Three of Four Vacant Residential Properties in U.S. are Investment Homes

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According to ATTOM Data Solutions 2017 U.S. Residential Vacant Property and Zombie Foreclosure Report, nearly 1.4 million (1,367,793) U.S. residential properties (1 to 4 units) were vacant as of the end of the third quarter of 2017 -- representing 1.58 percent of all U.S. residential properties.
 
The 1.58 percent vacant property rate nationwide decreased slightly from 1.63 percent a year ago, but vacant property rates increased from a year ago in 81 of the 149 metropolitan statistical areas analyzed in the report (54 percent), including Chicago, New York, St. Louis, Baltimore and Phoenix.  
 
The report also shows that the number of vacant "zombie" pre-foreclosure properties -- which have started the foreclosure process but have not yet been repossessed by the foreclosing lender -- decreased 22 percent from a year ago to 14,312 as of the end of Q3 2017, 67 percent below the peak of 44,030 in Q3 2013. The number of vacant bank-owned properties decreased 48 percent from a year ago to 24,026 as of the end of Q3 2017.
 
"Zombie foreclosures have dwindled dramatically over the last four years as a supply-starved housing has soaked up even some of the most highly distressed properties," said Daren Blomquist, senior vice president at ATTOM Data Solutions. "There are still pockets of the country with high zombie foreclosure rates, and high vacant property rates in general, primarily in the Rust Belt and parts of the Northeast and Southeast -- driven in large part by a high share of non-owner occupied vacant properties in those areas.
 
"There is evidence that the ultra-tight inventory environment in some red-hot markets is beginning to ease just a bit, with vacant property rates nudging higher in markets such as San Jose, San Francisco, Los Angeles, Boston and Denver," Blomquist added.
 
Zip codes where one in four residential properties is vacant
 
States with the highest vacancy rates were Mississippi (3.00 percent); Michigan (2.94 percent); Indiana (2.77 percent); Oklahoma (2.73 percent); and Alabama (2.56 percent).
 
Among 149 metropolitan statistical areas with at least 100,000 residential properties (1 to 4 units), those with the highest vacancy rates were Flint, Michigan (6.89 percent); Youngstown, Ohio (4.49 percent); Beaumont-Port Arthur, Texas (3.80 percent); Detroit, Michigan (3.77 percent); and Mobile, Alabama (3.77 percent).
 
Among 405 counties with at least 50,000 residential properties, those with the highest vacancy rates were Baltimore City, Maryland (8.14 percent); Saint Louis City, Missouri (6.97 percent); Beaufort County, South Carolina (6.94 percent); Genesee County, Michigan (6.89 percent); and Wayne County, Michigan (6.76 percent).
 
Among 13,616 U.S. zip codes with at least 1,000 residential properties, those with the highest vacancy rates were led by three zip codes in the city of Gary, Indiana: 46409 (30.26 percent); 46407 (29.62 percent); and 46402 (29.53 percent), followed by 48505 in Flint, Michigan (29.00 percent); and 44507 in Youngstown, Ohio (25.97 percent).
 
9 percent of zip codes have no vacant residential properties
 
States with the lowest vacancy rates were South Dakota (0.25 percent); Vermont (0.39 percent); New Hampshire (0.42 percent); North Dakota (0.69 percent); and Colorado (0.69 percent).
 
Among 149 metropolitan statistical areas with at least 100,000 residential properties, those with the lowest vacancy rates were San Jose, California (0.23 percent); Fort Collins, Colorado (0.24 percent); Lancaster, Pennsylvania (0.26 percent); Manchester, New Hampshire (0.31 percent); and Provo, Utah (0.34 percent).
 
"The low vacant property rates in the Seattle region are good for landlords and sellers but not so good for buyers or renters," said Matthew Gardner, chief economist at Windermere Real Estate, covering the Seattle market, where the 0.9 percent vacant property rate was well below the national average and ranked No. 41 lowest among the 149 metro areas analyzed in the report. "It is indicative of the very hot housing market in Seattle and I believe that the percentages could drop even further as we move into 2018."
 
Among 405 counties with at least 50,000 residential properties, those with the lowest vacancy rates were Loudon County, Virginia (0.09 percent); Douglas County, Colorado (0.10 percent); Spotsylvania County, Virginia (0.12 percent); Hays County, Texas (0.12 percent); and Shelby County, Alabama (0.14 percent).
 
Among 13,616 U.S. zip codes with at least 1,000 residential properties, there were 1,282 zip codes with no vacant residential properties, including 28078 in Huntersville, North Carolina; 85383 in Peoria, Arizona; 34110 in Naples, Florida; 33018 in Hialeah, Florida; and 94546 in Castro Valley, California.
 
Most zombie foreclosures in New York, New Jersey, Florida, Illinois, Ohio
 
Nationwide a total of 14,312 properties in the foreclosure process were vacant as of the end of Q3 2017, representing 4.18 percent of all properties in foreclosure.
 
States with the most of these vacant "zombie" foreclosures were New York (3,528), New Jersey (2,261), Florida (1,963), Illinois (999), and Ohio (974).
 
Among 149 metropolitan statistical areas with at least 100,000 residential properties (1 to 4 units), those with the most vacant "zombie" foreclosures were New York-Newark-Jersey City, NY-NJ-PA (3,106); Philadelphia, Pennsylvania (813), Chicago, Illinois (665), Miami, Florida (571), and Tampa-St. Petersburg, Florida (477).
 
Most vacant REOs in New York, Chicago, Philadelphia, Baltimore, Cleveland
 
Nationwide a total of 24,026 bank-owned (REO) residential properties were vacant as of the end of Q3 2017, representing 15.33 percent of all bank-owned properties and down 48 percent from a year ago.
 
States with the most vacant REO properties were Michigan (2,265), Ohio (2,213), Florida (2,087), New Jersey (2,017), and Illinois (1,561).
 
Among 149 metropolitan statistical areas with at least 100,000 residential properties (1 to 4 units), those with the most vacant REO properties were New York-Newark-Jersey City, NY-NJ-PA (1,494); Chicago, Illinois (1,375); Philadelphia, Pennsylvania (1,007); Baltimore, Maryland (971); and Cleveland, Ohio (928).
 
75 percent of vacant properties are non-owner occupied (investment)
 
Nationwide more than 1 million non-owner occupied (investment) residential properties (1,032,851) were vacant, representing 4.30 percent of all non-owner occupied residential properties and unchanged from a year ago.

States with the highest vacancy rate for non-owner occupied (investment) properties were Michigan (9.84 percent); Indiana (9.52 percent); Kansas (7.11 percent); Mississippi (6.92 percent); and Alabama (6.83 percent).
 
Among 149 metropolitan statistical areas with at least 100,000 residential properties (1 to 4 units), those with the highest vacancy rate for non-owner occupied (investment) properties were Flint, Michigan (23.64 percent); Youngstown, Ohio (12.01 percent); Detroit, Michigan (11.88 percent); South Bend, Indiana (10.47 percent); and Indianapolis, Indiana (10.46 percent).