U.S. foreclosure filing dropped in May according to data released by real estate research firm ATTOM. In total, 35,498 properties were subject to foreclosure filings in May, representing a 1.5% decline from April. Compared to the previous year, filings were up 9.8%, signaling that while activity is rising year-over-year, the overall market remains stable.
On average, one in every 4,009 housing units across the country had a foreclosure filing in May. The data indicates that foreclosures are returning to more typical levels following the artificial lows during pandemic-era forbearance periods.
Foreclosure Filings Dropped But California Still Ranks High
California posted one foreclosure filing for every 3,515 homes, placing the state 13th in the nation for foreclosure rate. While foreclosure filings dropped on a national scale, several areas in California—including Lake, Plumas, and Shasta counties—reported elevated activity.
Housing experts say these pockets of increased filings reflect regional economic stress rather than a statewide trend. Despite this, California’s housing affordability issues continue to place pressure on some borrowers, especially in rural counties where job opportunities are more limited.
Foreclosure Filings Dropped Amid Job Market Strength
The labor market remains a key factor stabilizing foreclosure rates. Nationally, employment levels remain strong and wage growth continues, giving many homeowners the ability to stay current on mortgage payments. These positive conditions are helping to offset inflation-related pressures and higher interest rates.
Additionally, record-high home prices in April have bolstered home equity, giving struggling homeowners more options to avoid foreclosure through refinancing or home sales. Analysts note that rising equity acts as a cushion, reducing the risk of forced property loss.
Foreclosure Filings Dropped, Outlook Remains Cautiously Stable
Looking ahead, experts do not anticipate a major surge in foreclosures over the next year. With steady job growth and strong home values, most homeowners are expected to maintain stability. Still, consumer advocates urge borrowers to seek help early if they face financial hardship.
Though foreclosure filings dropped in May, year-over-year increases highlight the need for continued attention to local economic indicators and housing affordability. For many markets, current trends suggest a return to normalcy—not a looming crisis.
