Publications

  • Do Foreclosures Cause Crime?

    Foreclosures affect not only individual homeowners, but also the crime levels of the surrounding neighborhood. This study found that neighborhoods with concentrated foreclosures see an uptick in crime for each foreclosure notice issued. These effects are pronounced in hardest hit neighborhoods; that is, those with concentrated foreclosures. The report suggests that policing and community stabilizing efforts should prioritize areas with concentrated foreclosures, especially those where crime rates are already moderate to high.

  • Housing and the Great Recession

    The story of the Great Recession cannot be told without addressing housing and, in particular, the dramatic decline in housing prices that began in late 2006. A distinctive feature of the Great Recession is its intimate connection to the housing sector; indeed many would argue that the Great Recession was triggered by the widespread failure of risky mortgage products. Whatever the sources of the Great Recession may have been, the housing sector is still deeply troubled and is a key contributor to our ongoing economic duress. This recession brief lays out the main features of the downturn in the housing sector. It was produced as part of a series on the economic and social fallout of the recession in conjunction with the Russell Sage Foundation and the Stanford Center on Poverty and Inequality.

  • Quarterly Housing Update 2012: 3rd Quarter

    In an analysis of third quarter housing indicators, the Furman Center finds that home sales volume remained relatively stagnant in the third quarter of 2012, with the number of transactions citywide down by 0.1 percent. Housing prices throughout the city are up 4.4 percent compared to the same quarter last year. The report also finds that the number of foreclosure notices issued in Q3 2012 has increased 14.5 percent citywide since the third quarter of 2011, with a 40.9 percent increase in Queens.

  • Do Foreclosures Cause Crime?

    The mortgage foreclosure crisis has generated increasing concerns about the effects of foreclosed properties on their surrounding neighborhoods, and on criminal activity in particular. Using a unique dataset of point-specific longitudinal crime and foreclosure data from New York City, this paper explores whether foreclosed properties affect criminal activity on the surrounding blockface – an individual street segment including properties on both sides of the street. The researchers report that foreclosures on a blockface lead to additional violent crimes and public order crimes, and these effects are largest when foreclosure activity is measured by the number of bank-owned properties on a blockface.

  • Essay: Sticky Seconds—The Problems Second Liens Pose to the Resolution of Distressed Mortgages

    To better understand whether and how second liens might prevent efficient resolutions of borrower distress and to assess how second lien holders could be encouraged to cooperate with efficient resolutions without undermining the financial interests of the banks, we reviewed existing data and research, as well as debates among both academics and industry experts about the role second liens might be playing in slowing the recovery of the housing market. This article reports the results of our research and the roundtable discussion. It first explores what we know about the prevalence and delinquency rates of different types of second liens, the extent to which banks are exposed to losses on the liens, and the extent to which the banks already have accounted for those expected losses. It then reviews the various reasons that second liens have interfered with the efficient resolution of distressed mortgages, and documents advances that recently have been made in addressing those problems. Finally, the article examines the most promising proposals for reducing the transaction costs and frictions that are behind many of the current problems second liens are posing, as well as proposals to prevent similar problems from arising in the future. We focus our analysis of solutions on programs to remove barriers to greater coordination between first and second lien holders, rather than on the incentive approaches that have already been attempted.

  • Quarterly Housing Update 2012: 1st Quarter

    In an analysis of first quarter housing indicators, the Furman Center finds that home sales volume rose in the first quarter of 2012, with the number of transactions citywide up almost five percent. Housing prices throughout the city are up 3.5 percent compared to the same quarter last year. The report also finds that the number of foreclosure notices issued in Q1 2012 has fallen citywide since its peak in the third quarter of 2009. However, foreclosure notices in Queens and Staten Island increased by more than 20 percent from the fourth quarter of 2011

  • Quarterly Housing Update 2012: 2nd Quarter

    In an analysis of second quarter housing indicators, the Furman Center finds that home sales volume increased in the third quarter of 2012, with the number of transactions citywide up by 16.4 percent. Housing prices throughout the city are up 2.7 percent compared to the same quarter last year. There were 243 new units authorized by building permits in the second quarter of 2012, 386 fewer than the previous quarter and 1,159 fewer than the same quarter of 2011. The report also finds that the number of foreclosure notices issued in Q2 2012 has increased 34.9 percent citywide since the first quarter of 2012, with the highest increase seen in Queens with 41 percent.

  • Pathways After Default: What Happens to Distressed Mortgage Borrowers and Their Homes?

    We use a detailed dataset of seriously delinquent mortgages to examine the dynamic process of mortgage default – from initial delinquency and default to final resolution of the loan and disposition of the property. We estimate a two-stage competing risk hazard model to assess the factors associated with whether a borrower behind on mortgage payments receives a legal notice of foreclosure, and with what ultimately happens to the borrower and property. In particular, we focus on a borrower’s ability to avoid a foreclosure auction by getting a modification, by refinancing the loan, or by selling the property. We find that the outcomes of the foreclosure process are significantly related to: the terms of the loan; the borrower’s credit history; current loan-to-value and the presence of a junior lien; the borrower’s post-default payment behavior; the borrower’s participation in foreclosure counseling; neighborhood characteristics such as foreclosure rates, recent house price depreciation and median income; and the borrower’s race and ethnicity.

  • Challenges Facing Housing Markets in the Next Decade: Developing a Policy-Relevant Research Agenda

    This paper proposes a research agenda that addresses the major challenges facing the U.S. housing market: the long-term effects of the housing market crisis on today’s households and on the next generation, increasing poverty coupled with persistently high income inequality and volatility, continued concentration of poor and minority households in low-quality housing and low-opportunity neighborhoods, and the growing need for sustainable and resilient buildings and communities. This analysis is a framing paper for the What Works Collaborative, a foundation-supported research partnership that conducts timely research and analysis to help inform the implementation of an evidence-based housing and urban policy agenda.

  • Quarterly Housing Update 2011: 4th Quarter

    In an analysis of fourth quarter housing indicators, the Furman Center finds that home sales volume continued to decline in the fourth quarter of 2011, with the number of transactions citywide down 15 percent from the previous quarter and 11 percent from the fourth quarter of 2010. Foreclosure starts were down in most of the city, with 33 percent fewer foreclosure notices issued in the fourth quarter of 2011 compared to the same quarter in 2010. Manhattan was the only borough where the number of foreclosure starts increased, although the number of notices issued in Manhattan still remained well below the numbers issued in any of the other boroughs.