Cleveland, Columbus lagging Cincinnati

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Fears of recession have become reality.  The housing market melt-down continues to be at the center of the economic and financial crisis.

Ohio has had the dubious distinction of appearing among the ranks of those states with foreclosure rates higher than the national average.  In the latest release of the Mortgage Bankers Association's National Delinquency Survey, Ohio, Florida, Nevada and several other states ranked among those with highest foreclosure stats.  There are stories of the proliferation of bank-owned properties in almost every neighborhood.

Although interesting, the national rankings have a fairly limited picture of the conditions of the economy and the housing market in any particular state.

For one, the national reports focus on statewide averages, which frequently obscure the varying economic and housing market conditions across major metropolitan regions.

Ohio's three major metropolitan areas, Cincinnati, Columbus and Cleveland, are economically diverse, as are their respective counties of Hamilton, Franklin and Cuyahoga.  Each region represents a unique population and economic conditions.

While Ohio's statewide foreclosure rate has been above the national average for at least two quarters in 2008, each county actually fares quite differently.

According to the data from the Federal Reserve Bank of New York, at the end of the second quarter of 2008, more than 4 percent of Cleveland's Cuyahoga County households were 90 days or more delinquent on their mortgage payments, compared to about 3 percent in Franklin County, and just over 2.5 percent in Hamilton County.  Not only did Cuyahoga County have the highest delinquency rates of the three counties, it also had the largest increase in the mortgage delinquency rate.

Thus, as of the middle of 2008, Hamilton County's mortgage market appeared stronger than those of Franklin and Cuyahoga.

Subprime loans offer a similar view.  As of October, the Cleveland area had a greater number of subprime loans per 1,000 owner-occupied housing units than either the Columbus or Cincinnati areas.

Both Franklin and Cuyahoga County had higher shares of subprime loans in foreclosure than Hamilton County.  So, while the housing markets in the metropolitan areas of Cleveland, Columbus and Cincinnati are strugglin, there are significant and important differences among those regions.  In terms of subprime characteristics, delinquencies and foreclosures, the housing market in the Cincinnati metropolitan area is doing better than the other two major metropolitan areas.