Residential News » Irvine Edition | By Michael Gerrity | May 25, 2023 8:15 AM ET
Based on ATTOM's newly released second-quarter 2023 Vacant Property and Zombie Foreclosure Report, almost 1.3 million (1,285,633) residential properties in the United States are vacant. That figure represents 1.3 percent, or one in 79 homes, across the nation.
The report also reveals that 311,508 residential properties in the U.S. are in the process of foreclosure in the second quarter of this year, up 4.3 percent from the first quarter of 2023 and up 20.2 percent from the second quarter of 2022. A growing number of homeowners have faced possible foreclosure since a nationwide moratorium on lenders pursuing delinquent homeowners, imposed after the Coronavirus pandemic hit in early 2020, was lifted in the middle of 2021.
Among those pre-foreclosure properties, 8,752 sit vacant as zombie foreclosures (pre-foreclosure properties abandoned by owners) in the second quarter of 2023. That figure is up 7.5 percent from the prior quarter and up 15.6 percent from a year ago. The count of zombie properties has grown in each of the last five quarters, dating back to early in 2022.
Still, the number of zombie foreclosures remains historically low, with little impact on the nation's total stock of 101.3 million residential properties.
"Zombie foreclosures keep inching up as lenders pursue more delinquent homeowners in courts around the country. All indications are that the number of zombie properties will keep going up slowly, given that foreclosures are up," said Rob Barber, chief executive officer for ATTOM. "But abandoned properties are still nothing more than a dot on the radar screen among the majority of neighborhoods. We are still a long way from the fallout after the Great Recession of the late 2000s, when this was a very real issue in many areas around the U.S."
The lack of zombie foreclosures throughout most of the country continues to stand out as one of the most significant effects of the U.S. housing market boom that more than doubled the national median home value from 2012 to 2022.
Zombie foreclosures rise again but still pose no issues in most neighborhoods
A total of 8,752 residential properties facing possible foreclosure have been vacated by their owners nationwide in the second quarter of 2023, up from 8,141 in the first quarter of 2023 and from 7,569 in the second quarter of 2022. The number of zombie properties has grown quarterly in 29 states and annually in 36.
While most neighborhoods around the U.S. have little or no zombie foreclosures, the biggest increases from the first quarter of 2023 to the second quarter of 2023 in states with at least 50 zombie properties are in Texas (zombie properties up 47 percent, from 114 to 168), Ohio (up 26 percent, from 846 to 1,070), Oklahoma (up 22 percent, from 142 to 173), Georgia (up 22 percent, from 78 to 95) and Iowa (up 21 percent, from 227 to 274).
The only quarterly decreases among states with at least 50 zombie foreclosures are in Michigan (zombie properties down 20 percent, from 74 to 59), South Carolina (down 2 percent, from 154 to 151), Pennsylvania (down 1 percent, from 404 to 401) and New York (down less than 1 percent, from 2,006 to 2,000).
New York continues to have the highest ratio of zombie homes to all residential properties (one of every 2,140 homes), followed by Ohio (one in 3,615), Iowa (one in 4,480), Illinois (one in 4,687) and Florida (one in 5,926).
Overall vacancy rates unchanged
The vacancy rate for residential properties in the U.S. has remained the same in the second quarter of 2023 after dropping in the prior three quarters. It now stands at 1.27 percent (one in 79 properties), the same as in the first quarter of 2023, but still down from 1.31 percent in the second quarter of last year (one in 76).
States with the biggest annual drops in the overall vacancy rate are Tennessee (down from 1.55 percent of all homes in the second quarter of 2022 to 1.02 percent in the second quarter of this year), Michigan (down from 2.14 percent to 1.88 percent), Georgia (down from 1.61 percent to 1.39 percent), Minnesota (down from 0.95 percent to 0.73 percent) and New Jersey (down from 0.53 percent to 0.36 percent).
Other high-level findings from the second quarter of 2023: