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Banks take back 367,000 homes in foreclosure surge across US

For American homeowners hoping that 2026 would bring with it some sort of immediate financial relief, it’s bad news, we’re afraid. Property foreclosures are on the rise again, dragging anxiety back into neighbourhoods that had largely forgotten the meaning of the word. Numbers show that lenders moved to seize hundreds of thousands of homes last year, a shift that signals real strain beneath the surface of the American housing market. While this isn’t 2008 (thankfully), plenty of warning signs are flashing. Higher costs, stubborn interest rates and shakier job security are combining in ways that feel uncomfortably familiar for many households trying to stay afloat in America today. (Picture: Getty Images)

New figures show the extent of the problem. A total of 367,460 US properties entered foreclosure proceedings during 2025, according to nationwide property data experts ATTOM. That represents a 14% jump compared with the previous year, marking a clear turnaround from the unusually low levels seen in the early 2020s. Each foreclosure represents a household that missed mortgage payments and fell far enough behind for lenders to step in. For many, this didn’t happen overnight but followed months of juggling bills and falling behind elsewhere. (Picture: Getty Images)

What worries economists is what comes next. Some see 2025 as the warm-up act rather than the main event. Economist Michael Szanto has warned that a softer labour market could rapidly make the situation worse. He said: ‘If the job market weakens, and it may very well, then we could unfortunately down the road see the increase in the foreclosure rate significantly accelerate,’ Daily Mail reports. (Picture: Getty Images)

The broader economy offers little comfort to Americans, either. The US added roughly 584,000 jobs in 2025, the weakest year for job growth outside a recession since 2003. That slowdown matters because mortgage payments rely on steady pay. When jobs become harder to find or hours get cut, housing stress follows quickly. Fewer new jobs also means fewer would be buyers, which locks people into homes they can no longer comfortably afford and removes escape routes that once existed during healthier markets. (Picture: Getty Images)

Foreclosures rarely hurt just one household. When banks take control of properties, they often sell them at reduced prices to move them quickly. That can drag down surrounding home values, even for neighbours who are still paying on time. For homeowners trying to build wealth, it can mean watching equity evaporate for reasons entirely outside their control. Living in the wrong area at the wrong time can suddenly become a very expensive problem. (Picture: Getty Images)

The pain is not evenly spread across the country, however. Florida recorded the highest foreclosure rate in 2025, with one filing for every 230 homes. Szanto said the state’s condo market has been hit particularly hard. ‘Florida is being uniquely affected by a massive rise in assessments for older condo buildings in response to the tragic Surfside collapse,’ he explained. Delaware and South Carolina followed close behind, showing that housing stress is not limited to one corner of the map. (Picture: Getty Images)

Zooming in further makes the picture even more stark. Among large metro areas, Lakeland, Florida posted the highest foreclosure rate in the nation last year, with one in every 145 homes entering the process. Columbia, South Carolina ranked next, followed by Cleveland, Ohio. Florida appeared again with Cape Coral, while Atlantic City joined the list, underlining that both Sun Belt boomtowns and older markets are feeling the pressure. (Picture: Getty Images)

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The largest cities aren’t immune to the issue, either. Jacksonville recorded the worst foreclosure rate among all urban areas with more than one million residents, followed by Las Vegas, Chicago and Orlando. Still, Attom CEO Rob Barber urged caution, saying the data reflects a ‘continued normalisation of the housing market following several years of historically low levels’. (Picture: Getty Images)

Banks take back 367,000 homes in foreclosure surge across US

Ready to start your homebuying journey?

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