Future Foreclosure Hotspots You Would Not Believe

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When we talk about foreclosure central, everyone assumes we are talking the sand states -- Las Vegas, where, in 2010, one out of every nine households received a foreclosure notice, Phoenix, or Florida. Yep, still hot foreclosure areas, but there are others out there that may surprise. These are cities where times may have been very good just a few years ago, and no bubbles can be blamed for esalting prices. Still, these areas are saturated with foreclosures.

Rick Sharga, vice president of RealtyTrac, the Irvine, Calif., company that tracks foreclosures, says the dreaded "F-word" will likely set yet another record in 2011. The number of bank repossessions could go up by as much as 20 percent this year, he says, and overall foreclosure activity will probably go up by a similar amount in places you've never dreamed of.

Charlotte on My Mind: When the Democratic National Convention heads to Charlotte, N.C., next year, it may get more economic news than it bargained for. Charlotte, with its gleaming banking centers and mere 10 percent unemployment rate, is in store for a rash of foreclosures. In fact, Charlotte was one of the state's hardest hit areas and suffered mortgage defaults from changing economic fortunes even as it grew to become the 33rd largest metro area in the nation. With a population of 1.7 million, Charlotte is expected to see one in 50 homes foreclosed on, or a 37 percent increase in foreclosures from 2009.

No Sparing Spartanburg: Looking south, Spartanburg, S.C., may be the fastest-growing region in the state but it is also has the fastest growing foreclosure rate -- a whopping 228 percent spike in filings. One in 60 homes will be served with foreclosure papers thanks to two converging
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trends: a plethora of questionable mortgages used during the boom, and an unemployment rate of 12.7 percent in 2009 that recently dropped to 10.9 percent. Two reasons for the spike: When employees were laid off, they couldn't pay their mortgage, and then some people participated in questionable mortgages on investment homes.

No Miracle for Myrtle Beach: Even the lure of the beach, which entices most vacation home buyers, has not kept foreclosures from washing up Myrtle Beach real estate. With a 2.25 percent foreclosure rate, and 44 percent increase in 2010 and 446 percent in 2009, most of the foreclosures are second homes that put buyers underwater when the market turned. At 263,866, Myrtle Beach's population is growing so fast it is now the nation's 11th fastest-growing city. But the city's major industry, tourism, was hurt by the recession. The area's unemployment rate had been over 12 percent, and was still 11.8 percent last November.


Mobile's Mortgage Mess: The economy was so strong, Mobile, Ala., really didn't feel the recession until 2010, when the area's unemployment soared to 12.6 percent last January. In 2007, the unemployment rate was a scant 3 percent! As the economy slowed, job losses rose in key industries, especially construction, paper products and, after the oil spill, the shrimp, oyster and fish industries. And even though the housing market was on an even keel with little overbuilding, when the pink slips came foreclosure filings increased 28 percent in 2010 after jumping 85 percent the year prior. With a population of 412,000, Mobile had a 1.79 percent foreclosure rate, or an increase of 28 percent.

York's Yearnings: The home of the York Peppermint Pattie had unusually robust growth for a Rust-belt city during the boom, and the Pennsylvania's city's housing prices were not insane. So with affordable homes and moderate job losses -- 8.2 percent unemployment rate -- why is York even on this list? With a population of 429,000, one in 56 homes is in foreclosure, a 28 precent increase. Local experts say it's the area's slow economy and a lag that Pennsylvania often has, following national trends one step behind. Experts for see little improvement in 2011.

Virginia Beach Bingo: Bubble town. From 2002 to 2006, home prices soared in Virginia Beach, Va., as home buyers dabbled in exotic mortgage products, even service people with access to cheap government VA financing. So this area mirrored bubble markets in California, Florida, Nevada and Arizona. With a population of 1.7 million, one in 54 homes went into foreclosure or a hefty 31 percent of the market. This in a market with a relatively low unemployment rate of 7.2 percent. With all those servicemen, Virginia Beach expects an employment swell of 10,000 jobs in 2011.

New Orleans Foreclosure City: One in 57 New Orleans homes is in foreclosure, a 36 percent increase over 2010, which is not good news for this disaster-ridden city. Oh the calamities NOLA has suffered, from high crime, Katrina, quasi leadership, the Gulf oil spill. The job picture darkened, with the unemployment rate jumping to 7.6 percent. And NOLA residents have a mean household income of just $47,188, nearly ten percent below the national median. So not a population of terrifically qualified buyers. Most foreclosures in NOLA resulted from economic factors, no jobs, no income, rather than exotic financing. The 36 foreclosure filing jump in 2010 came on the heels of a 79 percent increase in 2009 and was enough to push the New Orleans metro into RealtyTrac's top 100 worst cities for foreclosures.

Tulsa Not So OK: OK, another head scratcher. Tulsa learned its lesson in the '80s oil bust and diversified it's economy. There are jobs in Tulsa, and unemployment has been running well below national levels, although the rate increased to 7.5 percent in November from 7.2 percent a year. The housing market never bubbled and there's a great deal of room for development, so home prices have remained affordable, with a median price of $142,000 at the end of the third quarter of 2010, according to the National Association of Home Builders. Population just under a million, so why are one in 50 Tulsa homes going into foreclosure with a 37 percent increase in the foreclosure rate over 2010? Job losses. They triggered a jump of 68 percent in foreclosure filings in 2009; by that number, 37 percent is a bright sign.

Savannah on my Mind: This beautiful, historic southern town has had an increase in unemployment as of late -- 37 percent in 2010. As a result, one in 40 homes is in foreclosure. And the economic recovery for 343,000 Georgians has lagged. A few years ago, most area foreclosures were in Savannah's Historic District or The Landings, charming neighborhoods where home prices were quickly bid up during the boom and plummeted in the bust. Now, most of the area's new foreclosures are concentrated in less fashionable communities, according to experts, and investors buying these up are having trouble renting them.
Albuquerque, Que Pasa?: Albuquerque was one of the nation's fastest-growing metro areas over the past decade, pulling in a youthful, educated population for the plentiful jobs and warm, arid climate. Then came the recessionary brakes, and Albuquerque has been slow to recover. Unemployment is increasing, rising to 8.6 percent in November from 7.8 percent a year earlier. And here's the danger when housing makes up part of the jobs: the metro area lost 13 percent of its construction jobs last year. All those layoffs put many people behind on their mortgage payments. Beautiful Albuquerque had the 67th highest foreclosure rate in 2010 among the 206 areas reported on by RealtyTrac. With a population of 529,000, one in 46 homes was in foreclosure with a whopping 60.32 foreclosure increase in 2010.


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