My New Blog

Foreclosures on the Rise

Recent data released by The Warren Group, a Boston publisher of real estate and financial information, shows residential property foreclosures have increased 199% when comparing the first 10 months of 2006 vs. the first 10 months of 2007. Many local towns have seen significant increases in foreclosures. What does all of this mean to the local homeowner? Typically when there is a dramatic foreclosure increase resulting in a large supply of Bank Owned properties listed for sale, area values tend to go down. Lets take the City of Lowell for an example. A majority of the 222 foreclosures in the City of Lowell are 2-3 unit Multi-Family properties. The 3rd Quarter (July-September) typically sees the most volume of sales activity for the entire year. In the 3rd Quarter 2006, there were 39 Multi-Family sales with a Median Sale Price of $315,000 & an average Days on Market of 87 in the City of Lowell. In the 3rd Quarter of 2007, there were 38 sales with a Median Sale Price of $232,825 & an average Days on Market of 121. While there is a similar volume of properties selling, Multi-Family properties are taking, on average, a month longer to sell & are selling for 26% less than they were a year ago. As you can see from this example, the large increase in Bank Owned inventory has had a direct affect on property values.

Don’t let the large increase in foreclosures or the negative stories from the media discourage you from the current real estate market. For many people, now is an excellent time to: buy their first home; upgrade to a larger home; move to a neighborhood with a better school system; or buy that vacation home. For more information on market conditions in your area, feel free to give me a call.