In the Center for Responsible Lending's December 2006 study, “Losing Ground,” CRL predicts that millions of American households will lose their homes to foreclosures in the subprime mortgage market.
“Losing Ground” focuses on the direct impact of subprime foreclosures, but it does not attempt to quantify how those foreclosures affect neighboring homes and larger communities. In other words, it does not address the “spillover” effect where foreclosures themselves further depress local housing prices.
In this report, the Center estimates how many homes—including families who are paying their mortgage on time—will suffer a decline in property values because of foreclosures in their neighborhoods. The Center also estimates the monetary value of these losses in terms of lower property value and a reduced tax base for communities.
Pew is no longer active in this line of work, but for more information visit the Subprime Mortgages Project on PewHealth.org.