Home Foreclosures Are Rising Nationwide
By Extra-Ordinary Women
The ongoing struggle for Americans to cope with the rising cost of living is leading to a concerning increase in home foreclosures, according to a recent report by ATTOM, a real estate data provider. In the third quarter, foreclosure filings, which encompass default notices, scheduled auctions, and bank repossessions, saw a sharp 28% surge to reach 124,539.
Comparatively, foreclosures are up by a substantial 34% when compared to the same period last year. Rob Barber, the CEO of ATTOM, remarked, “Even with the national economic upturn and job stability, it’s evident that some homeowners are still grappling with the pandemic’s financial aftermath or encountering new challenges.”
The report further highlights that in September alone, there were 37,679 properties with foreclosure filings, marking an 11% increase from the previous month and an 18% rise from 2022. While foreclosures are indeed on the rise, it’s important to note that they remain well below the levels witnessed during the 2008 financial crisis.
Rob Barber added, “Foreclosure starts are nearly back to where they were two years ago when the federal government lifted a pandemic-related moratorium on most foreclosure filings. This rise in foreclosures might also be attributed to pending filings finally processing.”
However, the situation may worsen in the near future due to the resumption of student loan payments. The end of the pandemic-era freeze on federal student loan payments at the start of October has raised concerns among real estate experts, who anticipate a significant impact on the housing market.
A recent poll conducted by Pulsenomics revealed that most economists believe homeownership rates will be adversely affected for at least a year as a result of the resumption of student loan payments, with some predicting a longer-lasting impact. Over 75% of respondents in the survey expressed concerns about a negative effect on homeownership lasting a year or more, and around 40% foresaw an impact lasting at least three years.
Furthermore, many economists believe that the resumption of student loan payments could substantially lower the U.S. homeownership rate, with nearly one-quarter expecting an increase in delinquency rates.
Approximately 44 million borrowers in the U.S. were impacted by the payment pause, which was initially implemented in March 2020 during the onset of the COVID-19 pandemic. Collectively, borrowers are expected to resume paying about $10 billion per month, according to JPMorgan’s analysis.
This potential blow to the housing market comes at a precarious time, primarily due to the significant rise in mortgage rates over the past year. In fact, housing affordability is currently worse than during the peak of the 2008 housing bubble.
