Caught in the web of the real estate crisis, Ohio home values are falling at some of the fastest rates of deflation amid a record inventory of foreclosed properties, which are only expected to increase as the second round of the nation's foreclosure epidemic strikes in 2009.
One of the nation's most radical plans to deal with the foreclosure epidemic is moving through the state Senate in Ohio. Foreclosed homes that have fallen into disrepair would be destroyed under the plan. The measure is similar to that of a similar plan adopted in hard hit Michigan.
Cleveland is one of the hardest hit cities in the foreclosure epidemic, especially East Cleveland, where home prices have dropped an incredible 80% plus since the crisis began. The median home sales price is down nearly half from its peak in Cleveland, which still has a long way to go to wade through the credit crisis and the souring national economy.
Lack of consumer confidence and a recessionary national economy are slowing Cleveland home sales. However, foreclosures are at least aiding the market's home sales activity. They'll be an increasing inventory of foreclosures to choose from in 2009.
 |
| City |
Forecast |
| Columbus |
− 11.3% |
| Cincinnati |
− 7.0% |
| Cleveland |
− 13.7% |
| Dayton |
− 10.6% |
| Toledo |
− 10.1% |
Cleveland will near the bottom of its market during the year with forecast average housing deflation of 13.7%. The city that's so well known for having the Rock and Roll Hall of Fame will be rocking for a while yet in its housing market.
In Columbus, the inventory of homes has climbed. Slow market conditions are forcing homeowners to make concessions of all sorts if they really want or need to sell. Sales are below what they were last year, and are projected to fall off in 2009 as the economy worsens. Average housing values in Columbus are forecast to deflate an additional 11.3% in 2009.
Greater Cincinnati home sales are dropping at double digit rates as perspective buyers find it harder and harder to get mortgages. The rate of deflation, however, has remained in single digits for the year as home sales slump. The foreclosure market isn't as bad in Cincinnati as elsewhere in the state. But a weakening economy, hurt by the auto industry is hurting the housing market.
The average home will devalue an additional forecast 7.0% in Cincinnati as the area deals with the nation's recession started in the mortgage markets and on Wall Street.
Job losses in Toledo are contributing to a weakening economy that has produced a slowing real estate market. Employment levels are the leading indicator of housing markets, and the deteriorating conditions in Toledo are making it tough for many homeowners to hold on to their homes. The inventory of homes for sale is rising as the job market falls.
Auto industry related job losses at Jeep and Chrysler are making the situation worse. As a consequence of more expected lay offs, Toledo is projected to have fewer home sales in 2009, and worsening forecast housing deflation of 10.1% on average in 2009.
Home sales are on a downward spiral in Dayton, which is seeing losses in sales nearly every month. The economic crisis is proving painful for the local economy as it deals with the credit crisis that has hit all of Ohio severely. But by comparison, Dayton is weathering the storm better than many other parts of the state since it didn't experience as high of housing inflation during the boom.
The existing home inventory is growing with the onslaught of foreclosures. Housing Predictor forecasts Dayton homes to deflate an average of 10.6% in 2009.
