Understanding the U.S. Foreclosure Market: A Comprehensive Analysis

In the ever-evolving landscape of the U.S. real estate market, staying informed is paramount. ATTOM, a leading curator of land, property, and real estate data, recently released its Year-End 2023 U.S. Foreclosure Market Report. This comprehensive report sheds light on the foreclosure landscape, offering valuable insights for investors, homeowners, and industry professionals.

Key Highlights

1. Foreclosure Trends

In 2023, foreclosure filings, encompassing default notices, scheduled auctions, and bank repossessions, were reported on 357,062 U.S. properties. This marked a significant 10 percent increase from 2022 and a notable 136 percent surge from 2021. However, compared to 2019, there was a 28 percent decline, showcasing a return to more traditional patterns after the market turbulence induced by the pandemic.

2. National Overview

Foreclosure filings in 2023 represented 0.26 percent of all U.S. housing units, a slight uptick from 2022. However, this remains lower than the 2019 figure of 0.36 percent and the peak in 2010 at 2.23 percent. ATTOM’s CEO, Rob Barber, interprets this rise in foreclosure activity as a market correction rather than a cause for alarm, emphasizing a shift towards more predictable housing landscape patterns.

3. Foreclosure Starts and Declines

Lenders initiated the foreclosure process on 270,222 U.S. properties in 2023, marking a 9 percent increase from 2022. Notable states leading in foreclosure starts were California, Texas, and Florida. Intriguingly, while the national trend showed a decline from 2019, six states, including Indiana and Idaho, witnessed an increase.

4. Bank Repossessions

In 2023, lenders repossessed 42,090 properties through foreclosures, showing a 2 percent decline from 2022. States such as Illinois and Michigan recorded the highest number of REOs. This decline aligns with the overall decrease in foreclosure activity, indicating a controlled and stabilized market.

5. State Foreclosure Rates

New Jersey, Illinois, and Delaware emerged as the states with the highest foreclosure rates in 2023, emphasizing the localized nature of foreclosure trends. Understanding these state-specific dynamics is crucial for investors and industry professionals seeking targeted insights.

6. Metropolitan Foreclosure Rates

Metropolitan statistical areas with populations exceeding 1 million, including Cleveland and Atlantic City, exhibited the highest foreclosure rates in 2023. These localized trends underscore the importance of considering regional factors in real estate investment strategies.

7. Time to Foreclose

The average time to foreclose in the fourth quarter of 2023 decreased by 7 percent from the previous quarter, demonstrating a quicker resolution process. States with the longest average time to foreclose included Louisiana and Hawaii, highlighting regional variations in foreclosure timelines.

In conclusion, ATTOM’s Year-End 2023 U.S. Foreclosure Market Report provides a wealth of information crucial for navigating the complex real estate landscape. As the market corrects itself, understanding these trends empowers investors, homeowners, and industry professionals to plan and strategize with confidence. For a visual representation of the data, we recommend a diagram illustrating the key trends in foreclosure activity.