The Federal Reserve Bank of Boston has put together a fantastic interactive map of foreclosures and subprime loan information covering each city and town in the Commonwealth over the past two decades (thanks to the Boston.com real estate blog for the heads-up).

I transferred the data for Boston to a table, below.

Fascinating information.

Compare 2007 with 1991-1993. The foreclosure rate (loans going bad as a percentage of total housing units) is a lot less than then. We might not have seen the worst of the foreclosures, yet (although I think we have), but the rate last year was considerably less than during the worst of the 1991-1993 recession – 0.56% now versus 1.65% then. As much a result of a stronger market, perhaps, as it is due to more units of housing now versus then.

Also a big difference? The number of subprime loans written during the past couple of years. Compare the number of subprime loans to total new loans written; is there a direct correlation with the number of foreclosures, each year? You might think so, but the jury is still out. Many people who took out subprime loans during the past couple of years have been able to pay their obligations, on time. Many loans going into default (70%, by some accounts) are “prime” loans. (Subprime loans are defined for purposes of this study as “typically made at high interest rates to borrowers with low down payments, bad credit histories, and/or limited documentation of their income and assets”.)

What does this mean for the future? You tell me.

Also, make sure to click on the other tabs of the Fed report. Look at the “house-price index” now compared to 1997 and 1987. A sign of the resiliency of the Boston real estate market, or a hint of trouble on the horizon?

Year Subprime loans Mtgs originated Foreclosures Housing units
1990 9,696 361 103,803
1991 7,933 1,059 104,820
1992 11,179 1,752 104,852
1993 77 13,547 1,459 104,948
1994 149 11,071 1,144 105,077
1995 206 10,996 654 105,146
1996 328 13,752 532 105,532
1997 652 15,419 359 105,636
1998 1,274 23,554 219 106,105
1999 1,296 22,477 178 106,812
2000 1,187 17,782 74 107,845
2001 1,601 28,249 40 109,222
2002 1,952 37,468 42 110,581
2003 3,260 48,959 23 112,132
2004 3,957 39,276 114,441
2005 5,181 37,039 68 117,145
2006 4,793 31,665 274 120,046
2007 1,230 24,667 697 122,439

Comments

comments

Call Now