Foreclosure Petitions in Central MA Nearly Double From Last Year
Monday, May 12, 2014
According to a monthly report released by The Warren Group, foreclosure petitions are on the rise in Worcester County. In March of 2014, 106 petitions were reported, nearly doubling from the 56 reported last year.
"With much of the foreclosure crisis behind us and foreclosure procedures well documented, lenders may be getting more aggressive with delinquent borrowers," said Timothy M. Warren Jr., CEO of The Warren Group. "The number of foreclosure starts in March may seem as though the floodgates were opened, but the number is nowhere near the levels reported during the recession."
Although foreclosure petitions are up in the Worcester area from last year, the amount of foreclosure deeds fell from 229 last March to 194 this March. A foreclosure petition is one of the first steps in the foreclosure process whereas a deed is toward the end.
A Local Expert
Joanne Generelli is one of the many real estate agents that deals in the foreclosure market. Being in business for over 35 years in Worcester County, she has certainly seen her fair share of foreclosure properties.
While listening to the data presented by The Warren Group, Generelli remains unconvinced that there will be an increase in foreclosures in the near future because while the number of foreclosure petitions has seen a dramatic increase, the deeds have been decreasing.
“If there is some sort of an increase, I haven’t seen it,” said Generelli. “Foreclosures are quite a bit of my market; not all of it, but certainly a portion of it. Foreclosure deeds have been decreasing. I would say that there has been a slow down in the foreclosure market.”
The foreclosure market is also something that has began to change more recently. According to Generelli, a market that was once dominated by quick fix jobs has changed to something a little more lasting.
“I think that the days of the easy flops in the foreclosure market have come to an end,” said Generelli. “The market used to be dominated by these types of foreclosed homes.”
Generelli insists that the foreclosure market is not gearing up for another increase. On the contrary, she says that she believes that the slight downward trend will continue for months to come. After all, the market is in better shape than it was when the recession hit.
More Than Just a Salesperson
As it turns out, a lot of real estate agents are not concerned with the spike in foreclosure petitions. Although an early indicator of a potential foreclosure, the petition does not indicate that a foreclosure will happen.
Erika Hall, a real estate agent who works with Keller Williams, has a hard time explaining the increase in foreclosure petitions but the decrease in foreclosure deeds. Although not able to make any sort of definitive claim, she is more than willing to speculate.
“The overall point is that there is always an ebb and a flow within foreclosure shadow inventory,” said Hall. “I suspect that long-term unemployment may have a role in ongoing foreclosures. With that being said, real estate agents do offer a lot of help for people facing foreclosures.”
Hall is currently working with a client who is facing trouble in the real estate market. The client in question is facing a foreclosure but doesn’t apply for many of the assistance programs. While definitely different than what a typical person would expect a real estate agent to do, Hall says that it is all part of the job.
“I am currently working with a client who is facing a foreclosure,” said Hall. “The client in question is not eligible for a short sale. She also found out that her sewage system just recently failed. We are currently looking at what options would be best for the client in the future.”
Hall says that there are a lot of campaigns and initiatives on both local and statewide levels designed to help people keep their homes away from the foreclosure market. She highlights the program sponsored by the Attorney General’s Office – which offers short sale help – as a “tremendous” program.
“We see some houses that have been in mortgage default for more than 12 months,” said Hall. “Sometimes the banks even think that it is a safer alternative to keep them there. We are seeing more and more that people are living in homes months after they enter default.”
Single Family vs. Condos
In a separate press release, The Warren Group announced that single family home sales have seen another dip in sales, the fourth time such occurrence has happened in the past five months. While single family homes have seen a dip as of late, condominiums are continually rising, with both sales and prices increasing more than 10-percent from last year’s marks.
Eric Berman, the Communications Director at Massachusetts Association of Realtors, says that single family homes and condos are two areas that are constantly in flux because a lot of it has to do with needs verses the available market.
“The market is sort of a touch and go market,” said Berman. “It really has to do with the inventory available to buyers. We have certainly seen a trend in condo sales, but it is because that is what people are looking for right now.”
Berman says that condos are an attractive option to many who are looking to downsize, although the downsizing is typically in size and not in price. Many of the condos on the market are seen in bigger cities throughout the state, with Worcester being included.
“Condos are certainly a unique market,” said Berman. “We are seeing a lot of high end condos in larger cities like Boston and Worcester coming into the market. Condos used to be a cheaper alternative to a single family home, but they are no longer seen as a rung on the ladder anymore. They are becoming more desirable and unique; all cities and towns have single family homes, but not all cities and towns have condos.”
And while a condo has certainly become an attractive option for buyers as of late, the housing option also can face a threat of foreclosure. After all, anything with a mortgage can see a foreclosure if the bills are not paid.
“Foreclosure can always be a threat is someone takes out a mortgage,” said Berman. “If you can’t pay the bill then it doesn’t matter what type of home is it. A condo can be foreclosed on just as easily as a single family home.”
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