Zombie foreclosures—properties that are in the process of foreclosure while sitting empty—are down 4.4 percent from the third quarter of 2020, according to ATTOM Data Solutions’ latest Vacant Property and Zombie Foreclosure Report.
According to ATTOM, there are a total of 1.6 million homes (1.6 percent of all homes) are currently vacant. The report also showed that about 200k properties are currently in the process of foreclosure—a 7.3 percent decrease from the third quarter. The number of pre-foreclosure properties that were abandoned has increased, from 3.7 percent in the third quarter to 3.8 percent.
“Zombie foreclosures have been barely an issue around most of the country for over a year, and they’re even less of one now. A surprisingly strong housing market and a temporary ban on foreclosures continues to leave most neighborhoods without a single such property,” said Todd Teta, chief product officer with ATTOM Data Solutions. “All that could change in a flash when foreclosures are allowed to resume or if the coronavirus takes a toll on the market. But for now, things are steady as they go, with the overall numbers down and the rates of zombie properties pretty much unchanged.”
On a regional basis, the Midwest and South are seeing the highest zombie foreclosure rates. In Iowa, 15.5 percent, or one in six properties, are in the foreclosure process; in Kentucky, it’s 12 percent, or one in eight; Missouri, 10.2 percent or one in 10; Georgia, 9.6 percent or one in 10; and Maryland, 9.2 percent or one in nine.
The following areas have the highest zombie property rates:
– New York: 2,1131
– Florida: 1,027
– Illinois: 934
– Ohio: 836
– New Jersey: 346
– California: 234
“It’s worth noting that while foreclosure moratoria have caused the number of zombie properties to drop slightly, the percentage of foreclosure properties in zombie status has increased,” said Rick Sharga, executive vice president for RealtyTrac, an ATTOM Data Solutions company. “It’s likely that as the length of time it takes to execute a foreclosure continues to increase, we’ll also continue to see the percentage of vacant and abandoned foreclosure homes increase.”
“Some of the states with the highest rate of zombie foreclosure properties are also states that have been among the hardest hit by the COVID-19 pandemic,” Sharga noted. “When the government bans on foreclosure activity expire, it wouldn’t be a surprise to see the number of defaults in those states increase more rapidly than in other parts of the country, and the number of zombie foreclosure properties rise more dramatically in those states as well.”