We knew this was coming, didn’t we?
Petitions to foreclose on Massachusetts homeowners rose nearly 70 percent in 2006, and the number of distressed properties that went to auction increased 46 percent, a report said today.
The report is from The Warren Group of Boston, publisher of Banker & Tradesman and a provider of New England real estate data.
In Suffolk County, which includes Boston, petitions to foreclose jumped 79 percent in 2006, the report said.
Petitions to foreclose are the first step in the foreclosure process and do not always end in actual foreclosure.
In 2006, mortgage lenders filed 18,926 petitions to foreclose, compared with 11,155 in 2005, the Warren Group said; lenders announced 6,729 foreclosure auctions in 2006, versus 4,620 in 2005.
“As housing prices decline, people who had borrowed 90, 95, or even 100 percent of the value of their home now find themselves owing more than their homes are worth,” the group’s chief executive, Timothy Warren Jr., said in a statement.
(By Chris Reidy, Globe staff)
Housing prices, not just in Boston but anywhere within reasonable commuting distance, are in the stratosphere. A “starter” home that was selling for $35K 20 years ago is selling for ten times that much now if it’s within 45 minutes of downtown (not counting traffic condiditions of course – 45 mins at 3 in the morning). Stagnant wages + soaring housing costs = foreclosure and bankruptcy. Not a hard equation to understand.
And thanks to our late Republican Congress and Pub-enablers like Joe Biden, changes in the bankruptcy laws mean fewer – way fewer – current homeowners will be able to protect themselves against these foreclosures and will lose their homes.
Looks like banks will be going into the real estate business whether they want to or not.