Chesterfield County’s real estate market hasn’t escaped the foreclosure bug, but it’s not as bad as in other parts of the state. According to RealtyTrac, there were 186 new foreclosure filings in the county in January, the last month for which data are available. That’s 10 more than were reported at the same time last year, but 21 fewer than in December.
The number of Chesterfield foreclosure filings showed an upward spike starting in January 2008, averaging about 115 per month since then, with the climax coming in December, when filings hit a high of 207.
According to data compiled and analyzed by California-based mortgage research firm First American CoreLogic, 19 percent of the more than 1 million mortgages held in the commonwealth during December were reported to be “underwater” or “upside-down,” meaning homeowners owed more than their homes were worth.
But although Northern Virginia and Hampton Roads continue to struggle with foreclosures, negative equity and sluggish sales, the Richmond metropolitan area and Chesterfield County have so far managed to avoid the worst of the housing crisis.
“I think people sometimes get sidetracked by the numbers they hear on the national news,” said Kelly Surmacewicz, director of communications for the Richmond Association of Realtors. “I don’t want to say it’s an insulated market. We see the same things here that people see on the national level, but to a much lesser extent.”
Although First American CoreLogic’s data showed the rate of foreclosures in the Richmond metro area almost doubled (from 0.40 percent to 0.70) in December compared with the previous month, that number is still less than half of the national foreclosure rate of 1.7 percent.
In fact, some areas are still very much in demand, such as the 23114 Zip code. Although Chesterfield home resale prices fell by an average of 4 percent over the past 12 months, homes in the Midlothian sold for 0.2 percent more.
First-time homebuyers are also helping keep the local housing market afloat. Attracted by record-low interest rates and the Obama administration’s $8,000 tax credit, Mulligan sees more renters being drawn toward purchasing a home with each passing day.
These new homeowners won’t solve the problem of the existing inventory of foreclosed homes, however.
“First-time homebuyers are a little wary of foreclosures and short sales because most of those houses are sold ‘as is,'” Mulligan said. “You can get in one of those homes for far less than the assessed value, but you’re probably going to have to spend money to fix it up.”
Foreclosed homes act as a drag on home values throughout the neighborhoods in which they are located. So do homes vacated through a “short sale,” in which the lender agrees to accept less than is owed on the mortgage.
Chesterfield County foreclosure filings
2007 2008 2009
January 11 176 186
February 7 86 –
March 4 91 –
April 11 94 –
May 11 114 –
June 12 98 –
July 5 101 –
August 20 89 –
September 25 112 –
October 23 118 –
November 30 98 –
December 52 207 –
Source: RealtyTrac U.S.
A version of this story first ran in the Chesterfield Observer, which is an RBS news partner.