Why is this important?

How are we doing?

Mortgage foreclosures represented less than 1% of all residential real estate sales from 2000 to 2005, down from 44% of residential real estate sales in 1992.  There were only 25 foreclosure sales in 2004 in Boston, compared to more than 1,000 per year from 1991 to 1994.  The housing bubble of the late 1980s was fueled by highly speculative mortgages.  After the savings and loan banking crisis of the 1990s, better lending practices were instituted, first-time homebuyers were better educated through increases in home-buying classes, and mortgage rates declined.  All of these factors, combined with a rapid increase in prices during 2000-2005, reduced foreclosures to a minimum. All of this changed with the softening real estate market of late 2005 and 2006. Foreclosures increased to 60 in 2005 and to 260 in 2006.  Once again, loose underwriting standards and fraud played a role, as sub-prime lending took off in the neighborhoods in 2004-2006.

In 2006, Roxbury, Dorchester, Mattapan and Hyde Park were hit hardest by foreclosures, and given that sub-prime lending has been much more prevalent in African-American and Latino neighborhoods, people of color are being hit much harder by the loss of their homes, their equity, and their neighborhood stability.