Foreclosures Are on the Rise in These 10 U.S. Cities
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Foreclosure activity is climbing again this year after more than a decade of consistent year-over-year declines in homeowners having their properties seized for failure to pay.
A new report from real estate listings site Realtor.com found that while national foreclosure filings are still historically low, several individual cities have seen a rise in foreclosure filings lately. Analysts compared June data from property data company ATTOM with numbers from May and June 2022, ranking metropolitan areas by current foreclosure rate.
What the data says
- Nationwide, about 2.5 out of every 10,000 homes had a distressed property or foreclosure filing in June, according to ATTOM's analysis. A distressed property filing means a home is in danger of foreclosure, while a foreclosure is the repossession and sale of a home by a lender to recoup a mortgage balance when a borrower fails to pay.
- The number of homes with foreclosure filings in the first half of 2023 was slightly less than 186,000. ATTOM data shows Illinois, New Jersey and Maryland posted the most foreclosures.
- The pandemic led to the lowest number of foreclosures in more than two decades as a result of measures intended to keep people in their homes. Now that these measures have expired, foreclosure numbers are once again climbing.
- This year's numbers also pale in comparison to the 2010 peak of the housing crisis, when there were over 1.6 million homes with foreclosure filings. Realtor.com says 15 times as many mortgage borrowers were dealing with foreclosure around that time.
Should homeowners be worried about foreclosures?
Homeowners shouldn’t panic about a repeat of the 2008 housing crisis anytime soon, Realtor.com says. Most homeowners were protected from foreclosure from March 2020 to May 2021, so the uptick in filings is expected as lenders catch up to borrowers who fell behind on their bills.
Rising property taxes are another factor driving foreclosures. Home values across the U.S. have increased dramatically over the past few years. That's a good thing for homeowners, but some can’t afford their new tax bills, especially with inflation’s impact on other household expenses.
“As property values have exploded in some areas, property taxes have as well,” Hannah Jones, an economic research analyst at Realtor.com, said in a news release. “It can make these homes unaffordable even if the owner has a low mortgage rate.”
10 cities with the biggest increase in foreclosures
Foreclosure rates in June were highest in a handful of mid-sized cities in the Southeast and Northeast, with Atlantic City, New Jersey, leading the pack.
These are the metropolitan areas that saw the biggest increase in foreclosure filings per 10,000 housing units in June:
- Atlantic City, New Jersey
Median list price: $392,450
June foreclosure filings per 10,000 units of housing: 6.8 - Florence, South Carolina
Median list price: $273,950
June foreclosure filings per 10,000 units of housing: 6 - New Haven, Connecticut
Median list price: $424,850
June foreclosure filings per 10,000 units of housing: 5.6 - Baltimore, Maryland
Median list price: $365,875
June foreclosure filings per 10,000 units of housing: 5.5 - Mobile, Alabama
Median list price: $263,250
June foreclosure filings per 10,000 units of housing: 5.3 - Orlando, Florida
Median list price: $459,450
June foreclosure filings per 10,000 units of housing: 5.1 - Macon, Georgia
Median list price: $259,250
June foreclosure filings per 10,000 units of housing: 4.8 - Philadelphia, Pennsylvania
Median list price: $354,950
June foreclosure filings per 10,000 units of housing: 4.8 - Peoria, Illinois
Median list price: $169,675
June foreclosure filings per 10,000 units of housing: 4.5 - Modesto, California
Median list price: $532,438
June foreclosure filings per 10,000 units of housing: 4.3
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