Project Mass

BOSTON (WBZ) ―









For most of us, owning a home is our biggest investment. It's part of the American dream and a symbol of success.

The good news, if there is any, is that the current real estate slump hasn't hit Massachusetts nearly as hard as some other parts of the country, such as Las Vegas and Miami. But there are still thousands of homeowners in distress

Kathy George is the familiar face of a market in crisis – familiar, in that her story is far too common. Kathy is losing her home.

"All my memories of my childhood are here," she told us.
"The Christmas tree would be right there. Coming down those stairs, peeking to see if Santa came yet. And he always did."

But Kathy's recent memories are of a different type of visitor: an auctioneer. With the bang of a gavel, her single-family home in Lynn was gone, faster than you can say "foreclosure." The price: $106,000.

Like so many Americans, Kathy and her sister needed cash. They borrowed about $30,000 against the equity in the home.

The payments were no problem until the home-health-care worker caught a staph infection on the job. Suddenly, she was four months behind in her payments.

The home, once paid off by her late parents, was in jeopardy.

"They must be rolling over in their graves," Kathy said, "seeing what's going on today and what's happening to my sister and I over what I thought was a simple loan."

And yet nothing is simple in real estate right now. Our homes, like new cars driving off the lot, are plummeting in value. Many homeowners are upside down, owing the bank more than the home is worth.

"It was just too easy and too cheap to buy a house," said Timothy Warren, chief executive officer of the Warren Group.

Warren tracks housing statistics, and says in two years the median price of a home in Massachusetts has dropped 10 percent. The number of homes sold has dropped by a whopping 26 percent in three years.

And the foreclosure numbers are frightening. In 2007, about 30,000 homeowners started the foreclosure process. That's up 55 percent.

"We are seeing it in every city," Lt. Gov. Timothy Murray said, "even in some of our more affluent towns."

As for Kathy George, the top bidder for her home has promised not to evict her - yet. But there are no promises.

And home is no longer a place to hang her hope.

"It's like a nightmare," she said. "Every day it's the first thing I think about. I get a knot in my stomach. I go to bed thinking about it."

It hasn't been this bad since the late 1980s and early 1990s. During that major housing slump, home prices fell about 15 percent over a five-year stretch. It then took another five years before prices got back to where they'd been before.

But then the market exploded. So it's all cyclical.

When will things turn around? That's the magic question -- and the answer depends on the expert.

A lot of real estate agents will tell you it's already turning around. But the folks who really study the numbers think it's possible the prices will finally flatten out this summer.

Of course, that's all speculation. 



Home Buyer's Toolkit, MA Assoc. of Realtors

Home Seller's Toolkit, MA Assoc. of Realtors

Preparing Your Home For Sale, MA Assoc. of Realtors





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