Communities Count Data Updates for August Affordable Housing Living Wage Bankruptcies Home Foreclosures Unemployment Websites & Reports

Transcription

1 Communities Count 2008 Data Updates f August 2009 Affdable Housing Living Wage Bankruptcies Home Feclosures Unemployment Websites & Repts Page 1 of 10

2 Communities Count repts on a set of social and health indicats every three years. Communities Count 2008 is the fourth such rept. One strength of the rept is that it contains a stable set of indicats that can show trends over time. Generally, a three year cycle f updating the rept has been an efficient approach to making infmation available f planning, decision making and guiding action/advocacy. However, the current economic recession, which began in December 2007, has undoubtedly had an impact on many of the indicats repted in Communities Count Even as it went to print, conditions in our communities were changing. In response to the many requests we have received f me timely infmation and new infmation related to the economic downturn, we will be updating our indicats as new data become available. In addition, we will add supplemental data likely to be related to the impact of this recession. Updates can be found at Page 2 of 10

3 BASIC NEEDS AND SOCIAL WELL BEING Affdable Housing Last updated: 08/28/2009 Next scheduled update: November f 3 rd quarter 2009 Home prices continue to decline, narrowing the affdability gap in the county. In the second quarter of 2009, the median home price in King County dropped to $387,500, a decline of 13.9% over the same period in 2008, accding to the Washington Center f Real Estate Research (WCRER). The Nthwest Multiple Listing Service repted in July 2009 that the median price f a single family home had dropped 13.7% in the past year to $384,000. The median price of a condominium was $250,000 in July The Housing Affdability Gap f median income home buyers in King County was repted in Communities Count 2008 as $205,500 the difference between what is affdable f a median household income and a median priced home. Although that gap has narrowed to $138,000, f a household with the median income of $67,010, the median home price would still exceed 30% of income. A home price of $249,500 would be affdable f a median income household. Measured by another standard, WCRER has repted that a median home price is now affdable f households earning the median family income ($81,965). This excludes single-person and non-family households. Single-person and other non-family households, which in 2007 represented 42% of all King County households, are less likely to be at this income level. An affdable purchase price f first-time homebuyers, assumed to have an income of 70% of median household income, would be $174,700. The gap remains wide between what a first-time purchaser can affd and the current median price of a condominium ($250,000) of a starter home ($329,375 85% of median price of a single family home). Sources: Washington Center f Real Estate Research and Nthwest Multiple Listing Service. Page 3 of 10

4 Living Wage Last updated: 08/31/2009 Next scheduled update: September 2009 f Calendar Year 2008 Living Wage, Percent of Jobs in That Pay Less Than a Living Wage in King County and Ratio of Job Seekers to Living Wage Job Openings in Washington State By Household Type, 2006 and 2007 Household 1 Household 2 Household 3 Household 4 Household 5 Single Adult Single Adult with a Two adults(one Two adults(both Single Adult with a schoolage child (6-8 months) and a toddler and a toddler and a toddler(12-24 wking) with a wking) with a years) school-age child school-age child school-age child Living Wage, 2006 King County $25,685/year $40,694/year $58,293/year $49,812/year $71,374/year* Jobs Paying Less Than a Living Wage, 2006 King County $12.35/hour $19.56/hour $28.03/hour $23.95/hour $34.31/hour* 24% 52% 76% 64% 46% Living Wage, 2007 King County Job Seekers per Job Opening Paying Living Wage, Washington State $27,269/year $43,326/year $62,046/year $52,645/year $76,170/year* $13.11/hour $20.83/hour $29.83/hour $25.31/hour $36.62/hour* :1 3:1 4:1 6:1 8:1 10:1 6:1 8:1 * Two wking adults would need a combined income of this amount -- Living wage data are taken from the 2007 and 2008 repts by the Nthwest Foundation of Community Organizations ( The latest available wage and employment data are from Therefe, these results do not reflect the impacts of the economic downturn beginning in Data on job openings that pay less than a living wage are only available by state at this time. The percent of jobs paying less than a living wage did not change substantially from 2006 to 2007 while the amount income need to meet basic needs increased slightly However, the ratio of job seekers to job openings paying a living wage has increased. F every job opening offering a living wage f a single person, the number of job seekers has increased from 2 to 3. In Washington State, f every job opening paying a living wage f a family of two adults (one wking) and two children, there are now8 job seekers on average compared to 6 job seekers the previous year. The situation has most likely become far me severe. In July 2007, the employment rate f King County was 3.5%. Unemployment stood at 8.5% in July Page 4 of 10

5 Bankruptcies Last updated: 08/28/2009 Next scheduled update: Monthly f previous month. U.S. Bankruptcy Court-Seattle Bankruptcy Filings (All types) Year-Over-Year Comparison April May June July % % change change % change % change % % % % The U.S. Bankruptcy Court releases data on cases filed through the Western District, Seattle court, on a monthly basis. Many of the cases filed with the Seattle court come from outside of King County. In August, the court released statistics f King County f the first half of In this period in King County, 3,276 bankruptcy petitions (all types) were filed, an increase of 61% over the first half of Additional infmation on bankruptcies in Western Washington is available on the U.S. courts website. Bankruptcy statistics can be found at Bankruptcy Overview: Bankruptcies in King County are generally handled through the Federal Bankruptcy Court in Seattle. Individuals can file under either Chapter 7 Chapter 13. Businesses usually file under Chapter 11. Chapter 7, entitled Liquidation, contemplates an derly, court-supervised procedure by which a trustee takes over the assets of the debt's estate, reduces them to cash, and makes distributions to credits, subject to the debt's right to retain certain exempt property and the rights of secured credits. Because there is usually little no nonexempt property in most chapter 7 cases, there may not be an actual liquidation of the debt's assets. These cases are called "no-asset cases." If such a debt's income is in excess of certain thresholds, the debt may not be eligible f chapter 7 relief. Chapter 13, entitled Adjustment of Debts of an Individual With Regular Income, is designed f an individual debt who has a regular source of income. Chapter 13 enables the debt to keep a valuable asset, such as a house, and to propose a "plan" to repay credits over time usually three to five years. Chapter 13 is also used by consumer debts who do not qualify f chapter 7 relief under the means test. Chapter 11, entitled Reganization, dinarily is used by commercial enterprises that desire to continue operating a business and repay credits concurrently through a court-approved plan of reganization. The debt nmally goes through a period of consolidation and emerges with a reduced debt load and a reganized business. Page 5 of 10

6 Home Feclosures Last updated: 8/28/2009 Next scheduled update: Monthly f previous month. 200% Notice of Trustee Sales Recded in King County, Jan July Change in monthly rate from previous year 150% 100% 50% 0% Number of "Notice oftrustee Sales" Recded -50% 0 Jan-05 Mar-05 May-05 Jul-05 Sep-05 Nov-05 Jan-06 Mar-06 May-06 Jul-06 Sep-06 Nov-06 Jan-07 Mar-07 May-07 Jul-07 Sep-07 Nov-07 Jan-08 Mar-08 May-08 Jul-08 Sep-08 Nov-08 Jan-09 Mar-09 May-09 Jul-09 Change in month from previous year Number of Notice of Trustee Sales' Recded Feclosures (NTS) dropped from 1,615 in June 2009 to 1,248 in July The yearover-year increase in July was 81%. A new PolicyLink tool, "Reclaiming Feclosed Properties f Community Benefit", highlights promising practices that are already underway f localities looking to stabilize their local housing market and prevent blight from spreading. Source: King County recder: Data were queried monthly by 'Notice of Trustee Sale' Page 6 of 10

7 Feclosure Overview & Feclosure Process What is Feclosure? Feclosure is a process that allows a lender to recover the amount owed on a defaulted loan by selling taking ownership (repossession) of the property securing the loan. The feclosure process begins when a brower/owner defaults on loan payments (usually mtgage payments) and the lender files a public default notice, called a Notice of Default. The feclosure process can end one of four ways: 1. The brower/owner reinstates the loan by paying off the default amount during a grace period determined by state law. This grace period is also known as pre-feclosure. 2. The brower/owner sells the property to a third party during the pre-feclosure period. The sale allows the brower/owner to pay off the loan and avoid having a feclosure on his her credit histy. 3. A third party buys the property at a public auction at the end of the pre-feclosure period. 4. The lender takes ownership of the property, usually with the intent to re-sell it on the open market. Properties repossessed by the lender are also known as bank-owned REO properties (Real Estate Owned by the lender). Maj Elements of Washington Feclosure Include: 1. Mailing and posting the Notice of Default (at least 30 days after default occurs). 2. Setting the Trustee's Sale that includes recding mailing and posting of the Notice of Trustee's Sale (must be done me than 90 days befe sale date). 3. Publication - 2 times at specific intervals in the last month befe sale. 4. Holding the Sale (Must be at least 190 days after date of first default, 90 days after NTS is posted) 5. Sales can be continued up to 120 days at the will of the lender. Measuring/Indicating Feclosure The Notice of Trustee Sale (NTS) is filed at least 30 days after the notice of default. There is no single point in the process that the experts call a feclosure. All NTS must be recded with the King County Recder s Office, but preliminary steps don t have to be. Therefe NTS is usually regarded as the best available marker of feclosure: it indicates a default that will turn into loss of the property unless something big and costly happens. In Washington, the sale takes place no sooner than 90 days after the NTS is filed, and can be called off at any point if the debt is paid restructured. Source: Page 7 of 10

8 Unemployment Last updated 08/28/2009 Next scheduled update: Monthly f pri month 12% Unemployment Rates U.S., Washington State, & Seattle/Bellevue/Everett Metro Area Seasonally Adjusted 10% 9.1% 9.4% 9.1% 8% 6% 4% 5.6% 5.2% 4.5% 6.2% 5.5% 7.2% 6.5% 8.5% U.S. 8.9% 2% Washington State Seattle Metro Division 0% JUN '08 JUL '08 AUG '08 SEP '08 OCT '08 NOV '08 DEC '08 JAN '09 FEB '09 MAR '09 APR '09 MAY '09 JUN '09 JUL '09 12% Unemployment Rates King County Not Seasonally Adjusted 10% 8% 8.0% 8.5% 6% 5.6% 4% 4.1% 4.6% 2% 0% JUN '08 JUL '08 AUG '08 SEP '08 OCT '08 NOV '08 DEC '08 JAN '09 FEB '09 MAR '09 APR '09 MAY '09 JUN '09 JUL '09 The employment picture in King County brightened somewhat in July 2009 over the previous month. The number of employed persons rose by 9,210 while the Page 8 of 10

9 unemployment level declined by 2,720, resulting in an unemployment rate that moved downward to 8.5 percent. This change reflects a.3 percentage point decrease over a revised June estimate of 8.8 percent. Unemployment in the county remains slightly below the national, state and metropolitan area level. The state unemployment rate decreased from 9.2 to 9.1 percent in July. The U.S. unemployment rate reflected a similar decrease, shifting downwards from 9.5 percent in June to 9.4 percent in July. Source: Washington State Employment Security Department, Lab Market and Economic Analysis Branch. What does SEASONALLY ADJUSTED mean? Over the course of a year, the size of the state s lab fce and the levels of employment and unemployment undergo sharp fluctuations due to such seasonal events as changes in weather, reduced expanded production, harvests, maj holidays, and the opening and closing of schools. The effect of such seasonal variation can be very large; seasonal fluctuations may account f as much as 95 percent of the month-to-month changes in unemployment at the national level. Because these seasonal events follow a me less regular pattern each year, their influence on statistical trends can be eliminated by adjusting the statistics from month to month. These adjustments make nonseasonal developments, such as declines in economic activity, easier to spot. F example, the large number of youth entering the lab fce each June is likely to obscure any other changes that have taken place relative to May, making it difficult to determine if the level of economic activity has risen declined. However, because the effect of students finishing school in previous years is known, the statistics f the current year can be adjusted to allow f a comparable change. The adjusted figure provides a me useful tool with which to analyze changes in economic activity. Source: U.S. Bureau of Lab Statistics Page 9 of 10

10 Websites and Repts with Recession-relevant Data and Analysis United Way of King County Community Assessment: Basic Needs Examining the Health Consequences of the Recession PolicyLink Reclaiming Feclosed Properties f Community Benefit highlights promising practices that are already underway f localities looking to stabilize their local housing market and prevent blight from spreading. Demos and the Center f Responsible Lending The Plastic Safety Net: The Reality Behind Debt in America, Tamara Draut, October 2005, Page 10 of 10