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Vacant Zombie Properties Diminish Across U.S., According to ATTOM Data Solutions

When a home is in foreclosure, and it sits vacant, it is called a zombie….

  • November 27, 2020

When a home is in foreclosure, and it sits vacant, it is called a zombie. Too many of these zombies can really blight a neighborhood and pull property values and quality of life down. A new report shows that we don’t need to fear a swarm of zombies on our streets. Yet.

Property data provider ATTOM Data Solutions has released its fourth-quarter 2020 Vacant Property and Zombie Foreclosure Report showing that 1.6 million (1,556,592) residential properties in the United States, representing 1.6 percent of all homes, are vacant.

The report reveals that 200,065 properties are in the process of foreclosure in the fourth quarter, down 7.3 percent from the third quarter of 2020, while the number sitting empty (7,612) is down 4.4 percent.

The portion of pre-foreclosure properties that have been abandoned into zombie status has ticked up slightly, from 3.7 percent in the third quarter of 2020 to 3.8 percent this quarter.

Among the nation’s stock of 99.5 million residential properties, zombie properties continue to represent just a tiny fraction – only one of every 13,100 homes.

The fourth-quarter 2020 data shows a drop in the number of homes at some point in the foreclosure process and virtually the same rate of zombie foreclosures during a time when the federal government continues trying to shield the housing market from an economic slide stemming from the worldwide Coronavirus pandemic.

A key measure remains a temporary prohibition against lenders foreclosing on government-backed mortgages.

The ban, which is currently in place until December 31 and affects about 70 percent of home loans in the United States, was enacted under the CARES Act passed by Congress in March and then extended to help borrowers who have lost jobs or other sources of income during the pandemic. Some private lenders also have voluntarily offered mortgage extensions.

“Zombie foreclosures have been barely an issue around most of the country for over a year, and they’re even less of one now. A surprisingly strong housing market and a temporary ban on foreclosures continues to leave most neighborhoods without a single such property,” said Todd Teta, chief product officer with ATTOM Data Solutions. “All that could change in a flash when foreclosures are allowed to resume or if the Coronavirus takes a toll on the market. But for now, things are steady as they go, with the overall numbers down and the rates of zombie properties pretty much unchanged.”

Midwest and South have highest zombie foreclosures rates

A total of 7,612 residential properties facing possible foreclosure have been vacated by their owners nationwide in the fourth quarter of 2020. That figure comprises 3.8 percent, or one in 26, of all properties in the foreclosure process.

Those numbers are up slightly from 3.7 percent, or one in 27, in the third quarter of 2020, and up from 3 percent, or one in 34 properties, the fourth quarter of 2019.

States with the highest zombie foreclosure rates remain clustered in the Midwest and South. The top rates among states with at least 50 properties in foreclosure and vacant include Iowa (15.5 percent, or one in six properties in the foreclosure process), Kentucky (12 percent, or one in eight), Missouri (10.2 percent, or one in 10), Georgia (9.6 percent, or one in 10), and Maryland (9.2 percent, or one in nine).