(Foreclosure Monitor is an effort by MHP to help public officials determine how best to use their resources to help homeowners and neighborhoods hard-hit by foreclosure).
By Tim. H. Davis
BOSTON, Nov. 16, 2012--- While Foreclosure Monitor's quarterly review shows a slowdown in distressed properties, there are still several pockets of concern in cities like Brockton and Springfield as well as certain communities on the South Shore and Worcester County.
Foreclosure Monitor's review of distressed data through Oct. 1, 2012 found that there was a 0.6 percent decrease in distress from July 1, 2012 to Oct. 1, 2012. There was also a year-over-year decrease of 5.8 percent in distress since Oct. 1, 2011.
Since 2008, MHP's Foreclosure Monitor has been following trends in distress by community, zip code and census tract. A distressed property is defined as units in 1-3 family properties (including condominiums) where a foreclosure petition has been filed or an auction scheduled in the previous year, or has been bank owned, for up to two years.
This decline in distress is in line with the long term, slow decline in mortgage distress and foreclosure activity discussed in the last Foreclosure Monitor. High levels of distress continue to plague a number of communities in Central Massachusetts and on the South Shore. The census tract report below also shows that urban neighborhoods - especially in Brockton and Springfield - continue to struggle with high concentrations of distress.
Communities: Most in top 30 located in Central Massachusetts and South Shore
Of the top 30 most distressed communities in Massachusetts,12 had a decline in distress from Oct. 1, 2011 to Oct. 1, 2012. Distress was unchanged in two communities (Holland and Paxton) and increased in the remaining 16 communities.
The 16 communities in this list with an increase in distress are concentrated in Central Massachusetts and the South Shore, and are largely smaller communities; only Attleboro and Lowell have more than 10,000 housing units. Distress increased the most (59 percent) in the Worcester County town of Oxford. The list of communities in the top 30 with a decline in distress include some of Massachusetts' larger communities, including Worcester (-14 percent), Springfield (-5 percent), New Bedford (-2 percent), Lynn (-10 percent), and Brockton (-8 percent).
Even with a decline in distress, Brockton continues to have the highest level of distress among Massachusetts communities.
Back in Oct. 2010, the Foreclosure Monitor reported that for the first time, suburban/rural communities had a higher rate of distress than the urban Gateway cities and Boston (50.6 to 49.4 percent). This gap has widened slowly over most of the last two years, though it remained steady between July 1, 2012 and Oct. 1, 2012. As of Oct. 1, 53.8 percent of distressed properties were outside of Boston and the Gateway cities. This shift is due in large part to the fact that distress has declined faster over the last year in Boston (-17 percent) and the Gateway Communities (-8 percent) than in the remainder of the state (-3 percent). Other highlights from our latest community analysis include:
The largest decline in distress was in Plympton (-32 percent).
The number of Worcester County communities in the top 30 declined from 13 in October 2011 to 11 in October 2012.
The number of Plymouth County communities increased from five to seven over the same period.
Boston ranked 171st of the 292 municipalities ranked in its rate of distress, but had the highest number of distressed units (2,093) due to its sheer size.
Springfield had the second-highest number of distressed units (1,393) in the state, followed by Worcester (1,280 units) and Brockton (988 units).
Zip codes: Most distressed continue to show improvement
Seventeen of the top 30 most distressed zip codes had a decline in distress from Oct. 1, 2011 to Oct. 1, 2012, led by Springfield's 01151 (-27 percent). The remaining 13 zip codes had an increase in distress. The largest increase (38 percent) was in the small Plymouth County zip code of 02538 (Wareham). Substantial increases in distress were also seen in East Bridgewater's 02333 (35 percent) and Whitman's 02382 (30 percent), both of which are also in Plymouth County.
Brockton's 02302 continues to be the most distressed zip code in Massachusetts, as it was last quarter as well as one year ago.
Worcester County continues to have the highest number of zip codes in the top 30, with eight (down from 10 one year ago). Four of these zip codes are in Worcester; the remaining four are in northern Worcester County. A year ago, Hampden County had the second highest number of zip codes in the top 30 (six). The number of zip codes in Hampden County is unchanged from a year ago, and all of these zip codes are in Springfield. With an increase from three zip codes to seven, Plymouth County now has the second highest number of zip codes among the 30 most distressed zip codes. Boston has two zip codes in the top 30: 02126 (Mattapan) and 02136 (Hyde Park).
Census tracts: More than half of top 30 most distressed tracts are in Springfield and Brockton
While the number of housing units in a zip code can range from dozens to more than 20,000, the number of units in a census tract generally ranges from 1,000 to 3,000, providing a smaller area of analysis that shows us where the high levels of distress are in urban neighborhoods.
As of Oct. 1, 2012, the 30 most distressed census tracts were located in eight municipalities, down from nine municipalities in Oct. 1, 2011. In the last Foreclosure Monitor, Springfield had the highest number of census tracts in the top 30 (eight), but as of Oct. 1, Brockton had the highest number of tracts on this list (10), including the most distressed census tract (5114). Of these 10 distressed Brockton tracts, seven had a decline in distress since a year and three had an increase. Overall, Brockton's level of distress has improved relative to the state.
In Springfield, where overall distress is declining more slowly than the state as a whole, the number of census tracts in the top 30 increased from six a year ago to seven in Oct. 1, 2012. Of these tracts, four had an increase in distress and three had a decline in distress.
Boston, Lynn and New Bedford each had three tracts in the top 30. Of the Boston tracts, one tract each could be found in the neighborhoods of Dorchester, Mattapan, and Roxbury. Worcester had two tracts (down from five tracts last year), and Lawrence and Attleboro each had one tract. Lowell, which had one tract in Oct. 2011, had no tracts in the top 30 in 2012.
The biggest increase in distress was in Brockton's tract 5114, where distress increased 62 percent since a year ago, bringing this tract from 67th to 1st. The biggest decline in distress was in Worcester's tract 7324 (-28 percent), which was the most distressed tract a year ago.
For more information
The following links are provided for readers to directly access regular sources of foreclosure and real estate trends, some of which are mentioned in the proceeding analysis:
Foreclosure data: The Warren Group most recently released foreclosure data for the month of Sept. 2012. The number of foreclosure deeds filed in Sept. 2012 (510) was 32 percent lower than the 754 filed in Sept. 2011. This marks the fourth month in a row of year-over-year declines in foreclosure deeds. The number of foreclosure petitions (the first step in the legal process to complete a foreclosure) increased 22 percent from Sept. 2011 to Sept. 2012. Nationally, foreclosure activity (as reported by RealtyTrac) declined 16 percent from Sept. 2011 to Sept. 2012.
Real estate sales data: The Warren Group and the Massachusetts Association of Realtors (MAR) recently released their monthly real estate sales figures. The two use somewhat different data sets for analysis. The Warren Group reported an eight percent increase in the number of single family sales from Sept. 2011 to Sept. 2012, but a 4.5 percent decline in median single family sales prices, while the Mass. Association of Realtors reported a 2.8 percent increase in single family sales and a 0.6 percent decline in median single family sales prices.
The S&P/Case-Shiller Price Index recently released its Aug. 2012 data. In a reversal from the pattern seen in late spring, prices increased 2 percent nationally, from Aug. 2011 to Aug. 2012. Prices increased 1.7 percent in Greater Boston over the same period. Of the 20 cities measured, 17 cities had a price increase, and 14 of these cities saw greater price increases than in Boston. The biggest annual price increases were in Phoenix (18.8 percent) and Detroit (7.6 percent). The largest annual price declines were in Atlanta (-6.1 percent) and New York (-2.3 percent). Boston prices are currently 3.3 percent higher than the market low of April 2009, and remain 14.7 percent below the market peak of Nov. 2005.