The housing market in Ohio, Western Pennsylvania, Northern West Virginia, and Eastern Kentucky is turning around, as a recent report reveals declining REO numbers in the region for the second year in a row.
According to the Community Stabilization Index released Thursday by the Federal Reserve Bank of Cleveland, 2016 was the second consecutive year that bank-owned property numbers declined in the Fourth Federal Reserve District.
“The continuing decline in the stock of real estate owned, or REO properties indicates that housing markets are continuing to improve in the District,” said Brett Barkley, Senior Research Analyst with the Cleveland Fed.
According to the Fed’s release, the drop in REO properties is due, in large part, to the decline in mortgage delinquencies and foreclosures recently.
“The data suggest that banks have been more willing or more able to sell their properties of late,” Barkley said.
The index also revealed that the median value of originations and refinances are on the rise in all 15 metro areas it tracks. Additionally, originations activity overall is up across the district, except in the Lima, Ohio, area.
Though the upticks are a positive note for many of the district’s communities, in some areas—particularly those most affected by the housing crisis—it has not yet become a sustained upswing.
“We don’t see this same kind of functioning housing market coming back to the hardest hit zip codes,” Barkley said. “In some of the neighborhoods we profile in this update, we’ve seen the stock of REO properties come down, so that trend is good, but originations activity and the median value of those originations have not experienced a sustained positive trend.”
The CSI is released annually and is based on a number of housing and credit factors. It is designed to provide a relative measure of local housing market conditions and their recovery potential.