.7	
  percent)	
  in	
  July	
  2011,	
  compared	
  with	
  a	
  
locally and nationally. CoreLogic reports that or	
  
le	
  length	
  of	
  percent.	
  CoreLogic	
  data	
  ebruary	
   the	
  share	
  of	
  distressed	
  mortgages	
  (90	
  27 percent of
Sme.	
  Since	
  peaking	
  in	
  	
  F show	
  that	
  
Year	
  and	
  Quarter	
  
m	
  7.5	
  to	
  6.8	
  
Cleveland	
  MSA	
  
NaSon	
  
Source:	
  Reis,	
  Inc.	
  
.8	
  percent.	
  This	
  compares	
  with	
  a	
  	
  naSonal	
  
mortgages 	
  considerable	
  length	
  of	
  S MSA are currently in
has	
  been	
  high	
  in	
  Cleveland	
  for	
  ain the Cleveland me.	
  Since	
  peaking	
  in	
  	
  February	
   negative
ty	
  Trac	
  data	
  show	
  that	
  completed	
  foreclosures	
  
Cleveland	
  MSA	
  
NaSon	
  
Source:	
  Reis,	
  Inc.	
  
-­‐plus-­‐day	
  delinquency	
  rates	
  have	
  fallen	
  to	
  7.8	
  percent.	
  This	
  compares	
  with	
  a	
  	
  naSonal	
  
equity compared with
1,840	
  in	
  the	
  second	
  quarter	
  of	
  2010	
  to	
  690	
  in	
  the	
  23 percent nationally– representing
nt	
  to	
  7.2	
  percent	
  over	
  the	
  same	
  period.	
  Realty	
  Trac	
  data	
  show	
  that	
  completed	
  foreclosures	
  
to	
  affect	
  foreclosure	
  compleSons	
  locally	
  and	
  
even ymore homeowners the	
  second	
  quarter	
  of	
  2010	
  to	
  690	
  in	
  the	
  
and loans potentially at risk.
eveland	
  over	
  the	
  past	
   ear,	
  dropping	
  from	
  1,840	
  in	
  

SA	
   lthough	
  lender	
   quity	
  compared	
  conSnue	
  
1,	
  ahave	
  negaSve	
  eprocess	
  reviews	
  with	
  23	
   to	
  affect	
  foreclosure	
  compleSons	
  locally	
  and	
  
meowners	
  and	
  loans	
  potenSally	
  at	
  risk.	
  	
  
27	
  percent	
  of	
  mortgages	
  in	
  the	
  Cleveland	
  MSA	
  have	
  negaSve	
  equity	
  compared	
  with	
  23	
  
rding	
  to	
  CoreLogic	
  -­‐-­‐	
  represenSng	
  more	
  homeowners	
  and	
  loans	
  potenSally	
  at	
  risk.	
  Share of Distressed Mortgages Rose Earlier Than in the Nation
	
  

and Now Declining Distressed Mortgages Rose Earlier Than in the Nation
Share of

Mortgages	
  90+	
  Days	
  Delinquent	
  (Percent	
  MSA | Page 2 Now Declining
Spotlight on Cleveland of	
  all	
  Mortgages)	
  
and

9	
  
8	
  
7	
  
6	
  

NaSon	
  

5	
  
4	
  
3	
  
2	
  
1	
  
0	
  

Source:	
  CoreL

s:	
  CoreLogic,	
  HUD/Census	
  	
  Bureau,	
  and	
  NaSonal	
  AssociaSon	
  of	
  Realtors	
  

6.5	
  
6.0	
  

n MortgageDepartment of Housing and Urban Development
U.S Delinquencies and Foreclosures:	
  	
  	
  

rs	
  in	
  Cleveland	
  hDepartment of the Treasury delinquency	
  and	
  foreclosure.	
  	
  As	
  of	
  July	
  
U.S. ave	
  struggled	
  with	
  high	
  levels	
  of	
  mortgage	
  
eveland	
  MSA	
  ranked	
  42nd	
  in	
  the	
  naSon	
  for	
  the	
  highest	
  percentage	
  of	
  mortgages	
  that	
  were	
  90	
  or	
  more	
  
uent	
  or	
  in	
  the	
  process	
  of	
  foreclosure,	
  according	
  to	
  LPS	
  Applied	
  AnalyScs.	
  	
  Through	
  the	
  efforts	
  of	
  
tate	
  and	
  local	
  enSSes	
  in	
  partnership	
  with	
  the	
  federal	
  government,	
  the	
  number	
  of	
  mortgages	
  at	
  risk	
  of	
  
(90	
  or	
  more	
  days	
  delinquent	
  or	
  in	
  the	
  process	
  of	
  foreclosure)	
  in	
  the	
  Cleveland	
  area	
  declined	
  
	
  (9.6	
  percent	
  of	
  all	
  mortgages)	
  in	
  July	
  2010	
  to	
  18,975	
  (8.7	
  percent)	
  in	
  July	
  2011,	
  compared	
  with	
  a	
  
decline	
  from	
  7.5	
  to	
  6.8	
  percent.	
  CoreLogic	
  data	
  show	
  that	
  the	
  share	
  of	
  distressed	
  mortgages	
  (90	
  or	
  
delinquent)	
  has	
  been	
  high	
  in	
  Cleveland	
  for	
  a	
  considerable	
  length	
  of	
  Sme.	
  Since	
  peaking	
  in	
  	
  February	
  
percent,	
  90-­‐plus-­‐day	
  delinquency	
  rates	
  have	
  fallen	
  to	
  7.8	
  percent.	
  This	
  compares	
  with	
  a	
  	
  naSonal	
  
U.S. Department of ompleted	
  foreclosures	
  
m	
  8.5	
  percent	
  to	
  7.2	
  percent	
  over	
  the	
  same	
  period.	
  Realty	
  Trac	
  data	
  show	
  that	
  cHousing and Urban
eclined	
  in	
  Cleveland	
  over	
  the	
  past	
  year,	
  dropping	
  from	
  1,840	
  in	
  the	
  second	
  quarter	
  of	
  2010	
  to	
  690	
  in	
  the	
  
rter	
  of	
  2011,	
  although	
  lender	
  process	
  reviews	
  conSnue	
  to	
  affect	
  foreclosure	
  compleSons	
  locally	
  and	
  
Currently,	
  27	
  percent	
  of	
  mortgages	
  in	
  the	
  Cleveland	
  MSA	
  have	
  negaSve	
  equity	
  compared	
  with	
  23	
  
onally	
  according	
  to	
  CoreLogic	
  -­‐-­‐	
  represenSng	
  more	
  homeowners	
  and	
  loans	
  potenSally	
  at	
  risk.	
  	
  

5.5	
  
5.0	
  

Year	
  and	
  Quarter	
  
Cleveland	
  MSA	
  

Source:	
  Reis,	
  Inc.	
  

NaSon	
  

The Obama Administration’s Efforts to Stabilize TheDevelopment | Office of Help American Homeowners | September 2011
Housing Market and Policy Development and Research
Foreclosure Completion Rates in the Cleveland MSA
Second Quarter 2011
Area
Cleveland

Foreclosure
Completions

690

Foreclosure
Rate

Share of Distressed Mortgages Rose Earlier Than in the Nation
and Now Declining

Since April 1, 2009
Foreclosure
Completions

0.1%

16,200

Foreclosure
Rate

Mortgages	
  90+	
  Days	
  Delinquent	
  (Percent	
  of	
  all	
  Mortgages)	
  

10	
  

1.7%

MSA
Foreclosure	
  Completion	
  Rates	
  in	
  the	
  Cleveland	
  MSA
Second	
  Quarter	
  2011
Since	
  April	
  1,	
  2009
Foreclosure	
   on
Nati Foreclosure	
  Rate
203,876 Foreclosure	
   Foreclosure	
  Rate
0.2%
2,203,386
1.7%
Completions
Completions
SA	
   	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  690	
  
0.1%
	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  16,200	
  
1.7%
	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  2Note: Foreclosure Rates	
  	
  as	
  	
  Percent of All Housing Units; Data through July
03,876	
  
0.2%
	
  	
  	
  	
   	
  	
  	
  	
  	
  	
  	
  2,203,386	
  
1.7%
ure	
  Rates	
  as	
  Percent	
  of	
  All	
  for Foreclosures since 2009
Housing	
  Units;
2011
rough	
  July	
  2011	
  for	
  Foreclosures	
  since	
  2009and Census Bureau
Source: Realty Trac
Trac	
  and	
  Census	
  Bureau

9	
  
8	
  
7	
  
6	
  
5	
  
4	
  
3	
  
2	
  
1	
  

The Administration’s Efforts
to Stabilize the Cleveland
Housing Market:
The Administration’s Efforts to Stabilize the Cleveland Housing Market:

0	
  

Spotlight on the Housing Market in Cleveland-Elyria-Mentor, Ohio

	
  
From the launch of the Administration’s assistance
From	
  the	
  launch	
  of	
  the	
  AdministraDon’s	
  assistance	
  programs	
  through	
  the	
  end	
  of	
  July	
  2011,	
  
approximately	
  32,300	
  mortgage	
  assistance	
  intervenDons	
  have	
  been	
  offered	
  to	
  homeowners	
  in	
  the	
  
programs in April 2009 through the end of July 2011,
Cleveland	
  metropolitan	
  area.	
  	
  Nearly	
  17,700	
  intervenDons	
  were	
  offered	
  through	
  the	
  Home	
  Affordable	
  
approximately the	
  Federal	
   ousing	
  AdministraDon	
  (FHA)	
  loss	
  miDgaDon	
  and	
  early	
  
ModificaDon	
  Program	
  (HAMP)	
  and	
  32,300Hmortgage assistance interventions
delinquency	
  intervenDon	
  programs.	
  	
  An	
  eto homeowners in proprietary	
  modificaDons	
  have	
  
have been offered sDmated	
  addiDonal	
  14,600	
   the Cleveland
been	
  offered	
  through	
  Hope	
  Now	
  Alliance	
  servicers.	
  While	
  some	
  homeowners	
  may	
  have	
  received	
  help	
  
metropolitan area. Nearly 17,700 interventions were
from	
  more	
  than	
  one	
  program,	
  the	
  number	
  of	
  Dmes	
  assistance	
  has	
  been	
  offered	
  is	
  nearly	
  double	
  the	
  
offered completed	
   the Home Affordable leveland	
  MSA.	
  	
  	
  	
  
number	
  of	
  foreclosures	
  throughduring	
  this	
  period	
  (16,200)	
  in	
  the	
  CModification
	
  
Program (HAMP) and the Federal Housing Administration
In	
  addiDon	
  to	
  offers	
  of	
  mortgage	
  aid	
  to	
  homeowners,	
  the	
  AdministraDon’s	
  Neighborhood	
  StabilizaDon	
  
(FHA) loss mitigation and early delinquency intervention
Program	
  (NSP)	
  and	
  Hardest	
  Hit	
  Fund	
  (HHF)	
  have	
  been	
  helping	
  to	
  stabilize	
  the	
  Cleveland	
  housing	
  market.	
  	
  
	
  
programs. An estimated additional 14,600 proprietary
Eight	
  jurisdicDons	
  in	
  the	
  Cleveland	
  MSA	
  have	
  received	
  NSP	
  grants:	
  the	
  ciDes	
  of	
  Cleveland,	
  East	
  
Cleveland,	
  Emodifications have he	
  counDes	
  of	
  Cuyahoga,	
  Lake,	
  and	
  Lorain.	
  	
  The	
  Cuyahoga	
  
lyria,	
  Euclid,	
  and	
  Lorain	
  and	
  t been offered through Hope Now
County	
  Land	
  ReuDlizaDon	
  servicers. 	
  While some homeowners may Cuyahoga	
  
Alliance CorporaDon,	
  a consorDum	
  between	
  the	
  City	
  of	
  Cleveland	
  and	
   have
County,	
  has	
  also	
  received	
  an	
  NSP	
  grant.	
  
received help from more than one program, the number
	
  
of times assistance has been offered is nearly double
	
  
	
  	
  
the number of foreclosures completed during this period
	
  
(16,200) in the Cleveland MSA.
	
  
	
  
	
  
In addition to offers of mortgage aid to homeowners, the
	
  

Administration’s Neighborhood Stabilization Program
(NSP) and Hardest Hit Fund have been helping to
stabilize the nits)
Cleveland	
  MSA	
  NSP	
  Activity	
  (Housing	
  UCleveland housing market.
Projected
Completed
NSP1	
  Total
	
  	
  	
  Clearance	
  and	
  demolition
	
  	
  	
  Homeownership	
  assistance	
  to	
  low-­‐	
  and	
  moderate-­‐income
	
  	
  	
  Rehabilitation/reconstruction	
  of	
  residential	
  structures
Cleveland MSA NSP Activity (Housing Units)
NSP2	
  Total
	
  	
  	
  Clearance	
  and	
  demolition
NSP1 Total
	
  	
  	
  Rehabilitation/reconstruction	
  of	
  residential	
  structures
NSP3	
  Total
Clearance and demolition
	
  	
  	
  Clearance	
  and	
  demolition
	
  	
  	
  Homeownership	
  assistance	
  to	
  low-­‐	
  and	
  moderate-­‐income to low- and
Homeownership assistance
	
  	
  	
  Rehabilitation/reconstruction	
  of	
  residential	
  structures

moderate-income

Rehabilitation/reconstruction of
residential structures

4012
1682
1457
1122
32
14
2523
546
Projected2225Completed
4
605
0
4012
1407
1620
4
900
0
1457505
847
0
56
32339
14
0

2523

546

Overall,	
  $38.8	
  million	
  in	
  NSP1,	
  $40.8	
  million	
  in	
  NSP2,	
  and	
  $13.1	
  million	
  in	
  NSP3	
  funds	
  have	
  been	
  awarded	
  
NSP2 Total
2225
4
to	
  these	
  nine	
  grantees	
  in	
  the	
  Cleveland	
  MSA.	
  	
  Local	
  authoriDes	
  in	
  Cleveland	
  devised	
  a	
  sophisDcated	
  
mapping	
  system	
  of	
  foreclosures	
  won/reconstruction of Reserve	
  University,	
  which	
  provides	
  crucial	
  
Rehabilitati ith	
  the	
  aid	
  of	
  Case	
  Western	
  
605
detail	
  about	
  every	
  property	
  in	
  fal structures enables	
  the	
  jurisdicDons	
  in	
  the	
  MSA	
  to	
  act	
  strategically	
  0
in	
  
residenti ocus	
  areas	
  and	
  
their	
  efforts	
  to	
  revitalize	
  neighborhoods.	
  Approximately	
  1,686	
  households	
  have	
  already	
  benefited	
  from	
  
NSP3 Total
1620
NSP,	
  and	
  acDviDes	
  funded	
  by	
  the	
  program	
  are	
  expected	
  to	
  provide	
  assistance	
  to	
  an	
  addiDonal	
  5,451	
   4
owner	
  and	
  renter	
  households.	
  Here	
  are	
  some	
  examples	
  of	
  how	
  these	
  funds	
  have	
  been	
  put	
  to	
  use:	
  	
  
Clearance and demolition
875
0
	
  	
  
•	
  The	
  City	
  of	
  Cleveland,	
  in	
  partnership	
  with	
  ChousingCounty,	
  developed	
  an	
  innovaDve	
  NSP1	
  program	
  to	
  
Construction of new uyahoga	
  
432
0
improve	
  neighborhoods	
  by	
  removing	
  or	
  rehabilitaDng	
  foreclosed	
  properDes	
  in	
  communiDes	
  through	
  
Homeownership assistance toflow- and program	
  was	
  implemented	
  through	
  
concentrated	
  investments	
  and	
  the	
  leveraging	
  of	
  private	
   unds.	
  	
  The	
  
56
moderate-income
nonprofit	
  partnerships	
  with	
  proven	
  performance	
  records	
  and	
  builds	
  on	
  exisDng	
  neighborhood	
  plans.	
  	
  The	
  
City	
  of	
  Cleveland	
  had	
  roughly	
  18,000	
  vacant	
  lots,	
  about	
  5,000	
  of	
  which	
  were	
  land	
  banked.	
  The	
  vacant	
  lots	
  
Rehabilitation/reconstruction of
387
had	
  the	
  effect	
  of	
  decreasing	
  property	
  values	
  and	
  the	
  quality	
  of	
  neighborhoods	
  for	
  residents.	
  	
  	
  One	
  of	
  t0
he	
  
residential structures
city’s	
  NSP1	
  programs	
  supports	
  a	
  pilot	
  land	
  reuse	
  iniDaDve.	
  Once	
  vacant	
  properDes	
  were	
  acquired,	
  the	
  
program	
  provided	
  grants	
  to	
  grassroots	
  neighborhood	
  groups,	
  churches,	
  schools	
  and	
  individuals	
  to	
  carry	
  
out	
  reclamaDon	
  projects.	
  	
  The	
  projects	
  will	
  be	
  maintained	
  by	
  the	
  community	
  groups	
  once	
  completed.	
  The	
  
city	
  selected	
  47	
  environmentally	
  sustainable	
  land	
  reuse	
  projects	
  that	
  are	
  being	
  conducted	
  on	
  125	
  vacant	
  
parcels	
  of	
  land	
  held	
  by	
  Cleveland’s	
  Land	
  ReuDlizaDon	
  Program.	
  Twenty-­‐five	
  projects	
  focus	
  on	
  urban	
  
agriculture	
  and	
  are	
  coordinated	
  by	
  The	
  Ohio	
  State	
  University	
  Extension.	
  	
  ParkWorks	
  Inc.	
  coordinates	
  
twenty-­‐two	
  groups	
  that	
  focus	
  on	
  urban	
  greening.	
  	
  AddiDonal	
  funding	
  for	
  this	
  pilot	
  program	
  was	
  received	
  
from	
  the	
  Surdna	
  FoundaDon	
  and	
  in-­‐kind	
  services	
  were	
  received	
  from	
  the	
  USEPA	
  Brownfield	
  Program,	
  
among	
  others.	
  
	
  

Cleveland	
  MSA	
  

NaSon	
  

Source:	
  CoreLogic	
  

Mortgage Aid Extended More Than 32,000 Times
to Mitigate Rising Foreclosures
Cleveland	
  MSA:	
  CumulaDve	
  Offers	
  of	
  Aid	
  by	
  Source	
  Compared	
  	
  
with	
  Foreclosures	
  Since	
  April	
  1,	
  2009	
  	
  (Thousands)	
  

35	
  

Mortgage	
  Aid	
  Offers	
  in	
  Cleveland	
  MSA	
  from	
  	
  April	
  2009	
  through	
  July	
  2011:	
  32,300	
  
Foreclosure	
  CompleDons	
  Over	
  Same	
  Period:	
  	
  16,200	
  

30	
  
25	
  
20	
  
15	
  
10	
  
5	
  
0	
  

FHA	
  Loss	
  MiDgaDon	
  

Hamp	
  ModificaDons	
  

EsDmated	
  Hope	
  Now	
  ModificaDons	
  

Foreclosure	
  CompleDons	
  

Note:	
  	
  Data	
  on	
  Hope	
  Now	
  proprietary	
  mortgage	
  modificaDons	
  not	
  available	
  at	
  metropolitan	
  area	
  level.	
  However,	
  Hope	
  Now	
  Alliance	
  
reports	
  66,600	
  non-­‐HAMP	
  modificaDons	
  since	
  April	
  1,	
  2009	
  in	
  the	
  state	
  of	
  OH	
  of	
  which	
  	
  22	
  	
  percent	
  are	
  esDmated	
  by	
  HUD	
  to	
  have	
  
occurred	
  in	
  the	
  Cleveland	
  MSA.	
  
	
  

Sources:	
  	
  Departments	
  of	
  HUD	
  and	
  Treasury,	
  Hope	
  Now	
  Alliance,	
  and	
  Realty	
  Trac.	
  

	
  

Given over three rounds, the Neighborhood Stabilization Program has
invested $7 billion nationwide to help localities work with non-profits and community
development corporations to turn tens of thousands of abandoned and foreclosed
homes that drag down property values into homeownership opportunities and the
	
  
affordable rental housing communities need.
This	
  approach	
  has	
  yielded	
  significant	
  results.	
  	
  For	
  example,	
  in	
  one	
  Cleveland	
  Census	
  block	
  group,	
  the	
  vacancy	
  rate	
  
dropped	
  by	
  nearly	
  40	
  percent	
  between	
  2008	
  and	
  2010.	
  So	
  far,	
  Cleveland	
  has	
  used	
  NSP1	
  funds	
  to	
  remove	
  the	
  
destabilizing	
  influence	
  of	
  86	
  properDes	
  and	
  to	
  rehabilitate	
  13	
  homes.	
  	
   received NSP grants: the cities of
Eight jurisdictions in the Cleveland MSA have
	
  
Cleveland, East Cleveland, Elyria, Euclid, and Lorain and the counties of Cuyahoga,
•	
  Building	
  on	
  the	
  success	
  of	
  their	
  partnership	
  using	
  NSP1	
  funds,	
  Cleveland	
  and	
  Cuyahoga	
  County	
  are	
  collaboraDng	
  on	
  
Lake, and Lorain. The Cuyahoga County Land Reutilization Corporation, a
an	
  NSP2	
  program.	
  The	
  Cuyahoga	
  County	
  Land	
  ReuKlizaKon	
  CorporaKon,	
  a	
  consorDum	
  between	
  the	
  two	
  
jurisdicDons,	
  is	
  using	
  more	
  than	
  $40	
  million	
  in	
  funds	
  to	
  implement	
  a	
  comprehensive	
  revitalizaDon	
  program	
  designed	
  
consortium between the City of Cleveland and Cuyahoga County, has also received
to	
  stabilize	
  20	
  target	
  areas	
  hit	
  by	
  the	
  foreclosure	
  crisis.	
  One	
  of	
  the	
  key	
  components	
  of	
  this	
  innovaDve	
  NSP2	
  program	
  
an eliminaDon	
  of	
  vacant	
  and	
  vandalized	
  properDes	
  in	
  an	
  environmentally	
  sustainable	
  manner.	
  With	
  funding	
  from	
  
is	
  the	
  NSP grant.
the	
  City	
  of	
  Cleveland,	
  the	
  program	
  includes	
  a	
  deconstrucDon	
  project	
  developed	
  by	
  Urban	
  Lumberjacks	
  of	
  Cleveland.	
  	
  
Blighted	
  homes	
  are	
  removed	
  in	
  an	
  environmentally	
  sustainable	
  manner	
  through	
  the	
  careful	
  disassembly	
  of	
  
Overall, $38.8 million in NSP1, $40.8 million in NSP2, and $13.1 million in NSP3
structures	
  so	
  that	
  parts	
  can	
  be	
  salvaged	
  and	
  reused.	
  	
  The	
  NSP	
  programs	
  are	
  also	
  providing	
  jobs	
  for	
  Cleveland	
  
funds have been awarded to these nine grantees in the Cleveland MSA. Local
residents.	
  
	
  	
  authorities in Cleveland devised a sophisticated mapping system of foreclosures
•	
  The	
  City	
  of	
  Lakewood	
  recently	
  received	
  $250,000	
  in	
  NSP3	
  funds	
  from	
  the	
  Cuyahoga	
  County	
  Department	
  of	
  
with the aid of Case Western lanning	
  and	
  Development	
  s which proposal	
  through	
  a	
  compeDDve	
  
Development.	
  The	
  Lakewood	
  Department	
  of	
  PReserve University,ubmiged	
  a	
  provides crucial detail
process	
  and	
  was	
  awarded	
  the	
  largest	
  focus mount	
  possible	
  in	
  this	
  round	
  of	
  jurisdictions money	
  along	
  with	
   to act
about every property in dollar	
  a areas and helps the funding.	
  The	
  NSP	
   in the MSA
other	
  investments	
  by	
  the	
  city	
  will	
  be	
  targeted	
  to	
  a	
  core	
  part	
  of	
  Lakewood.	
  The	
  area	
  bounded	
  by	
  Ridgewood	
  and	
  
strategically in adison,	
  has	
  been	
  hard	
  hit	
  in	
  the	
  housing	
  crisis	
  and	
  this	
  money	
  will	
  go	
  a	
  long	
  way	
  toward	
  
Clarence,	
  Detroit	
  and	
  Mtheir efforts to revitalize neighborhoods. Approximately 1,411
acquiring	
  homes	
  that	
  have	
  already benefited from NSP, and activities homes	
  for	
  rehabilitaDon	
  
households have been	
  abandoned	
  .	
  The	
  city’s	
  proposal	
  includes	
  obtaining	
  vacant	
   funded by the program
on	
  Clarence	
  Avenue	
  and	
  also	
  invesDng	
  in	
  properDes	
  on	
  Alameda	
  and	
  Lakewood	
  Avenues.	
  
are expected to provide assistance to an additional 5,701 owner and renter
	
  
	
   households. Here are some examples of how these funds have been put to use:
	
  
	
  
	
  
	
  
	
  
	
  

Spotlight on Cleveland MSA | Page 3

1.636935

U.S Department of Housing and Urban Development
U.S. Department of the Treasury

U.S. Department of Housing and Urban Housing Market and Policy Development and Research
The Obama Administration’s Efforts to Stabilize TheDevelopment | Office of Help American Homeowners | September 2011
The City of Cleveland, in partnership with Cuyahoga
County, developed an innovative NSP1 program to improve
neighborhoods by removing or rehabilitating foreclosed
properties in communities through concentrated investments and
the leveraging of private funds. The program was implemented
through nonprofit partnerships with proven performance records
and builds on existing neighborhood plans. The City of Cleveland
had roughly 18,000 vacant lots, about 5,000 of which were land
banked. The vacant lots had the effect of decreasing property
values and the quality of neighborhoods for residents. One of the
city’s NSP1 programs supports a pilot land reuse initiative. Once
vacant properties were acquired, the program provided grants to
grassroots neighborhood groups, churches, schools and individuals
to carry out reclamation projects. The projects will be maintained
by the community groups once completed. The city selected 47
environmentally sustainable land reuse projects that are being
conducted on 125 vacant parcels of land held by Cleveland’s
Land Reutilization Program. Twenty-five projects focus on urban
agriculture and are coordinated by The Ohio State University
Extension. ParkWorks Inc. coordinates twenty-two groups that
focus on urban greening. Additional funding for this pilot program
was received from the Surdna Foundation and in-kind services
were received from the USEPA Brownfield Program, among others.
This approach has yielded significant results. For example, in one
Cleveland Census block group, the vacancy rate dropped by nearly
40 percent between 2008 and 2010. So far, Cleveland has used
NSP1 funds to remove the destabilizing influence of 86 properties
and to rehabilitate 13 homes.

As part of the State of Ohio’s housing recovery efforts, the Restoring
Stability: A Save the Dream Ohio Initiative helps Ohio
homeowners struggling to make their monthly house payments or those
who have already fallen behind on their mortgage. Through the program,
the Ohio Housing Finance Agency (OHFA) is administering $570 million
from the Administration’s Hardest Hit Fund to help families avoid
foreclosure.

•

Building on the success of their partnership using NSP1 funds,
Cleveland and Cuyahoga County are collaborating on an NSP2
program. The Cuyahoga County Land Reutilization
Corporation is using more than $40 million in funds to implement
a comprehensive revitalization program designed to stabilize 20
target areas hit by the foreclosure crisis. One of the key components
of this innovative NSP2 program is the elimination of vacant and
vandalized properties in an environmentally sustainable manner.
With funding from the City of Cleveland, the program includes
a deconstruction project developed by Urban Lumberjacks of
Cleveland. Blighted homes are removed in an environmentally
sustainable manner through the careful disassembly of structures
so that parts can be salvaged and reused. The NSP programs are
also providing jobs for Cleveland residents.

Modification Assistance with Principal Reduction: The
program provides a payment incentive to mortgage servicers to reduce
a participating homeowner’s mortgage principal to the level necessary
to achieve a loan modification for an affordable monthly mortgage
payment -- ideally down to a 115% loan-to-value ratio or less. The
mortgage servicer will need to agree to provide principal forbearance
or forgiveness equal to or greater than the Restoring Stability payment.
As a result of this assistance, the homeowner should be able to qualify
for a loan modification through the Administration’s Home Affordable
Modification Program (HAMP) or other programs that can make the
monthly mortgage payment even more affordable. The principal
reduction provided by Restoring Stability is structured as a zero-interest,
deferred payment loan that is forgiven over five years, or repaid if the
home is sold or the loan is refinanced sooner.

•

The City of Lakewood recently received $250,000 in NSP3
funds from the Cuyahoga County Department of Development. The
Lakewood Department of Planning and Development submitted
a proposal through a competitive process and was awarded the
largest dollar amount possible in this round of funding. The NSP
money along with other investments by the city will be targeted to
a core part of Lakewood. The area bounded by Ridgewood and
Clarence, Detroit and Madison, has been hard hit in the housing
crisis and this money will go a long way toward acquiring homes
that have been abandoned. The city’s proposal includes obtaining
vacant homes for rehabilitation on Clarence Avenue and also
investing in properties on Alameda and Lakewood Avenues.

Transitional Assistance: The Transitional Assistance program
provides homeowners who cannot sustain homeownership with an
alternative to foreclosure by offering an incentive to mortgage servicers
to complete short sales or deed-in-lieu of foreclosure agreements.
Transitional Assistance allows homeowners to exit their homes if they
have exhausted all other options for maintaining homeownership or if
they need to relocate to gain meaningful employment. If necessary, the
plan may also make an incentive payment to a second lien holder to
release other liens on the property.

•

The Restoring Stability programs include:
Rescue Payment Assistance: The Rescue Payment Assistance
program provides payments to mortgage servicers to help delinquent
homeowners who can demonstrate a financial hardship become current
on their mortgages. The payments can cover principal, interest, fees,
delinquent taxes or escrow shortage and homeowners insurance.
Homeowners need to demonstrate the ability to make future mortgage
payments for at least six months. Rescue Payment Assistance is structured
as a zero-interest, deferred payment loan that is forgiven over five years,
or repaid from sales proceeds if the home is sold sooner.
Partial Mortgage Payment Assistance: This program provides
partial mortgage payments while unemployed homeowners search for
a job or participate in job training. Through the program, homeowners
are required to make affordable monthly payments of no less than 25%
of their current total monthly payment. Restoring Stability covers the
remainder of the payment. Partial Mortgage Payment Assistance is
structured as a zero-interest, deferred payment loan that is forgiven over
five years, or repaid if the home is sold or the loan is refinanced sooner.

To date, over 150 mortgage servicers have agreed to participate in
at least one of the Restoring Stability programs. The programs make
extensive use of local HUD-approved housing counseling agencies
to help homeowners access the program and apply for assistance.
Ohio homeowners who believe they may be eligible can visit www.
savethedream.ohio.gov. Ohio has these funds available until 2017 (or
until all funds are utilized to assist struggling homeowners) to prevent
avoidable foreclosures.

Spotlight on Cleveland MSA | Page 4


Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102