Foreclosures take toll on central areas

Foreclosures take toll on central areas

by J. Craig Anderson The Arizona Republic Mar. 21, 2010 12:00 AM

The Valley's foreclosure wave swept inward in 2009, moving from younger communities at its outer edge toward older, wealthier and more centrally located areas.

The hardest-hit community by far was in west-central Phoenix, where foreclosures in two ZIP codes, 85017 and 85019, accounted for at least 72 percent of all home-resale transactions - about 1,070 sales out of 1,315, according to the latest Valley home-values data from The Information Market. The previous year, foreclosures accounted for about 60 percent of the area's sales.

Housing-industry groups such as the National Association of Hispanic Real Estate Professionals say that unscrupulous lenders continued to push predatory, subprime loans in west-central Phoenix well into late 2007 - months after mortgage brokers in other areas had discontinued their use.

As a result, foreclosure activity began almost immediately afterward and hasn't slowed since.

The ZIP code with the highest percentage of foreclosure-related sales was 85034, in southeast Phoenix, where foreclosures made up 74 percent of activity. But the area's transactions in 2009 totaled just 27, too small a number to produce statistically significant results.

Foreclosure activity continued to plague many of the more remote communities that already had suffered in 2008. For instance, 47 percent of 2009's home-sales transactions in Queen Creek involved foreclosures, up from 34 percent the previous year, according to the data.

Areas of the Valley that had been relatively unaffected by foreclosures in 2008 got hit. In Paradise Valley, metro Phoenix's wealthiest ZIP code of 85253, sales involving foreclosed homes increased from 4 percent in 2008 to 22 percent the following year.