The grass in front of 3 Brierwood Court has grown long since its owners moved out and their lenders put it up for auction.
Located on a nice Bay View cul-de-sac with three bedrooms and a two-car garage, the house is one of a growing number of properties facing foreclosure on Cape Ann, a region that until recently had appeared insulated from the financial turmoil gripping the state and country.
But while homeowners in Gloucester have not suffered from the collapse of the housing bubble the way many communities in Essex County have for the last two years, foreclosures this year are rising and may be a sign of things to come
According to real estate industry analysts, The Warren Group, the number of Gloucester foreclosure deeds filed rose from 12 during the first nine months of 2007 to 23 this year. Announcements for foreclosure auctions in Gloucester rose from 19 during the first nine months of 2007 to 58 this year.
In Rockport, the situation is more stable, with foreclosure deeds flat over the first nine months from 2007 to 2008 and auction announcements up by only two, from nine to 11.
Over the same time frame, foreclosure deeds in Manchester jumped from two in 2007 to five this year, while the number of auctions dropped from six to one. Essex saw auction announcements rise from five to eight, but deeds were flat.
Statewide, foreclosures shot up by 72 percent in the first three-quarters of this year compared with the first three-quarters of last year. The numbers were the worst in urban areas, including Worcester, Boston, Springfield and Boston.
Warren Group CEO Timothy Warren said Friday that the foreclosure numbers in Gloucester, while rising, are still dwarfed by the problems in larger communities.
But the downturn in the housing market that began when lower-income borrowers who had taken out high interest sub-prime loans began to default, is now spreading further into the ranks of prime borrowers, he said.
"I don't think you would find that the foreclosure rate in Gloucester is dangerously high, but no community is immune," Warren said. "A lot of this has to do with job losses. I think we are seeing more prime loans getting into trouble."
The first step in the foreclosure process is the filing of petition in Land Court. Foreclosure petitions have dropped so far this year, a fact attributed in large measure to the "Right to Cure" law passed in April that requires lenders to give homeowners falling behind on their mortgages 90 days to cure their delinquency before filing for foreclosure.
To this point, large national mortgage lenders have suffered heavier losses from foreclosures than community banks, largely a result of the big lenders' willingness to offer variable rate loans to vulnerable borrowers.
That pattern has continued on Cape Ann, where many properties up for auction had mortgages held by national lenders.
In the case of 3 Brierwood Court, the mortgage was held by Option One, of Pasadena, Calif. That company has since been sold to American Home Mortgage, another sub-prime lender.
At Granite Savings Bank in Rockport, Pat Parody of the mortgage division said only two of the more than 200 mortgage holders the bank lends to had fallen behind on their payments to a point of concern.
"We are not really going to see it in the mortgages until the next couple of months," Parody said about the current economic slowdown. "I have been in contact with my peers in places like Beverly and, compared with them, we are golden."
Accompanying the rising foreclosures, home values and the number of sales in Gloucester, like the rest of the country, continue to slip.
According to the Warren Group, the median sales price of a single-family home in Gloucester dropped from $381,000 last year to $350,000 this year, the lowest mark since 2002. Median prices reached their high-water mark in 2005, at $440,000.
The number of sales have also continued to slide. The 264 sales of single-family homes and condominiums in the first three quarters of this year was the fewest since 1991, when 196 sold during the same nine months.
Parody said the drop in home sales on Cape Ann was apparent and more of the buyers who are active in the market are paying cash.
The Brierwood Court colonial is scheduled for auction tonight in Groveland.
Patrick Anderson can be reached at panderson@gloucestetimes.com
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