Foreclosures Are Rising – and in the Wrong Places for Overall U.S. Economy


Home in foreclosure; Getty file photo

After months of declines, foreclosures were up again in August by about 7 percent compared to July. That’s not good news to anyone hoping for an economic turnaround. But look closer at where those foreclosures were in Patchwork Nation’s 12 county types and there is even more to be concerned about.

Numbers from the firm RealtyTrac, analyzed by Patchwork Nation, find that some of the biggest increases were in the nation’s wealthier places: The Monied Burbs and big city Industrial Metropolis counties saw bigger rises. The small town Service Worker Center counties, which have been hit hard in the recession, were also up sharply.

The bumps represent different sets of problems, both disheartening.

First, the increases in the wealthy communities suggest that people in those counties still may be leery of spending money in the months ahead – something they need to do if the economy is to turn around. Second, the rise in the poorer Service Worker counties suggest many in those places that have been struggling to ride out the recession may be starting to hit a wall financially.

There are some positives in the latest report. Some of Patchwork Nation’s county types are seeing better foreclosure numbers – the socially conservative Evangelical Epicenters and aging Emptying Nests, for instance. But the larger question is whether these foreclosure numbers represent the other shoe to drop that many experts were expecting in the housing market.

And unless there is a sudden turnaround in the September foreclosure numbers (something unlikely) the message in these numbers to those running for president in 2012 is clear: See the U.S. economic picture now? Don’t expect it to be prettier by this time next year.