Abandoned Homes In Foreclosure Down 20% Annually – NMP Skip to main content

Abandoned Homes In Foreclosure Down 20% Annually

Aug 22, 2024
foreclosure sign
Staff Writer

ATTOM attributes the decline in foreclosure rates and the low number of zombie foreclosures to high homeowner equity.

Nearly 1.4 million (1,357,423) residential properties in the United States are vacant, equating to 1.3%, or one in 76 homes, across the nation – roughly the same as in the second quarter of this year. That's according to ATTOM's third-quarter 2024 Vacant Property and Zombie Foreclosure Report, released today. 

The report analyzes publicly recorded real estate data collected by ATTOM — including foreclosure status, equity, and owner-occupancy status — matched against vacancy data updated monthly.

The report also reveals that 222,934 residential properties in the U.S. are in the process of foreclosure in the third quarter of this year, down 6% from Q2 2024 and down 29.3% from Q3 2023.

Foreclosure activity has declined over the past year following a surge in cases that hit after a nationwide moratorium on lenders pursuing delinquent homeowners — imposed during the COVID-19 pandemic — was lifted in the middle of 2021.

Among those pre-foreclosure properties, about 7,000 sit vacant as zombie foreclosures, meaning pre-foreclosure properties abandoned by owners, in Q3 2024. That figure is slightly above the number in the prior quarter, but down 20.2% from a year ago.

The latest count of zombie homes continues a long-term pattern of those properties representing only a tiny portion of the nation’s total housing stock — currently at just one of every 14,776 homes around the U.S. The ratio is about the same as the level of one in 14,724 in the prior quarter, but well down from one in 11,565 in the third quarter of last year, marking the lowest level since early 2021.

The portion of pre-foreclosure properties that have been abandoned into zombie status, meanwhile, ticked up a bit, from 2.9% in the second quarter of 2024 to 3.1% in the current quarter.

“Zombie foreclosures continue to be a mere blip on the radar screen — one of many measures of the overall strength of the U.S. housing market. After some worries about a rise in abandoned homes following the end of the COVID-era foreclosure clampdown, they remain an anomaly throughout most of the country,” said Rob Barber, CEO of ATTOM. “One significant factor is the historically high levels of home equity. This provides homeowners who may be struggling with their mortgage payments a strong incentive to negotiate new payment plans, which in turn reduces the number of foreclosures. As a result, fewer owners are simply walking away from their properties like so many did after the Great Recession of the late 2000s.”

The nationwide median home value shot up 6% YOY during the Spring of 2024, reaching a new high of $365,000, according to ATTOM’s home sales data. It has increased every year since 2011, more than doubling during that time. Those gains have led to historic improvements in homeowner equity, which has resulted in almost 95% of owners with mortgages having at least some equity built up and half owing less than 50% of the estimated value of their properties.

Zombie foreclosures are mostly unchanged quarterly around the U.S. while down annually. A total of 7,007 residential properties facing possible foreclosure have been vacated by their owners nationwide in the third quarter of 2024, up 0.9% from 6,945 in the second quarter of 2024 but down from 8,782 in the third quarter of 2023. The number of zombie properties stayed the same quarterly or went up slightly in 26 states — usually increasing by less than 20. The number declined in 24 states.

The vacancy rate for all residential properties in the U.S. has remained virtually the same for 10 quarters in a row, hovering around 1.3%. The latest figure of 1.31% (one in 76 properties) is up slightly from 1.26% in both the second quarter of 2024 and the third quarter of last year.

The top three states with the highest vacancy rates for all residential properties are Oklahoma (2.36%, or one in 42 homes, during the third quarter of this year), Kansas (2.32%, or one in 43), and Missouri (2.11%, or one in 47).

Those with the smallest overall vacancy rates are New Hampshire (0.35%, or one in 282 homes), Vermont (0.41%, or one in 243), and New Jersey (0.43%, or one in 231). 

About the author
Staff Writer
Sarah Wolak is a staff writer at NMP.
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