Reasons for optimism in real estate

Today's Lowell Sun has a front-page article about the direction of real estate. Several people interviewed (including me) see signs of a recovery while others were more pessimistic. My optimism is based on two trends I have watched since October: the number of mortgages being recorded is up from a year ago and the number of foreclosure-related documents is down. I see both of these as leading indicators of a real estate bounce-back.

Taken as a whole, 2010 was a pretty dismal year, seemingly much worse than 2009. But if you just look at the Fourth Quarters of the two years, 2010 was much better. To get the most up-to-date numbers, I compared the number of mortgages, foreclosure deeds and orders of notice recorded in the Middlesex North District from October 1, 2010 to February 24, 2011 (yesterday) with those recorded in the same period a year ago. Here's what I found:

Mortgage recordings were up 38% (6536 v 4744)
Foreclosure deeds were down 50% (218 v 109)
Orders of Notice were down 57% (602 v 246)

The significance of the drop in foreclosures is self-evident, but mortgages are important because in 2003, a dramatic rise in mortgage recordings signaled the beginning of the real estate boom. While we don't want to revert to the chaos of that period, we would welcome a rebound in home prices, something that very well might follow behind this uptick in mortgages.

National Home Sales up slightly

Yesterday's New York Times reported that national home sales were up slightly from December, and that one-third of the sales were of foreclosed properties and that one-third were cash only deals (which is indicative of investors being active). Here in the Middlesex North District, the number of deeds recorded in January 2011 was up 13% from the number from January 2010 (384 v 339) while the median amount of consideration stated on those deeds was up 16%, from $217,900 to $252,250.

Apple Introducing iPad 2 on March 2

On March 2 Apple will introduce the "iPad 2" to the world. Interestingly enough, some techie sites are jokingly calling the new device the "iPad too". LOL, I guess.

But here is the serious question...Is there really any major difference between the first iPad and iPad 2(or too)?

Reports say yes...

To begin with iPad 2 is lighter and more powerful and has a front-facing camera. The front-facing camera is used for video calling or what Apple calls face-time (I never use face-time. It makes my head look too big).

Apple will unveil the new iPad in San Francisco at an invitation only event. And, yes the invitations are in the mail (no, I haven't got one yet).

Here is what the cover of the invite looks like. I love it. It is so appleish...

Obama Dines with the Tech World

Last Thursday President Obama met with some really big, big-wigs in the technology industry...I am talking game changers. Here is list of some of guests:

Apple's Steve Jobs
Facebook founder Mark Zuckerberg
Oracle CEO Larry Ellison
Google honcho Eric Schmidt.
Carol Bartz, president and chief executive officer, Yahoo
Dick Costolo, C.E.O, Twitter
Reed Hastings, C.E.O., Netflix



Check out this picture...I think that's Steve Jobs sitting on the presidents left and Mark Zuckerberg on his right.



These giants of the computer world all dined with the President in a sort of techie summit.

But one of the most interesting "facts" about the meeting is the lack of "facts" that have been released about it.




Even this picture of the arrival of Obama's motorcade projects the meeting's secrecy.



And I'm disappointed...There is so much I want to know.

Update on Judicial Center

Last night at a forum sponsored by the local non-partisan political action committee Move Lowell Forward, Lowell's Assistant City Manager for Planning and Development Adam Baacke spoke for 90 minutes about various development projects underway within the city. One project relevant to the registry of deeds is the new judicial center which is to be built in the city's Hamilton Canal District.

Already underway is site remediation. Formerly the home of a gas station, a substantial amount of petroleum contaminants the were in the ground had to be removed. Most of this has been done. The second phase which will begin shortly is the relocation of a number of utilities such as water and sewer pipes that pass through the site.

More distant is construction of the building. The plan is to begin work in 2013 with the building opening in 2015. There is some ambiguity about this schedule, however, because the state's division of Administration and Finance has not yet released full bonding authority to the Division of Capital Asset Management, the agency that owns (and constructs) all state buildings. DCAM cannot begin design of the building until the money for the project is all in place so this is a potential trouble spot. Adam emphasized that the city's legislative delegation is on top of this issue and it's one of their top priorities.

Mid-month statistics for February

The second month of 2011 is more than half gone, so let's take a look at the first two weeks of February recording stats compared to the same time next year. From February 1st through the 16th, there were 171 deeds recorded in 2010 and 154 recorded in 2011, a drop of 10%. In 2010 there were 414 mortgages, in 2011 there were 473 mortgages, an increase of 14%. In 2010 there were 28 foreclosure deeds, in 2011 there were 14, a decrease of 50%. In 2010, there were 80 orders of notice, in 2011 there were 25, a decrease of 69%.

Overall, these statistics are good news, especially when the difficult weather of the past two weeks is factored in. While the decrease in deeds being recorded is a negative, all other signs are positive, especially the significant drop in the number of foreclosure-related filings.

Take on Watson

Do you like Jeopardy? Well, here is your chance to play the ultimate game.

On Monday I wrote about the three day battle between an IBM super-computer named Watson against two former Jeopardy champions. Well, after two nights of "Man Vs Machine"...machine is winning, big time.

Here's where they stand...
Brad Rutters (Human) $10,400
Ken Jennings (Human too) $4,800
Watson (Machine) $35,734

Yes, Watson is cruising along after two nights of competition earning three times the winnings as Jennings and Rutters...but you've got to give Jennings and Rutters credit...its not easy battling a machine with 21.6 terabytes of memory...

OK, so you think you'd like to take on Watson...well, here's your chance courtesy of the New York Times...click on the picture below to begin your game of Jeopardy against Watson.

How many orders of notice result in foreclosure deeds?

Two documents form the bookends of every foreclosure: the Order of Notice which comes at the beginning and the Foreclosure Deed which comes at the end. But every Order of Notice does not necessarily result in a Foreclosure Deed. A borrower who is the recipient of an Order of Notice might avoid foreclosure by (1) negotiating a modification of the mortgage with the lender; (2) obtaining sufficient funds from other sources to bring the mortgage current; (3) refinancing the mortgage; (4) selling the property; (5) conveying the property to the lender with a deed in lieu of foreclosure; or (6) some other option.

To try to determine what percentage of Orders of Notice ripen into Foreclosure Deeds, I generated a list of all Orders of Notice recorded for property in Lowell from July 1, 2006 to June 30, 2010 and then a list of all Foreclosure Deeds recorded for property in Lowell from January 1, 2007 to December 31, 2010. The six month offset was to account for the approximately six month gap between the recording of the Order of Notice and of the Foreclosure Deed for the same property that is shown in Figure 8 above. The two lists were then combined and sorted by address and date. Every Order of Notice on that list was then categorized as (1) having a corresponding foreclosure deed; (2) having no corresponding foreclosure deed; and (3) being a duplicate of another Order of Notice.

There were a total of 2053 Orders of Notice on the list and only 1305 Foreclosure Deeds. The number of Orders of Notice that matched Foreclosure Deeds was 1284 (63%); the number that had no corresponding Foreclosure Deeds was 645 (31%); and the number of Orders of Notice that were duplicates was 124 (6%). So fewer only two out of every three Orders of Notice result in a foreclosure.

What is Man vs Machine?

Tonight is the night...
What is February 14?, Alex

Tonight the battle begins to answer the big question.
What is "can a computer out smart a human"?, Alex

Tonight Jeopardy champions Ken Jennings and Brad Rutter face off against an IBM Supercomputer.
What is Watson?, Alex

IBM developed Watson rating the game show as "the ultimate example of displaying knowledge that requires more than just a basic formula or playbook".
What is Jeopardy?, Alex

And this will be a marathon of a contest. Jennings, Rutter and Watson will battle each other for three consecutive nights. Unlike most Jeopardy events the scores of these contestants will roll from show to show.
What is the format?, Alex

IBM was so eager for Watson to compete, it built an entire Jeopardy set at one of its corporate headquarters and brought Alex Trebek and company to Watson.
Where is upper-state New York?, Alex

The battle should make great TV viewing and as contestant Ken Jenning said..."This time, I'm not just playing to pay my mortgage or something, or to feed my kid's college fund, I'm actually sort of representing 7 billion human beings against our new machine tyrants".
What is exaggeration?, Alex

The Daily

Last week Rupert Murdoch's News Corp released its much anticipated all digital newspaper called The Daily. Murdoch brags that The Daily features "stunning photography, 360 degree photos and HD video". The media giant spent close to $30 million to develop his digital newspaper but the cost to "distribute" the periodical is negligible. The media world is closely watching the public's reaction to The Daily.

Is it The Daily the future of journalism? Time will tell.

Preparing for the new Homestead Law

The new Homestead law goes into effect next month - March 16, I believe. An agent for Old Republic National Title Insurance showed me a bulletin the title insurer prepared regarding the new law. Hoping Old Republic will forgive me for appropriating its work, here's the content of the bulletin:

In 1980, the Supreme Judicial Court issued its opinion in Atlantic Savings Bank v. Metropolitan Bank and Trust Co., 9 Mass.App.Ct.286, 400 N.E.2d 1290, (1980), which for conveyancers, was a seminal case in the law of Homesteads in Massachusetts. The Atlantic Court held that a mortgage executed by a homeowner and his spouse was superior to a prior-recorded Declaration of Homestead. Atlantic Savings Bank at 1291. Unfortunately, the case left many other questions unanswered and those issues have been the basis of a great deal of debate and uncertainty in the intervening period. With the passage of the new Homestead Law (2010 Mass. Acts Chapter 395), the legislature has rewritten M.G.L. c. 188 and answered those questions giving conveyancers a clear protocol that had been lacking until now. Effective March 16, 2011, the statute not only codifies the holding in Atlantic Savings Bank, it expands the scope of homesteads generally and does away with some of the prior law’s more anachronistic provisions.

What follows is a brief overview of some of the new provisions of chapter 188 with a view toward alerting our agents to those provisions of the statute which most impact conveyancing practice. Section numbers are references to the new sections. As always, agents are encouraged to review the statute and contact the Underwriting Department with any questions or concerns.

Automatic Subordination of Prior Homestead (Section 9): As mentioned above, the new statute codifies the holding in Atlantic Savings Bank. Specifically, section 9 provides that a when a mortgage is signed by all the owners of the property, a prior-recorded Declaration of Homestead will automatically be subordinate to that mortgage. However, the statute changes prior practice in that it no longer requires a non-titled spouse to sign the mortgage in order to subordinate the homestead to the new mortgage. Further, the mortgage no longer needs to contain subordination language which was a prerequisite to subordination for the SJC in Atlantic Savings Bank. Finally, section 9 prohibits a lender from requiring a release of Homestead prior to recording a mortgage.

Automatic Homestead (Section 4): The statute now provides for an automatic homestead without any action required of the owner. The automatic homestead under section four provides for $125,000.00 protection for the owner and her family. It should be noted, however, that while this is an improvement upon the old statute where no coverage was provided on an automatic basis, the protection provided is still significantly less than the $500,000 protection provided under the declared homestead option under section five.

Declared Homestead (Section 5): The new statute provides $500,000.00 protection on the recording of a written Declaration of Homestead. Section 5 provides several requirements for the form of declaration to be recorded, notable among these:

1. Non-title spouse must be identified (§ 5(a)(1)). This is a codification of prior practice and the dictates of Atlantic Savings Bank.

2. The homestead declaration cannot be made in a deed (§ 5(c)).

3. Homesteads may now be declared where the home is owned by a trust, and it is anticipated that the trustees would execute the declaration (§ 5(a)(1)). Further, the beneficiaries of the trust should be identified in the declaration (§ 5(a)(1)) and § 1).

4. If the homestead is declared while the owner is single, and the owner is subsequently married, the homestead shall accrue to the benefit of the new spouse, and that benefit shall accrue as of the date of the original filing (§ 5(d)).

Termination (Section 10): Agents will recall many situations where certain inter-family transfers resulted in a homestead’s inadvertent termination creating in some cases an undue hardship in contravention of the purposes of the statute. The new statute provides very clear parameters for termination and, as importantly, to prevent inadvertent termination. Under this section, termination must be evidenced by an intent to terminate and be in very specific form:

1. Deed to a non-family member signed by the owner and the non-titled spouse;

2. Release signed by owner and non-owner spouse;

3. By abandonment of the home by the owner, owner’s spouse and family;

4. In the case of trusts, a deed or release signed by the trustee or by the release or abandonment by the beneficiary named in the declaration;

Significantly, section 10 provides a safety net for those transactions which are not meant to affect a termination. Consequently, the following conveyances will not affect the homestead:

1. Deeds between spouses or co-owners who individually or jointly hold a homestead;

2. Deeds between a trustee and beneficiary;

3. Deeds between a life tenant and a remainderman, unless in all of the above cases, there is an express release in the deed.

Further, section 10(d) provides that nothing contained in a mortgage will act to terminate a homestead.

Multiple Owners: In a departure from prior practice, the new statute anticipates that a homestead may be declared by multiple owners (§ 5(a) and § 3(a)). That is, each co-tenant, joint owner or tenant by the entirety may declare their own homestead.

Notice (Section 14): The statute requires that the closing attorney provide the mortgagor with a notice of the right to declare a homestead under c. 188. The notice should be signed by the mortgagor to acknowledge receipt and should include inter alia:

1. a summary of the differences between the automatic homestead protections and the declared homestead protections;

2. the enhanced benefits of the declared homestead protections.

Old Homesteads remain in effect under the new c. 188: Finally, the new statute provides that all homesteads currently in effect will remain in full force notwithstanding their failure to comply with provisions of the new statute.

Elevator Update

There has been much progress since the last time I took pictures of the elevator construction here at the Middlesex North Registry of Deeds...the elevator doors are in, a large part of the ramp is done, much of the finish trim has been installed and the support railings along the walls are in place.

Housing Bubbles

Robert Shiller, the co-founder of the S&P/Case-Shiller Home Price Index, wrote a column in the Sunday business section of the New York Times about housing bubbles. He says that while there have been many localized bubbles through the years, a nationwide real estate slump has been very rare and when they do occur, they are not repeated for decades. He says that bubbles are impossible without extreme public enthusiasm and that surveys that still show many Americans consider housing to be an "investment" are disturbing (a house is not an investment; it's a place to live that depreciates in value over time) and that such an attitude, if it strengthens, would create a hospitable environment for another bubble. Shiller does believe, however, that a very active Federal reserve plus some of the reforms created by the Dodd-Franks law will make the return of a housing bubble even less likely anytime soon.

Super Bowl XLV

Another Super Bowl is part of history. Before the start of the game I hoped for three things: (1)a Green Bay victory; (2) an exciting game; and (3) entertaining commercials. With the Packers beating Pittsburgh, 31-25 in a game in which the outcome was in doubt until the final moments, the first two were met. For the most part, I found the commercials very entertaining. My favorite was a commercial for the Chevy Cruze Eco that was set in a nursing home. Some were offended saying it poked fun at the elderly, but my attitude was we're all going to be elderly some day, so it really applied to everyone.

"Title to Murder"

The city of Lowell has been receiving a lot of attention recently as the setting for the Academy Award nominated film, "The Fighter" which is the story of Lowell boxer Micky Ward. Filmed in the city during the summer of 2009 - with two scenes done here at the Middlesex Superior Courthouse - the movie has already won Golden Globe and Screen Actors Guild awards and is up for several Oscars on February 27.

It turns out that the courthouse in Lowell is not the only venue to be used in movie production. A friend from Cambridge recently sent me a link to a 2001 movie called "Title to Murder" which was filmed at the Registry of Deeds in Cambridge.

Starring Maureen McCormick (Marcia from "The Brady Bunch") and Christopher Atkins (from "Blue Lagoon") and directed by Stephen Furst ("Flounder" from "Animal House"), "Title to Murder" is best described on the film's website:

Maureen McCormick is Leah Farrell, a bored and frustrated title examiner from Charlestown, Massachusetts but a routine title examination changes everything. An elderly woman has disappeared and when Leah goes snooping, she suddenly finds herself in line to be the next victim. District Attorney Paul Shaughnessy, played by Christopher Atkins has got to move fast if he's to prevent Leah from becoming the next murder victim.

I don't remember "Title to Murder" in the theaters, but it was recorded at the registry of deeds in Cambridge, which is quite evident from the trailer embedded on the film's website (which I can't embed here, so go to the website and watch it). But if you're interested in catching a film about title examiners, "Title to Murder" is available on Amazon.

Policy on weather-related closure of registry

I became Register of Deeds on January 5, 1995 and that next winter, the 1995-96 season, set the all-time record for the most snowfall ever recorded in this region. We didn't have a blog back then, so the documentation of our experiences in that winter 15 years ago is sketchy.

Our snow totals this year, while considerable, still have a ways to go to threaten that record. Still, we've had plenty of stormy days this winter, many of which have had an impact on our operations. The toughest situation to deal with is the overnight storm that continues into the start of the workday. Our policy right now of whether the registry will remain closed or have a delayed opening is dictated by the Trial Court, our landlord here in the Superior Courthouse. If the court is closed, then we are closed.

The best way to find out if the courthouse is closed is to visit the Trial Court website. Closures and delays are indicated by a notice that is placed on that site, usually by 6 am, on a stormy day. Such a notice was there yesterday. Another appeared back on January 27 - I captured a screen shot of that one.

One warning about the Trial Court website: if you've visited it before the notice goes up, your computer automatically stores a copy of the older version of the page. When you revisit that site, your computer will reload the earlier version of the page that was stored on your computer, the version that doesn't contain the weather-notice. You have to click on your browser's "Refresh" button to force your computer to reach out to the Trail Court server and load the latest version of that page.

If all that "refresh" stuff seems too complicated, you can also check here. As soon as I see an announcement on the Trial Court website, I post it here, just as I did at 6:11 a.m. yesterday morning.

Finally, if the snow is falling heavily during the day, there is always a chance the registry may close early. If you have a late-in-the-day recording to do and it's snowing, please call us at 978/322-9000 to ascertain our status.

Delayed opening today

The Middlesex North Registry of Deeds will not open until 11 am today due to the ongoing snow. Same goes for all courts in the following counties: Berkshire, Essex, Franklin, Hampden, Hampshire, Middlesex, Norfolk, Suffolk and Worcester.

Registry Closing Early Today

The Middlesex North Registry of Deeds will close today at 3:30 due to the ongoing snowstorm.

Tomorrow and for future beginning-of-the-day storms, check the Trial Court's website for any announcements about building closings. The Registry of Deeds follows the Trial Court's decision about closing or delaying the opening of the Superior Courthouse.

January statistics

The positive trends from the 4th quarter of 2010 continue into January 2011. In the October through December time period for 2010 when compared to the same period in 2009, the number of mortgages recorded was up 44% while the number of foreclosure deeds and orders of notice were down by the same percentage. Deeds were down by 8% which was the only statistic that was even slightly negative. The numbers for January 2011 are even better. When compared to the same month in 2010, this number of deeds recorded in this January was up 13%, mortgages up 38%, foreclosure deeds down 61%, and orders of notice down 84%.