Distressed and Pre Foreclosure Homes Affect County Housing Values

by on Foreclosures

Residential property assessors in Jefferson County, Kentucky have reported that nearly 25% of the 260,000 homes in the area are set to have lower values this year, with part of the reason attributed to the presence of pre foreclosure homes and bank owned properties. Property valuators have revealed that housing sales reports in the area showed that around 60,000 residences have lost value by the end of 2010.

The high supplies of Louisville foreclosures for sale and distressed homes in other markets of the region have contributed to the decline in property values in most areas of the state, assessors have reported. Officials have also revealed that the level of property value decline this year is almost unprecedented.

Real estate assessment reports showed that Kentucky foreclosures have a lot of influence on the values of homes in the state. In Jefferson County, residential reports showed that around 5,000 homes were vacant as of the second week of February 2011, with most of these empty properties found in West End communities. These vacant premises, assessors revealed, also influence property values. And so do foreclosures. Housing data revealed that foreclosure sales have continuously risen in the region since 2006, but the biggest jump in total was recorded between 2008 and 2009. 

Pre foreclosure homes and foreclosed residential properties scheduled for sale in 2008 was 3,264, according to county residential data. In 2009, the total rose to 4,382. Last year, the figure jumped again, with scheduled foreclosure sales reaching a total of 6,076, while 2,599 actually ended at the sales block. Assessors reported that this year, the same pace of foreclosure sales will likely be seen.

Property assessment officials stated that there is currently an oversupply of residential properties in the county, with a big percentage of them accounted for by bank foreclosure properties. This, they explained, depresses housing prices and holds back homebuilding activities in the region and also affects property values. Last year, only 639 permits were issued for single family construction projects, demonstrating how bad the foreclosure crisis has affected the house construction sector. Analysts stated that these figures all have bearing on the values of residential properties in the county.

Assessors in Jefferson County stated that as long as there is an oversupply of foreclosed and pre foreclosure homes, values of properties will continue to decline. The impact, most analysts claimed, will be felt largely in the property tax revenue of the area.

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