News Summary
As of July 2025, the U.S. faces a rise in zombie foreclosures, with 3.38% of all properties in foreclosure classified as abandoned. This marks growth from previous periods and indicates challenges within the housing market, despite overall stability. The data reveals geographic disparities, with significant increases in states like North Carolina and Texas, as well as concerning foreclosure rates in specific counties. The housing market’s resilience is under threat from these trends, pointing to the need for addressing vacant properties to maintain stability and property values.
Increase in Zombie Foreclosures Signals Emerging Challenges in U.S. Residential Housing Market
As of July 2025, zombie foreclosures—defined as abandoned pre-foreclosure homes—have risen to represent 3.38% of all residential properties in foreclosure across the United States. This marks a slight increase from the previous quarter and the same period in 2024, according to the latest data from ATTOM’s Q3 2025 Vacant Property and Zombie Foreclosure report.
The report highlights a concerning trend in the housing market, with a total of 222,358 properties reported in the foreclosure process during Q2 2025. While this represents a 4.8% increase from the previous quarter, it shows a 6.3% decline compared to the same period last year. The slight growth in zombie foreclosures is a key indicator of distress within the housing market that could adversely affect neighborhood property values.
The current landscape includes approximately 1.39 million vacant homes, which constitutes 1.3% of all U.S. homes. This vacancy rate has remained steady for over three years, indicating that despite strong demand in the housing market, many homes remain unoccupied. Alarmingly, a total of 7,329 pre-foreclosure properties were classified as zombie homes in Q2 2025, accounting for 3.3% of those in the foreclosure process. This figure shows a slight increase from 2.9% in the previous year.
The data reveals a geographic disparity in zombie foreclosures. Seven of the top ten states with the highest rates are judicial foreclosure states, characterized by longer foreclosure processes. Notably, Arizona is among the exceptions, having a non-judicial foreclosure process. The concentration of zombie properties within these states raises concerns about the potential for declining neighborhood values and housing stability.
Year-over-year comparisons of zombie properties show significant increases in several states, with North Carolina seeing a sharp rise of 52.5%, followed closely by Iowa (52.1%) and Texas (51.9%). Additionally, South Carolina and Kansas recorded year-over-year percentage increases of 43.8% and 29%, respectively.
While the total number of zombie properties has increased, overall, only one in every 14,207 U.S. homes were classified as zombie properties in Q2 2025. This reflects a level of resilience within the post-pandemic housing market, as many areas have demonstrated stability despite challenging conditions.
Within individual counties, significant rates of zombie foreclosures were reported in Q2 2025. The top counties affected included Peoria County, Illinois, with a rate of 17.6%, followed by Broome County, New York at 13.8%, and Cuyahoga County, Ohio at 11.2%. Other notable counties include Baltimore City County, Maryland (10.8%), Marion County, Indiana (10.5%), and Lucas County, Ohio (9.9%).
Overall, the outlook for the housing market suggests that while demand remains high, the rise in zombie foreclosures symbolizes underlying challenges that could impact future housing stability. Addressing vacant and distressed properties will be crucial to maintaining property values and encouraging growth in the residential housing market. As the housing situation continues to evolve, monitoring these indicators will be vital for understanding the broader market trajectories moving forward.
Deeper Dive: News & Info About This Topic
- ROI-NJ: Zombie Foreclosures Rise as U.S. Vacancy Rates Hold Steady
- Realtor.com: Zombie Foreclosures Report
- Realtor.com: States with Most Zombie Foreclosures – August 2025
- ATTOM: Top 10 Counties with Highest Zombie Foreclosure Rates in Q2 2025
- PR Newswire: U.S. Foreclosure Activity Increases Quarterly in Q1 2025
- Wikipedia: Zombie Foreclosure
- Google Search: Zombie Foreclosures
- Google Scholar: Zombie Foreclosures
- Encyclopedia Britannica: Zombie Foreclosures
- Google News: Zombie Foreclosures
Author: STAFF HERE PHOENIX WRITER
PHOENIX STAFF WRITER The PHOENIX STAFF WRITER represents the experienced team at HEREPhoenix.com, your go-to source for actionable local news and information in Phoenix, Maricopa County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as the Waste Management Phoenix Open, Cactus League Spring Training, and Arizona State Fair. Our coverage extends to key organizations like the Greater Phoenix Chamber of Commerce and Visit Phoenix, plus leading businesses in technology and healthcare that power the local economy such as Intel and Banner Health. As part of the broader HERE network, including HERETucson.com, we provide comprehensive, credible insights into Arizona's dynamic landscape.
