Homes in Foreclosure Process Jump 16.6% Year-on-Year
According to the third-quarter 2023 Vacant Property and Zombie Foreclosure Report from ATTOM, there are 315,425 residential properties in the process of foreclosure in the third quarter of this year, an increase of 1.3% from the second quarter of 2023 and a jump of 16.6% from the third quarter of 2022.1
About 8,800 of those pre-foreclosure properties are vacant as zombie foreclosures in the third quarter of 2023, up 0.3% from the prior quarter and up 13.9% from a year earlier. As the Coronavirus pandemic struck in early 2020, lenders were prohibited from pursuing delinquent homeowners. Those restrictions were lifted in mid-2021, putting a growing number of homeowners at risk of foreclosure.
“That’s to be expected, as a handful of homeowners who can’t catch up on overdue mortgage payments just walk away from their properties,” said Attom CEO Rob Barber.
While this is the sixth consecutive quarterly increase, zombie foreclosures still accounted for just a fraction of the nation’s 101.6 million residential property stock.
“Abandoned properties pose almost none of the blight threats they brought a decade ago when far more homeowners were throwing in the towel after the Great Recession of the late 2000s,” he said.
Overall Vacancies Show Little Change
Most neighborhoods around the U.S. have few or no zombie foreclosures. The vacancy rate for all residential properties in the U.S. has remained virtually the same for the fifth quarter in a row, at 1.26% or one in 79 properties, almost matching the 1.27% rate in the second quarter of 2023 and 1.28% in the third quarter of last year, or one in 78.
States with the largest vacancy rates for all residential properties are Oklahoma at 2.26% or one in 44; Kansas at 2.13% or one in 47; Alabama at 2.03% or one in 49; Indiana at 2.02% or one in 49; and West Virginia at 2% or one in 50.
“With a few exceptions–most notably New York City and Miami–lower-end markets still have the highest portions of zombie homes. That reflects larger portions of households with limited financial resources to avoid foreclosure,” Barber said. “Those areas are likely at higher risk for issues related to zombie foreclosure if the overall housing market turns back downward.”
States with the lowest overall vacancy rates are New Jersey with 0.33%, or one in 308; New Hampshire with 0.33% or one in 301; Vermont with 0.39% or one in 259; Idaho with 0.43% or one in 230; and North Dakota with 0.64% or one in 155.
Article Source: [www.investopedia.com]