Zombie foreclosures are up 3 percent from Q1 to Q2 2022if foreclosure activity increases by 13 percent; Rise in vacant properties facing foreclosure marks first gain in a year; Zombie real estate still represents only one in every 13,200 residential properties in the US and remains vacant every year
Irvine, California – June 2, 2022 – ATTOM, a nation’s leading real estate data curator for land and ownership data, today released its Second Quarter 2022 Vacant Property and Zombie Foreclosure Report showing that 1.3 million (1,304,007) residential properties in the United States are vacant stand. That equates to 1.3 percent, or one in 76 households nationwide.
The report analyzes publicly recorded real estate data collected by ATTOM – including foreclosure status, equity and ownership status – and matches it to monthly updated vacancy data. (See full methodology below). US residential vacancy data is available at https://www.attomdata.com/solutions/marketing-lists/.
The report also shows that 259,166 US residential properties are in the process of foreclosure in the second quarter of this year, up 12.7 percent from the first quarter of 2022 and 15.9 percent from the second quarter of 2021. This is also the third The number of properties facing foreclosure has risen for the fourth straight quarter since a nationwide moratorium on foreclosures imposed early in the coronavirus pandemic was lifted in late July 2021.
Of those properties awaiting foreclosure, 7,569 are vacant as of the second quarter of 2022, meaning zombie foreclosure properties are up 2.8 percent quarter-on-quarter.
“The incidence of zombie foreclosures tends to be higher in cases where the foreclosure process has dragged on for many months and sometimes even years,” said Rick Sharga, executive vice president of market intelligence at ATTOM. “We are now seeing properties where the borrower was already in default prior to the government moratorium re-entering the foreclosure process and no doubt some of these homes will have been vacated in the last 26 months.”
Zombie foreclosures are down 6.3 percent year-on-year and remain a tiny fraction of the nation’s total of 99.7 million homes. Just one in 13,171 homes in the second quarter of 2022 is vacant and in foreclosure , meaning most neighborhoods don’t have one. The proportion of pre-foreclosure properties that have been placed in zombie status also continues to decline, from 3.6 percent a year ago to 3.2 percent in the first quarter of 2022 and 2.9 percent in the second quarter of this year.
But the recent increase in zombie properties is the first since the end of the moratorium. The percentage of all homes vacant in foreclosure increased 1.9 percent in the second quarter from 13,424 in the first quarter of this year.
The uptrends in foreclosures in the second quarter — both total and zombie homes — add to a list of measures that show the decades-long boom in the U.S. housing market remains strong, but also faces a possible slowdown this year .
Average single-family home prices have skyrocketed 17 percent over the past year, and typical home seller profits remain historically high at nearly 50 percent. Homeowner equity continues to rise, severely limiting the likelihood that homeowners facing foreclosure will simply walk away from their homes.
“According to our equity report, nearly 90 percent of homeowners in foreclosure have positive equity,” Sharga added. “Having equity gives struggling homeowners an opportunity for a relatively soft landing — selling their home for a profit rather than losing it all in foreclosure. That factor alone should keep zombie foreclosures from escalating too much.”
Average home values nationwide rose just 3 percent from the third quarter of last year to the first quarter of this year, and home seller profits fell in 2022 to their lowest level since 2008. In addition, an estimated 1.5 million to 2 million homeowners defaulted on mortgages , after the pandemic wiped out millions of jobs before the economy recovered last year.
Zombie foreclosures are increasing quarterly but still declining annually
A total of 7,569 homes facing possible foreclosure were evicted nationwide in the second quarter of 2022, up slightly from 7,363 in the first quarter of 2022 but still down from 8,078 in the second quarter of 2021.
Amid still extremely low numbers, the biggest gains from Q1 2022 to Q2 2022 in states with at least 50 zombie foreclosures are Michigan (zombie real estate increased 74 percent from 54 to 94), Arizona (increase 56 percent , from 32 to 50), Georgia (up 29 percent, from 62 to 80), Nevada (up 26 percent, from 68 to 86) and Iowa (up 17 percent, from 132 to 155).
The largest quarterly declines among states with at least 50 zombie foreclosures are in Massachusetts (zombie real estate down 13 percent from 62 to 54), Missouri (down 13 percent from 63 to 55), New Jersey (down 7 percent from 275 to 257), New Mexico (down 3 percent from 78 to 76) and New York (down 2 percent from 2,074 to 2,041).
Overall vacancy rates are declining annually in most countries
The vacancy rate for all US residential properties fell to 1.31 percent in the second quarter of 2022 (one in 76 properties). That’s down from 1.37 percent in the first quarter of 2022 (one in 73) and from 1.42 percent in the second quarter of last year (one in 70).
States with the largest annual declines are Tennessee (from 2.42 percent of all households in the second quarter of 2021 to 1.55 percent in the second quarter of this year), Oregon (from 1.84 percent to 1.01 percent), Maryland (from Jan .67 percent to 1.55 percent). percent to 1.05 percent), Wisconsin (from 1.36 percent to 0.76 percent) and Minnesota (from 1.54 percent to 0.95 percent).
Other high-level insights from the second quarter of 2022:
- Among U.S. metropolitan areas with at least 100,000 residential properties and at least 100 properties facing possible foreclosure in Q2 2022, the highest zombie rates are in Peoria, IL (11.3 percent of foreclosure properties are vacant); Wichita, Kansas (11.2 percent); Cleveland, OH (9.5 percent); Syracuse, NY (8.9 percent); and South Bend, IN (8.6 percent).
- Aside from Cleveland, the highest zombie foreclosure rates in major metropolitan areas with at least 500,000 residential properties and at least 100 homes facing foreclosure in the second quarter of 2022 are in Baltimore, MD (8.3 percent of foreclosed homes are vacant). ; Portland, OR (6.5 percent); Indianapolis, IN (5.9 percent); and Pittsburgh, PA (5.9 percent).
- Of the 164 metropolitan areas analyzed for this report, those where zombie homes accounted for the largest percentage of all residential housing in Q2 2022 are Cleveland, OH (one in 1,426 homes is vacant and facing foreclosure); Peoria, IL (one of 1,565); Albany, NY (one of 1,725); Syracuse, NY (one of 2,195) and Rochester, NY (one of 2,964).
- Of the 27.9 million homes in the US in the second quarter of 2022, about 905,000, or 3.2 percent, are vacant. The highest investor-owned vacancy rates are in Indiana (6.9 percent), Kansas (5.8 percent), Oklahoma (5.3 percent), Alabama (5.1 percent), and Ohio (5 percent).
- Of the roughly 3,300 foreclosed bank-owned homes in the US in the second quarter of 2022, 10.8 percent are vacant. In states with at least 50 bank-owned homes, the highest vacancy rates are in Pennsylvania (19.9 percent vacant), Indiana (17.2 percent), Texas (16.4 percent), Ohio (16 percent), and Illinois (15.9 percent) .
- The highest zombie foreclosure rates in US counties with at least 500 properties in foreclosure as of Q2 2022 are in Broome County (Binghamton), NY (11.8 percent of homes awaiting foreclosure are vacant); Cuyahoga County (Cleveland), OH (10.8 percent); Onondaga County (Syracuse), NY (9.4 percent); Pinellas County (Clearwater), FL (9.3 percent); and Oneida County, NY (outside Syracuse) (8.3 percent).
- The lowest zombie rates among counties with at least 500 foreclosure properties in the second quarter of 2022 are in Contra Costa County, CA (outside Oakland) (no pre-foreclosure homes are vacant); Hudson County, NJ (outside New York, NY) (0.3 percent); Atlantic County (Atlantic City), NJ (0.4 percent); Mecklenburg County (Charlotte), NC (0.5 percent); and Sacramento County, CA (0.6 percent).
- Among the 424 counties with at least 50,000 residential properties are Broome County (Binghamton), NY (one of 648 properties); Cuyahoga County (Cleveland), OH (one of 933); Peoria County, IL (one of 1,144); Suffolk County (East Long Island), NY (one of 1,165) and Oneida County, NY (outside Syracuse) (one of 1,437).
ATTOM analyzed County Tax Assessors data for approximately 99 million residential properties for vacancy, broken down by foreclosure status and owner status. Only metropolitan areas with at least 100,000 residential properties and counties with at least 50,000 residential properties were included in the analysis. Job vacancy data is available at https://www.attomdata.com/solutions/marketing-lists/.
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