Declining foreclosure neighborhood effects over time
AbstractAccording to previous studies, residential foreclosures reduce the value of neighboring residential units and the initial negative effects decay over time and space. This study attempts to investigate the temporal path of the initial effects by following cohorts of single-family housing distressed sales (foreclosures and real estate owned sales) over time. A hedonic model estimation of single-family housing sales in Saint Louis County, Missouri, produced larger marginal impacts for new distressed sales in the year 2000 compared with the marginal impact of new distressed sales in 2007, that is, the marginal impact of new distressed sales is declining in at least one housing market. This result holds true for the distressed sale neighborhood impact, the effect of distress on the same unit's future sales price, and the discount on a distressed unit's current “liquidation sale” price.
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Bibliographic InfoArticle provided by Taylor & Francis Journals in its journal Housing Policy Debate.
Volume (Year): 20 (2010)
Issue (Month): 4 (September)
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Web page: http://www.tandfonline.com/RHPD20
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- Kashian, Russell & Carroll, Joseph D., Jr., 2011. "The Effect of Sheriffâ€™s Sales on Condominium Sub-Market Property Values," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 41(1).
- Whitaker, Stephan & Fitzpatrick IV, Thomas J., 2013. "Deconstructing distressed-property spillovers: The effects of vacant, tax-delinquent, and foreclosed properties in housing submarkets," Journal of Housing Economics, Elsevier, vol. 22(2), pages 79-91.
- Stephan Whitaker & Thomas J. Fitzpatrick IV, 2012. "Land Bank 2.0: an empirical evaluation," Working Paper 1230, Federal Reserve Bank of Cleveland.
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