Mass August Foreclosures Lowest This Year

Monday, October 08, 2012

Adam Joseph Drici, GoLocalWorcester Contributor

Only 566 foreclosures were completed in Massachusetts during the month of August, the lowest recorded in 2012 and 40 percent fewer than in the same month last year, according to real estate publisher The Warren Group.

The new data found the third consecutive month of decreases in foreclosure deeds compared with 2011. August also marked the fewest number of completed foreclosures in a single month since 521 in February of last year.

“Fewer foreclosures were completed in recent months, which may indicate a greater effort from lenders to find loan alternatives,” said Cory Hopkins, editor of The Warren Group's Banker & Tradesman.

“As banks continue to return to more normal foreclosure procedures and the housing market follows the same path, we are likely to see more good news in coming months.”

A total of 5,975 foreclosure deeds have been filed so far this year, an 8.4 percent increase compared to 5,511 deeds recorded during the same period last year.

“Foreclosure starts are close to exceeding the total amount in all of 2011 – a seemingly bad sign,” Hopkins said.

“However, we’re comparing to a slow year when banks nearly halted their foreclosure proceedings. I don’t think this is cause for much alarm, but something to keep an eye on as foreclosures petitions are often a leading indicator of activity to come.”

Foreclosure petitions have increased every month so far this year, except for July. A total of 12,079 foreclosure petitions have been initiated so far this year, up 46 percent from 8,253 petitions filed during the same period in 2011.

Housing advocates have attributed much of the slowdown to increased regulation and safeguards following the national foreclosure settlement.

The Worcester City Council recently moved to have the City Solicitor prepare an ordinance "To Repair the Impact of the Foreclosure Crisis on the City of Worcester." The ordinance would be similar to anti-foreclosure legislation passed by the City of Springfield earlier this year, which would require banks to enter into mediation with distressed borrowers before moving on foreclosure or be hit with a $300-per-day fine and to put up a $10,000 bond to secure and maintain foreclosed properties.

Home Sales Continue To Rise

Meanwhile, Bay State home sales were up in August, with the 5,118 single-family homes sold in the Commonwealth, a 20 percent increase from the 4,262 sales recorded in August of last year.

“One more month of strong home sales confirm speculation that the housing market recovery is underway,” said The Warren Group CEO Timothy Warren Jr.

“Even though we are comparing to a slow August last year, the consistent sales volume of 4,000 to 5,000 in the past few months is a promising indicator.”

The state also posted strong home sale numbers the prior month, with the 4,979 single-family homes changing hands in July marking the highest sales volume for the month in seven years.

Home prices ticked up slightly in August to a median single-family price of $310,000 compared to $305,000 in 2011.

“In past housing market recoveries, we’ve seen sales volume increase before prices followed,” Warren said.

“Perhaps these low prices will lure even more buyers into the market and bring a sustained recovery.”

With the Federal Reserves recent action set to keep interest rates low well into 2014,