Massachusetts Foreclosure Activity Remains Slow
The housing recovery for Massachusetts is in full effect as foreclosure petitions, foreclosure deeds and auction announcements all dropped by double-digit percentages in September from last year.
The number of foreclosure deeds recorded in the Bay State continued to improve, as there were only 247 logged in September, which is 52% less than a year ago. Foreclosure deeds peaked in May 2008 when 1,405 were recorded, according to the Boston-based data firm The Warren Group.
So far in 2013, a total of 2,382 foreclosure deeds have been filed. This is a 63% decrease from the same time period in 2012 when 6,491 were completed.
Meanwhile, a 69% decline was seen in foreclosure petitions on an annual basis in September from 1,420 to 438, respectively. There have been 4,174 foreclosure petitions initiated in 2013, down 70% year-over-year.
Additionally, the number of auction announcements tracked by The Warren Group also fell in September by 19% to 729 from 902 on a yearly basis.
“The foreclosure numbers in September further bolster the opinion that foreclosures are in full retreat,” said Timothy M. Warren Jr., CEO of The Warren Group. “It’s been a solid year of foreclosure decreases, indicating the worst of the housing crisis is over.”
With foreclosure activity statewide declining for the 16th consecutive month year-over-year, the local real estate market is booming. Sales volume and median prices grew at double-digit rates in the third quarter, Warren says, with 28 communities having median prices that are higher than the pre-crash peak in 2005, which means that selling a home is really a viable alternative to foreclosure.
“People who can’t make their mortgage payments might have a home to pay off the mortgage,” Warren says. “The market is so hot these days that 30% to 40% of homes sell at or above the asking price. So, fewer and fewer homeowners are underwater on their mortgages and those that still owe more than their homes are worth are holding on, hoping that prices continue to rise.”
There is optimism that the foreclosure picture will continue to get better over the next couple of months.
“Government programs make loan modifications a realistic opportunity for many delinquent homeowners,” Warren says. “The new state law in Massachusetts forces all lenders to consider all alternatives to foreclosure and to do an analysis to determine if any alternative is more cost effective. So I think we’ll see the numbers drop even further.”