Foreclosure Activity Highest Since Pandemic Began

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Completed foreclosures have reached their highest level since March 2020. Foreclosure filings, which include default notices, scheduled auctions, or bank repossessions, jumped by 29% in January over December and are up by 139% compared to a year ago, according to the January 2022 U.S. Foreclosure Market Report, released by ATTOM Data Solutions.

Should the housing market be concerned?

The numbers are still below historical levels of foreclosure activity, housing experts say. There are still less than half as many foreclosure completions now as in January of 2020 before the pandemic surged in the U.S., and there are about 60% less than in 2019.

“We’re likely to continue seeing large year-over-year percentage increases for the rest of the year,” says Rick Sharga, executive vice president of RealtyTrac, an ATTOM Data company. “But it’s also likely that foreclosure activity will remain below historically normal levels until the end of 2022.”

Sharga says that January’s uptick in foreclosure activity wasn’t a surprise. “Foreclosures typically slow down during the holidays in November and December and pick back up after the first of the year,” he says. “This year, the increases were probably a little more dramatic than usual since foreclosure restrictions placed on mortgage servicers by the CFPB expired at the end of December.”

The states that posted the largest increases in January were Michigan (up 622%), Georgia (up 163%), Texas (up 98%), Tennessee (up 50%), and Alabama (up 44%). By metro area, the largest upticks were in Detroit, Chicago; New York, Miami, and Philadelphia.

The metro areas are with the highest overall foreclosure rates in January 2022 were:

  • Detroit.: one in every 1,547 housing units with a foreclosure filing
  • Atlantic City, N.J.: one in every 1,564 housing units
  • Cleveland: one in every 1,659 housing units
  • Columbia, S.C.: one in every 1,921 housing units
  • Trenton, N.J.: one in every 2,299 housing units