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Home Foreclosures in Philadelphia Surged, but Prices Held Up

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By : John Cutts    99 or more times read
Home foreclosures in Philadelphia surged in 2009, but home prices held up, based on data from the Gloucester Salem Counties Board of Real Estate and Prudential Fox & Roach.

In Greater Philadelphia, a total of 31,020 households were notified of serious defaults or foreclosures in 2009, a jump of nearly 15 percent from distressed notices in 2008. One default notice out of every 77 households was filed by lenders in 2009.

Despite the surge in foreclosures, home prices did not fall sharply as in other metro areas. The foreclosure crisis did not batter Philadelphia as hard as it did to 112 other metro areas in 2009.

In Southeast Pennsylvania, the median price for homes rose to $215,000 in 2009, a total increase of 12 percent over the period from 2004 and the highest increase in the Greater Philadelphia region.

In Northern Delaware, the median price also rose to $210,000, a total increase of 17 percent over the period from 2004, but a 6.6-percent drop from the median in 2008. In South Jersey, the median price rose to $199,000, a total increase of almost 11 percent over the period from 2004. It however marked an 8.3-percent drop from the $217,000 median in 2008.

Pennsylvania home foreclosures also stepped up in 2009, posting a 20.2-percent jump from 2008 filings, but like its largest city, Philadelphia, its foreclosure situation was also much better than other states. It ranked 32nd among the 50 states in foreclosure activity.

Real estate professionals, however, say that owner-occupant buyers and investors who know how to purchase foreclosure properties can find attractively-priced home foreclosures in Philadelphia and in other parts of Pennsylvania.

Based on data from real estate firms, 32 percent of total house sales in Pennsylvania in 2009 were sold by banks and other types of home loan providers, a substantial increase from 28 percent in 2008.

According to Ryan Sweet, economist of Moody’s for the Philadelphia region, foreclosure sales cause further surges in foreclosure filings because homeowners cannot sell their houses in short sales to avoid foreclosures.

In many areas of Southeast Pennsylvania, homes stayed on the market for a longer time. In Cinnaminson, homes for sale stayed on the market for only about 45 days in 2004. Last year, they took 90 days on the average to sell.

Analysts, however, hope that home foreclosures in Philadelphia would take a shorter time to stay on the market in the first months of 2010 as buyers are expected to capitalize on current home price and mortgage levels before they rise.
John Cutts has been educated in the finer points of the foreclosure market over 5 years.

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