10 States Missing Out on the Housing Recovery

Even with mortgage rates at historically low rates, existing home sales slowed to an annual 6.1% growth rate in November, the National Association of Realtors reports. Though the share of first-time homebuyers (31%) was the largest it’s been since Oct. 2012.

Meanwhile, the foreclosure rate was down slightly (1%) in November from the same time last year, with one in every 1,170 U.S. housing units in some stage of foreclosure, according to the November RealtyTrac U.S. Foreclosure Market Report.

So continues the slow recovery of the U.S. housing market. Still, some states aren’t keeping up with the meager national improvements. To get an idea of which states are lagging most in the housing recovery, we looked at a few data points by state: mortgage originations per capita (rounded, using U.S. Census data), 90-day mortgage delinquency rate, average credit score (the VantageScore model) and foreclosure rate. The foreclosure data comes from November’s RealtyTrac report, while the rest is third-quarter 2014 Experian Intelliview data.

10 States Missing Out on the Housing Recovery

We ranked each state from worst to best in each category and added the rankings (weighted equally) to reach a housing market score, the worst possible score being 4 and the best being 204 (the District of Columbia was included). This isn’t meant to be a definitive analysis of the housing markets in each state, but rather a temperature reading of general housing health. After all, a high foreclosure rate, low mortgage origination rate, high mortgage delinquency rate and low average credit score don’t exactly make a state market ripe for housing growth.

10. Maryland

Mortgage origination per capita: 0.0054 (23rd lowest)
Foreclosure rate: 1 in every 581 units (3rd highest)
Delinquency rate: 2.49% (10th highest)
Average VantageScore: 664 (21st lowest)

9. Alabama

Mortgage origination per capita: 0.0037 (5th lowest)
Foreclosure rate: 1 in every 1,379 units (20th highest)
Delinquency rate: 1.92% (22nd highest)
Average VantageScore: 650 (9th lowest)

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8. Mississippi

Mortgage origination per capita: 0.0023 (lowest of any state)
Foreclosure rate: 1 in every 5,663 (45th highest)
Delinquency rate: 2.52% (8th highest)
Average VantageScore: 635 (lowest of any state)

7. North Carolina

Mortgage origination per capita: 0.0039 (6th lowest)
Foreclosure rate: 1 in every 1,051 units (13th highest)
Delinquency rate: 2.24% (14th highest)
Average VantageScore: 658 (17th lowest)

6. New Jersey

Mortgage origination per capita: 0.0042 (10th lowest)
Foreclosure rate: 1 in every 478 units (2nd highest)
Delinquency rate: 3.31% (2nd highest)
Average VantageScore: 678 (33rd lowest)

5. Nevada

Mortgage origination per capita: 0.0052 (22nd lowest)
Foreclosure rate: 1 in every 783 units (6th highest)
Delinquency rate: 2.87% (3rd highest)
Average VantageScore: 637 (2nd lowest)

4. Georgia

Mortgage origination per capita: 0.0039 (7th lowest)
Foreclosure rate: 1 in every 1,025 units (11th highest)
Delinquency rate: 2.33% (11th highest)
Average VantageScore: 645 (3rd lowest)

3. Delaware

Mortgage origination per capita: 0.0035 (3rd lowest)
Foreclosure rate: 1 in every 693 units (4th highest)
Delinquency rate: 2.77% (4th highest)
Average VantageScore: 661 (19th lowest)

2. South Carolina

Mortgage origination per capita: 0.0041 (8th lowest)
Foreclosure rate: 1 in every 933 units (10th highest)
Delinquency rate: 2.75% (5th highest)
Average VantageScore: 649 (6th lowest)

1. Florida

Mortgage origination per capita: 0.0042 (11th lowest)
Foreclosure rate: 1 in every 462 (highest of any state)
Delinquency rate: 3.95% (highest of any state)
Average VantageScore: 657 (16th lowest)

Mortgage originations, foreclosure rates and delinquency rates give a strong indication of how things are going in the state’s housing market, but the credit score adds another level of insight, because it’s harder to get a mortgage with a low credit score.

Mortgage credit, which has been extremely tight in recent years, is expected to open up in 2015. First-time homebuyers will have the opportunity to make lower down payments, as well. Even with those expected improvements, good credit is paramount in getting through the mortgage process. Before you think about home shopping or applying for a mortgage, get a free summary of your credit report on Credit.com and see how you can improve your score in the coming months. You can also use this calculator to see how much house you can afford.