Report: More Than 100 Homes Foreclosed Upon in East Providence

More than 100 single-family homes were foreclosed upon in East Providence over the past two years, according to a new report released today.

The report, issued by HousingWorksRI, indicates that East Providence ranks 16th in the state for foreclosures on mortgaged homes between January 2009 and December 2010. HousingWorksRI, which consists of nearly 140 organizations working on quality, affordable housing, compiled its analysis using data from The Warren Group and the Mortgage Bankers Association's National Delinquency Survey.

Of the homes foreclosed upon in East Providence during that period, 104 were single-family homes, three were condominiums and 17 were multifamily homes. Its 124 foreclosures represent 1.46 percent of the city's 8,485 mortgaged homes. Providence, Warwick, Cranston and Pawtucketwere among the most impacted by the foreclosure crisis, but according to HousingWorksRI executive director Nellie Gorbea, the report indicates that the state's other communities were not sheltered from the storm.

"I think what we found is that there's no community in the state immune to the impact of foreclosures," Gorbea said. "While people think of this as an urban problem, really it's a statewide problem."

According to the report, Rhode Island continues to rank as the state with the highest rate of foreclosures in New England, with over 13,300 mortgages either in the foreclosure process or more than 90 days delinquent during the fourth quarter of 2010. That's 20 percent higher than Massachusetts, 17 percent higher than Connecticut, 34 percent more than New Hampshire, 7 percent higher than Maine and almost double Vermont's rate. The 124 foreclosures in East Providence reflect how many homes were completely foreclosed upon in the town, categorized in the report as "actual foreclosures." The number does not paint the full picture of how many properties entered the foreclosure process, but did not end up at auction.

While the actual foreclosure rate in Rhode Island has started to drop, Gorbea said the fairly consistent number of homes entering the foreclosure process indicates that the problem still persists.

"I don't think we're out of the woods yet, really," she said.

While East Providence's 1.46 percent foreclosure rate may seem low, Gorbea said the impact on a community partly depends on how concentrated those foreclosures are.

"One of the problems that foreclosures bring about is their impact on surrounding properties," she said. "If you have more than just an isolated foreclosure in a neighborhood, it brings a different feel to that neighborhood. Even in terms of percentages, if you look at some of the cities, Cranston has a 2.13 percent rate. That doesn't sound like a lot, but when you drive down those streets where the foreclosures are concentrated, what does it do in terms of a neighborhood?"

The impact of foreclosures is multifold, but on the local level, Gorbea said they can really have an impact on neighboring property values and on municipal revenue. The report estimates that the average decline in value for the 331,175 homes in Rhode Island will be $13,745 through 2012, for a loss of $5.624 billion in lost home value statewide. The report states that foreclosures erode the local tax base while increasing expenditures due to the need for additional services.

Rather than trying to solve the crisis community-by-community, Gorbea said the solutions are really "statewide."

"Rather than get people worked up on finding out if there's a foreclosure on my street, what we're hoping to do is think more broadly," she stressed. "The issue is affecting the state's economy ... We looked a lot at the origins of the foreclosure crisis, and it's definitely tied to a lack of affordable housing. As a state we need to look at investing in affordable housing as part of the economic strategy in our state. ... Unfortunately some people think foreclosures on the market means that we're solving the affordable housing issue, but what we've tried to show (in the report) is that foreclosure does not mean more affordable housing."

For those looking to get involved, Gorbea encouraged residents to reach out to local community development corporations, like the East Bay Community Development Corporation or the Church Community Housing Corporation, serving Newport County. Those interested can also consider getting involved with community Affordable Housing Committees, which are required in cities and towns that haven't met the state's requirement of having at least 10 percent affordable housing, Gorbea said.

For more on the report, visit housingworksri.org.