CST: 26/06/2016 06:39:55   

Home Values Lower in Zips With a Higher Density of Registered Criminal Offenders According to New RealtyTrac Index

101 Days ago

First-Ever Registered Criminal Offender Risk Index Covers 10,000 U.S. Zip Codes; Average Home Equity, 10-Year Appreciation Higher in Zips With Very Low Offender Index

IRVINE, CA --(Marketwired - March 17, 2016) -  RealtyTrac® (www.realtytrac.com), the nation's leading source for comprehensive housing data, today released its first-ever Registered Criminal Offender Risk Index, which shows that average home values and home equity were lower -- while average foreclosure rates were higher -- in zip codes with a higher offender index than in zip codes with a lower offender index.

The report also shows that average home price appreciation has been slightly stronger over the past year and five years in zip codes with a higher offender index than in zip codes with a lower offender index, but only zip codes with an offender index in the bottom 20th percentile have seen home prices rebound above levels from 10 years ago.

"This new index provides concrete evidence that registered criminal offenders pose not only a potential safety risk for homeowners and their families, but also a potential financial risk for what is likely a homeowner's biggest asset," said Daren Blomquist, senior vice president at RealtyTrac. "This is clearly evident in the significantly lower home values and significantly higher foreclosure rates in zip codes with a higher offender index, but it may not be as evident in the home price appreciation numbers, which are actually slightly stronger over the past year and five years in zip codes with a higher offender index. However, the 10-year appreciation numbers demonstrate home values in the lowest-risk zip codes for offenders were not hit as hard during the housing downturn and have rebounded more quickly back to their previous highs -- even exceeding those previous highs."

         
    Registered Criminal Offender Risk Index Category    
Real Estate Metric   Very Low   Low   Medium   High   Very High   All Categories
Number of Zip Codes   2,072   2,071   2,072   2,071   2,072   10,358
Number of Single Family Homes & Condos   12,828,121   15,651,196   14,348,072   13,407,731   11,416,748   67,651,868
Average Estimated Home Value   $512,841   $359,780   $264,448   $208,278   $157,844   $300,641
Average Combined Loan to Value (CLTV)   71   76   80   84   90   80
Average of 2015 Median price   $450,925   $308,483   $226,291   $173,494   $126,205   $257,082
Average 1-Year Home Price Appreciation   5%   6%   7%   7%   7%   6%
5-Year HPA   20%   22%   23%   24%   24%   22%
10-Year HPA   7%   0%   -2%   0%   0%   2%
Average of 2015 Median Price per Square Foot   $243   $180   $138   $110   $81   $150
Average of 2015 Foreclosure Rate (Pct of Homes)   1.01%   1.19%   1.40%   1.52%   1.63%   1.35%
Average of 1-Year Foreclosure Activity Pct Change   18%   12%   13%   22%   31%   19%
Average of 5-Year Foreclosure Activity Pct Change   -24%   -37%   -37%   -32%   -29%   -32%
                         

The index is based on the number of registered criminal offenders (including sex offenders, child predators, kidnappers and violent offenders) as a percentage of total population in 10,358 U.S. zip codes. The offender data is collected from each state's criminal offender registry online and is available on RealtyTrac subsidiary www.homedisclosure.com, where offenders living within a half-mile radius of a home can be identified.

The index ranges from 0 to 100, with a higher index indicating a higher percentage of offenders. Zip codes were placed in one of five risk categories -- each representing 20 percent of all zip codes: Very High, High, Medium, Low and Very Low. Publicly recorded real estate data collected by RealtyTrac was also included for each zip code to analyze information about home values, homeowner equity, home price appreciation and foreclosure rates in each zip code (see full methodology below).

Markets with highest percentage of homes in zip codes with Very High offender index
Markets with the highest percentage of homes in zip codes with a Very High offender index were Greenville, South Carolina (73 percent); Columbia, South Carolina (66 percent); Boise, Idaho (66 percent); Pensacola, Florida (60 percent); and Flint, Michigan (57 percent).

Major markets where more than one-fourth of all homes were in zip codes with a Very High offender index included Detroit (39 percent), Nashville (32 percent), San Antonio (31 percent), St. Louis (31 percent), and Tampa (26 percent).

Markets with highest percentage of homes in zip codes with Very Low offender index
Markets with the highest percentage of homes in zip codes with a Very Low offender index were Minneapolis-St. Paul (90 percent); Portland, Oregon (88 percent); Trenton, New Jersey (62 percent); New York (61 percent); and Boston (52 percent).

Other major markets where more than one-fourth of all homes were in zip codes with a Very Low offender index included Phoenix (47 percent), San Francisco (38 percent), Seattle (36 percent), San Diego (35 percent), Miami (29 percent), Los Angeles (29 percent), and Chicago (29 percent).

The higher the offender index, the lower the home value and home equity
Average home values as of the first quarter of 2016 in zip codes with a Very Low offender index ($512,841) were more than three times higher than home values in zip codes with a Very High offender index ($157,844).

Furthermore, the average 2015 median sales price for homes in zip codes with a Very Low offender index ($450,925) was more than three times higher than the average 2015 median sales price in zip codes with a Very High offender index ($126,205). The median price per square foot on average for homes in zip codes with a Very Low offender index was $243, three times higher than in zip codes with a Very High offender index ($81).

Homeowners living in zip codes with a Very Low offender index on average had 29 percent equity (71 Combined Loan-to-Value) as of the first quarter of 2016, nearly three times the average 10 percent equity (90 CLTV) for homeowners living in zip codes with a Very High offender index.

The higher the offender index, the higher the foreclosure rate
The average 2015 foreclosure rate (percent of all single family homes and condos with a foreclosure filing) in zip codes with a Very High offender index was 1.63 percent, 61 percent higher than the average 2015 foreclosure rate of 1.01 percent in zip codes with a Very Low offender index.

Foreclosure activity in 2015 increased 31 percent from 2014 in zip codes with a Very High offender index while foreclosure activity in 2015 increased 18 percent in zip codes with a Very Low offender index. However, the lowest annual percentage increase in foreclosure activity in 2015 was in zip codes with a Low offender index (12 percent), followed by zip codes with a Medium offender index (13 percent). Foreclosure activity in 2015 increased 22 percent from 2014 in zip codes with a High offender index.

Home prices rebound above 10-year-ago levels only in zips with Very Low offender index
Among homes that sold in 2015, the average one-year home price appreciation in zip codes with a Very High offender index (up 7 percent) was slightly higher than the average one-year HPA in zip codes with a Very Low offender index (up 5 percent).

Home prices also rose slightly faster over the past five years in zip codes with a Very High offender index (up 24 percent on average) than in zip codes with a Very Low offender index (up 20 percent on average).

Median home sales prices in zip codes with a Very Low offender index in 2015 were 7 percent higher than median sales prices 10 years ago, in 2005, but home prices in all other offender index categories were flat or lower than 10 years ago.

Report methodology
The RealtyTrac Registered Criminal Offender Risk Index is based on the number of registered criminal offenders (including sex offenders, child predators, kidnappers and violent offenders) as a percentage of total population in 10,358 U.S. zip codes. Multiple methods were used to remove offenders living in correctional facilities from the index. The offender data is collected from each state's criminal offender registry online and is available at no cost on RealtyTrac subsidiary www.homedisclosure.com, where offenders living within a half-mile radius of a home can be identified.

The index ranges from 0 to 100, with a higher index indicating a higher percentage of offenders. Zip codes were placed in one of five risk categories -- each representing 20 percent of all zip codes: Very High (Index above 31.45); High (Index above 17.52 up to 31.45); Medium (Index above 9.55 up to 17.52); Low (Index above 4.09 up to 9.55); and Very Low (Index up to 4.09). Publicly recorded real estate data collected by RealtyTrac was also included for each zip code to analyze information about home values, homeowner equity, home price appreciation and foreclosure rates in each zip code.

About RealtyTrac
RealtyTrac is a leading provider of comprehensive U.S. housing and property data, including nationwide parcel-level records for more than 130 million U.S. properties. Detailed data attributes include property characteristics, tax assessor data, sales and mortgage deed records, distressed data, including default, foreclosure and auctions status, and Automated Valuation Models (AVMs). Sourced from RealtyTrac subsidiary Homefacts.com, the company's proprietary national neighborhood-level database includes more than 50 key local and neighborhood level dynamics for residential properties, providing unrivaled pre-diligence capabilities and a parcel risk database for portfolio analysis. RealtyTrac's data is widely viewed as the industry standard and, as such, is relied upon by real estate professionals and service providers, marketers and financial institutions, as well as the Federal Reserve, U.S. Treasury Department, HUD, state housing and banking departments, investment funds and tens of millions of consumers. 

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