Distress begins to be on wane in some urban areas
Foreclosure Monitor is an effort by MHP to helppublic officials determine how best to use their resources to help homeowners and neighborhoods hard-hit by foreclosure.
By Tim H. Davis, April 28, 2010
While the overall number of distressed units in Massachusetts has climbed from last year,foreclosures seem to be on the wane in some of the state's most troubled,dense, lower-income neighborhoods, according to MHP's latest analysis of distressed property data by community, neighborhood and zip code.
Using data fromThe Warren Group, MHP's analysis shows thatthe number of distressedunits are on the decline in cities like Lawrence and Brockton, andin the neighborhoods in these cities that have been hard-hit by foreclosure.
Meanwhile, there is continued evidence that foreclosures are spreading out away from urban areas into communities like Wareham and Templeton, as well as into the second home market on Cape Cod and the Islands. Also, foreclosures continue to be a problem in Worcester County, indicating that this area may be slow to recover.See the charts below for detail.
Each quarter,MHP uses data from The Warren Group totrack the total number of housing units affected by foreclosure. This includes units in properties where a foreclosure petition has been filed, an auction has been scheduled, or has been foreclosed and taken back by the bank (known as real estate owned or REO properties). Given the large number of multi-family properties in Massachusetts, it is important to measure the number of units, rather than the number of properties affected by foreclosure.
Statewide, from April 2009 to April 2010, the number of distressed units in Massachusetts increased from 33,453 to 38,724, a 16 percent increase. For every 1,000 units in Massachusetts, 15.3 were distressed as of April 1, 2010. While there was an increase from a year ago, there was a three percent decrease from January 1, 2010 to April 1, 2010. The number of distressed units depends on both new foreclosure activity and the rate at which lenders sell properties to new homeowners.
The below data reflects snapshots of distress in municipalities, zip codes, and census tracts across Massachusetts at the beginning of April 2009 and April 2010.
Foreclosures by community
Despite year-over-year decreases in Brockton and in Lawrence, these two cities remain the most distressed. The 15 percent improvement in Lawrence did place it second for the first time, pushing Brockton to the top of the list. This is good news for Lawrence, especially given its17.5 percent unemployment rate as ofMarch 2010.
Lynn and Fitchburg remained in the top five. A newcomer to the top 5 is Wareham, where the rate of distress has increased 38 percent from April 2009 to April 2010 in Wareham, moving it from 14th place to 5th place.
Large increases were found in the northern Worcester County towns of Ashburnham (107 percent) and Templeton (51 percent). The high level of distress in Worcester County is likely due to general economic distress.
Large increases were also seen in the Cape and Islands communities of Tisbury (165 percent), Oak Bluffs (69 percent) and Mashpee (62 percent).A portion of the foreclosures in Mashpee and Martha's Vineyard (which includes Tisbury and Oak Bluffs) are linked to second-homes. Of the distressed properties in Martha's Vineyard, 25 percent of the owners have non-local addresses.
This is not the entire story, as the poor economy has undermined year-round families, as unemployment in Tisbury jumped2.1 percentage points fromMarch 2009 toMarch 2010, to14.4 percent.
Eight of the top 20 cities and towns are located in Worcester County: Ashburnham, Athol, Fitchburg, Leicester, North Brookfield, Templeton, Winchendon and Worcester. Two each are located in Dukes County (Oak Bluffs and Tisbury), Essex County (Lawrence and Lynn), Plymouth County (Brockton and Wareham) and Suffolk County (Chelsea and Revere). One each are located in Barnstable County (Mashpee), Hampden County (Springfield), Middlesex County (Lowell) and Norfolk County (Randolph).
Carver, Haverhill and Marlborough fell from the top 20 from January to April. Boston falls well below the top 20, with a distressed rate of 16.3 units per thousand, a two percent decrease since April 2009.
Distressed Units by Zip Code
A break-down by zip codes clarifies foreclosure geography and allows for neighborhood analysis, particularly in Boston. Except for Wareham, Sandwich and Templeton, all of the top 20 zip codes in terms of distressed units are located in dense, urban areas.
As has been true for some time, Lawrence's 01841 remains the most distressed zip code in Massachusetts, despite an 18 percent decline in the number of distressed units from April 2009 to April 2010.
In addition to 01841, there were seven other zip codes in the top 20 that had a decline in the number of distressed units. Of these seven, three zip codes were in Boston (Dorchester and Mattapan), two were in Brockton, and one each in Springfield and Lynn.
This decline in the number of distressed units in lower-income, dense neighborhoods are hopeful signs that these markets have reached bottom. There were also hopeful signs in the fall of 2009 that were reversed over the winter of 2009/2010, so a declaration that the worse is over should wait for consistent improvements in these neighborhoods over the next two quarters.
The largest increases in the rate of distressed units from April 2009 to April 2010 were in Wareham's 02538 (67 percent), Sandwich's 02644 (47 percent) and Templeton's 01468 (41 percent), vaulting this Templeton zip code from 14th in April 2009 to 2nd most distressed in April 2010. This increase in Templeton combined with increases in Worcester and Fitchburg raise red flags that neighborhoods in Worcester County may be the last to recover.
Distressed units by census tract
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 a 1,000 to 3,000, providing a smaller area for analysis of foreclosure distress.
At the census tract level, Boston tracts in Dorchester and Roxbury occupy six of the top 20 tracts. While the number of distressed units declined in four of these six census tracts from April 2009 to April 2010, a 51 percent increase in 092000 and 40 percent in 091600, both in Dorchester, raises the possibility that while the hardest hit Boston tracts may be recovering, a second ring of tracts are suffering.
Five Brockton tracts are in the top 20 (unchanged from January 2010 and up from four in April 2009) and Springfield had four tracts in the top 20. In both cities, the results are mixed, with increases in some tracts and declines in others. Given the small areas of census tracts, this is indicative of relative stability in the foreclosure activity pattern.
In more promising news, there were only two Lawrence census tracts in the top 20 in April 2010, down from four in April 2009. Lynn also had two tracts in the top 20, with the remaining tract in Worcester.
Overall, 12 of the top 20 census tracts had a decline in the number of distressed units from April 2009 to April 2010.
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Foreclosures rippling into new neighborhoods
By Tim H. Davis, July 29, 2010
The Massachusetts foreclosure picture is presenting a classic good news, bad news scenario, as the rate of foreclosures in some of the hardest-hit urban neighborhoods are slowing, while nearby neighborhoods are beginning to see a spike, according to Foreclosure Monitor's regular quarterly analysis of foreclosure data from The Warren Group.
In analyzing the number of units affected by foreclosure by zip code, Foreclosure Monitor found that for the first time, Lawrence's 01841 has been knocked from its perch as Massachusetts' most distressed zip code. A 19 percent decline in the number of distressed units from July 2009 has moved this zip code to third place, behind Templeton's 01468 and Springfield's 01108.
In addition to 01841, there were seven other zip codes in the top 20 that had a decline in the number of distressed units. Of these seven, three zip codes were in Boston (Dorchester and Mattapan), two were in Lynn, and there was one each in Brockton and Springfield.
While this is good news for these neighborhoods, adjoining zip codes have not fared as well, as there was an eight percent increase in Brockton's 02302, a nine percent increase in Dorchester's 02122 and a 27 percent increase in Springfield's 01151. This is a sign that while the hardest hit zip codes may have hit bottom, a second tierofzip codesin these same cities are now under stress.
Foreclosure Monitor's zip code analysis also found that the largest increases in the rate of distressed units from July 2009 to July 2010 was in Templeton's 01468 (67 percent), vaulting this Templeton zip code from 13th in July 2009 to the most distressed in July 2010. Other significant increases could be found in Wareham's 02538 (62 percent) and Sandwich's 02644 (38 percent).
Foreclosure Monitor'sscope & sources
Foreclosure Monitor is able to provide thisanalysisthrough the CHAPA/Warren Group distressed property database,with support from the state Department of Housing and Community Development (DHCD).For other recent Foreclosure Monitor reports, click here.
Foreclosure Monitor's quarterly analysis includes properties where a foreclosure petition has been filed, an auction has been scheduled, or when a property has been foreclosed and taken back by the bank (these are known as "REO" or "real estate owned" properties).
Given the large number of multi-family properties in Massachusetts, Foreclosure Monitor's analysis tracks the number of units impacted by foreclosure rather than the number of properties affected by foreclosure. This report reflects snapshots of distress in municipalities, zip codes, and census tracts across Massachusetts at the beginning of July 2009 and July 2010. Other highlights from our quarterly analysis include:
Municipalities: Easing up in urban areas, rising in Worcester County
From July 1, 2009 to July 1, 2010, the number of distressed units in Massachusetts increased from 32,374 to 37,759, a 16.6 percent increase. For every 1,000 units in Massachusetts, 14.94 were distressed as of July 1, 2010.
The number of distressed units depends on both new foreclosure activity and the rate at which lenders sell properties to new homeowners. Brockton and Lawrence remain the cities with the highest rate of distressed units, despite a decrease in the number of distressed units. Conditions have improved faster in Lawrence than in Brockton. A year ago, Lawrence ranked first in distress, with Brockton second. These two switched positions last quarter.
Lynn has also seen a decline in the number of distressed units (-7 percent), but remains in third place. Fitchburg and Chelsea round out the top five. A year ago, Fitchburg was ranked eighth, but a 16 percent increase in distress moved this northern Worcester County city to fourth place.
Large increases were also found in the Worcester County towns of Brookfield (157 percent), Ashburnham (126 percent) and Templeton (76 percent). While a small number of properties can account for large changes in these smaller communities, the level of distress across Worcester County should be a cause for concern as nine communities are in the top 20. The next most troubled county is Plymouth with three communities (Brockton, Carver and Wareham).
Of those cities and towns that fell out of the top 20 from a year ago, the most notable are Everett, with a nine percent decline in distress, and Marlborough, with a seven percent decline. Dighton, Haverhill and Leicester also fell out of the top 20.
Census tracts: Pinpointing urban trouble spots; good news for Lawrence
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 a 1,000 to 3,000, providing a smaller area for analysis of foreclosure distress. At the same time, due to the smaller number of housing units, a small increase in the number of distressed units can lead to a large increase in the rate of distress.
At the census tract level, Boston tracts in Dorchester and Roxbury occupy seven of the top 20 tracts (up from six the year before). Four Brockton tracts are in the top 20, up from three in July 2009. Lynn and Springfield both had three tracts in the top 20.
While the results were mixed in Brockton and Lynn (there were increases in some tracts and declines in others), all three Springfield census tracts in the top 20 experienced no change or an increase in the number of distressed units. The two Worcester tracts also saw increases in distressed units.
There is good news for Lawrence, where there is only one tract now in the top 20 (down from three in July 2009), and its rate of distress declined 21 percent from July 2009 to July 2010. Overall, eight of the top 20 census tracts had a decline in the number of distressed units from July 2009 to July 2010.
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Distress shift away from cities continues
By Tim H. Davis
BOSTON,Feb. 25, 2011--- The gradual shift in foreclosure activity away from urban areas into rural and suburban communities is continuing, according toForeclosure Monitor's latest analysis of distressed property data.
In the period from Oct. 2010 toDec. 31, 2010, Foreclosure Monitor found that the number of distressed units outside Massachusetts' 24 Gateway cities and Boston increased from 51 to 52 percent. This is the second straight quarter that Foreclosure Monitor has found higher rates of distress in suburban and rural areas than in urban areas.
A look at distressed properties by community also illustrates this shift from urban to suburban/rural shift, especially in Worcester County.For the first time since the April 2010 Foreclosure Monitor, Brockton has dropped from the top spot in our table of the municipalities with the most distressed units.
Ten of the top 20 communities are located in Worcester County. While a small number of properties can account for large changes in these smaller communities, the pattern of continued distress across Worcester County is a cause for concern that has been further explored recently by the Boston Globe.
Zip codes: Shows rural shift, urban hot spots
The trend away from urban areas is also reflected in the analysis of distressed properties by zip codes.Last year, 17 of the top 20 distressed zip codes were in urban areas. This year, the number has dropped to 12 (as of Jan. 1, 2011).
While the distess may be shifting, zip code analysis shows what urban neighborhoods need attention. In Boston, the overall citywide rate of distress is 10.6 units per thousand housing units, but two zip codes in the Boston's Dorchester neighborhood exceed 25 units/thousand (02122 and 02124).
Census tract analysis sheds light on urban areas; Springfield improves
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 a 1,000 to 3,000, providing a smaller area for analysis.
At the census tract level, all of the 20 most distressed census tracts are in dense, urban areas. Boston tracts in Dorchester and Roxbury occupy five of the top 20 tracts, including the most distressed census tract in the state, Roxbury's 090400.
