“On October 5, 2012, the Federal Reserve Bank of New York and the Rockefeller Institute of Government co-hosted the conference Distressed Residential Real Estate: Dimensions, Impacts, and Remedies
. This post not only makes available a compendium
of the findings of the conference, but also updates and extends some of the analysis presented. In particular, we look across states to assess the differential impacts of judicial and non-judicial processes to resolve the foreclosure crisis. Controlling for the peak percentage of loans that were seriously delinquent, we find that non-judicial states are much further along in reducing the backlog of loans in foreclosure. In addition, controlling for the magnitude of the decline in home prices from peak to trough, we observe that home prices have recovered considerably more in the non-judicial states. As the title of the conference suggests, the conference was devoted to three main topics. First, presenters gave an assessment of the national, state, and local volumes of properties that remained in the foreclosure and “real estate owned” (REO
) pipeline. Second, experts presented research on the impacts of foreclosures and distressed sales on home prices, homeownership rates, communities and families, and state and local government finances. Third, a panel discussion explored policy initiatives intended to reduce the number of foreclosures and associated negative impacts.
National and state level data as of June 2012 were presented on the number of properties that were ninety-plus days delinquent, in foreclosure, and in REO. Also presented were alternative national and state level projections of future REO inventories under a range of alternative assumptions about the average numbers of days a loan stays in the ninety-plus-day delinquency status and the average number of days in foreclosure. These data were provided by CoreLogic under contract with the Federal Reserve Bank of New York and were made available on the Bank’s public website