The drop in foreclosures nationwide in March should be good news for everyone, but the Boston business Journal's Jon Chesto notes GateHouse Media Inc. is facing a 6 percent decline in revenue year over year because of a decrease in ad sales for foreclosure auctions.
The loss of all those foreclosure auction ads that GateHouse once counted on to get through the tough times is continuing to hurt the company’s classified ad pages. Lower foreclosure revenue in Massachusetts accounted for a full 40 percent of GateHouse’s classified ad revenue decline in the first quarter, the company said. But there’s good news, GateHouse investors: CEO Mike Reed said he expects this problem to subside by the end of the third quarter, and “possibly reverse.”The Fairport, N.Y., company referred to the Massachusetts legislature in an SEC filing about first quarter results. Lawmakers there passed a law last year making loan modifications easier, implicitly leading to a further decrease in ad revenue. Declines in classified ad sales have plagued newspapers since the advent of the Internet. Next door in Rhode Island, the Providence Journal's owner A.H. Belo blamed the city's real estate market for the slow sale of some of the company's real estate.