Affordability, lower wages, foreclosure rates cited
A real estate data company lists central and southern Delaware among the most vulnerable to changes in the housing market post-Covid.
The report from Attom listed Kent and Sussex counties, along with counties in New Jersey and Illinois, as having the highest concentration of vulnerable areas.
Markets were considered at risk based on the percentage of homes facing possible foreclosure, the portion with mortgage balances that exceeded estimated property values, and the percentage of average local wages required to pay for a residence.
Delaware had the fourth-highest home foreclosure rate as of August, according to online loan provider So-Fi. A high foreclosure rate is nothing new in a state that was slower than others to recover from the 2008-2009 financial crisis.
Affordable housing has long been a problem in Kent and Sussex. First responders, teachers, and others often stretch their finances to buy homes. Both counties also have fewer higher-paying jobs than New Castle County.
The housing market has also been affected by an influx of retirees, especially in Sussex, many of whom buy new homes but may also drive up prices when bidding for existing homes.
Delaware has reported among the highest growth figures in building permits in recent years. The figure is tied to housing.
About 10% of 500 counties around the nation in the report are in the vulnerable category, according to Attom.
”It’s important to stress that this doesn’t mean that any one area faces imminent danger, especially given how well the housing market has avoided major problems during the pandemic. Rather, some are more at risk than others. We will continue watching prices, affordability, distressed property counts, and other measures to gauge the risk, as long as the pandemic remains a big issue facing the country,” stated Todd Teta, chief product officer with Attom.
Click here for the full summary of the report.