Will Foreclosures Increase in 2024? A Look at 2024 Trends

If you’re trying to figure out what will happen with foreclosures in the near future and how that will affect you, you’re not alone.

Foreclosure rates are often used as a signal of the health and stability of the real estate market. Generally speaking, when foreclosure rates are low, the market and economy are healthy and happy. But when foreclosures spike up, problems can be on the horizon.

Let’s go back a step. In 2021 and 2022, foreclosures hit some of the lowest percentages ever thanks to pandemic relief programs, federal foreclosure moratoriums, and a hot real estate market.

But now it’s 2024, and those pandemic relief programs designed to get people into homes and help them keep those homes are being phased out and ending. As a result, foreclosures have started to increase.

But contrary to the worries that are out there, the data paints an optimistic picture of the market. Right now in 2024, the market is showing a modest 60% of pre-pandemic foreclosure levels. This isn’t the crazy swing upward that many were concerned about. Rather than a sign of market instability, this is seen as a market correction by experts.

Additionally, industry experts project that a return to foreclosure levels of 2019 may not happen until mid to late 2024, with some forecasts even indicating a prolonged stabilization around 2023 levels.

So, why haven't foreclosures surged as expected? The strong real estate market allowed homeowners to see substantial appreciation in their homes’ values from 2020 onwards. The equity increase gave them more ownership and significantly decreased the risk of foreclosure.

The data shows that foreclosures are not signaling doom for real estate. Instead, we’re seeing a market correction after the ending of government relief programs.

This information shows how important it is to stay up to date with the local real estate market so you can make the best decisions for your real estate goals. Want to talk more?

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