Foreclosures are rising once again across the United States, as more homeowners face financial pressure in today’s high-cost, high-interest-rate environment. According to new data from property analytics firm ATTOM, 35,697 properties saw foreclosure filings in August 2025 — including default notices, scheduled auctions, and bank repossessions.
That figure represents a slight 1% dip from July, but a significant 18% increase compared to August 2024. It’s the sixth straight month of year-over-year increases and the third consecutive month showing double-digit annual growth.
“While overall foreclosure activity remains below pre-pandemic levels, the ongoing rise in starts and completions indicates that financial stress is mounting for some households,” said Rob Barber, CEO of ATTOM.
Mounting Pressure on Homeowners
The rise in foreclosures comes amid persistent affordability challenges. Mortgage rates remain elevated, and while home prices have cooled slightly since their pandemic-era peaks, many homeowners are finding themselves squeezed between high monthly payments and diminished home equity.
“The recent spike in foreclosures highlights the affordability crunch,” said Hannah Jones, senior economic research analyst at Realtor.com®. “Some homeowners are stuck — unable to afford their housing costs but also unable to sell without taking a loss.”
According to Realtor.com’s August 2025 Monthly Housing Trends Report, the national median list price held steady at $429,990 — flat year-over-year but down 2.2% from July, which is typical for late summer. However, compared to pre-pandemic levels in August 2019, the typical home list price has surged 36.1%, and the price per square foot is up 51.3%.
Where Foreclosures Are Rising the Fastest
Nationwide, 1 in every 3,987 housing units received a foreclosure filing in August. But some states are seeing far higher rates:
- Nevada: 1 in every 2,069 homes
- South Carolina: 1 in every 2,152
- Florida: 1 in every 2,512
Florida, in particular, is grappling with overlapping financial burdens. “Homeowners in Florida are facing a triple threat: rising adjustable-rate mortgage payments, skyrocketing insurance costs, and inadequate coverage after major hurricanes,” said Chad D. Cummings, a Florida-based real estate and tax attorney.
These factors are pressuring sellers to list homes faster or cut prices to avoid competition from foreclosed properties. Buyers, meanwhile, are walking away from deals when insurance costs push monthly payments beyond their budget.
Cities Hit the Hardest
At the metro level, ATTOM identified several areas with the highest foreclosure rates:
- Lakeland, FL: 1 in every 1,212 housing units
- Columbia, SC: 1 in every 1,347
- Chico, CA: 1 in every 1,545
- Cleveland, OH: 1 in every 1,755
- Ocala, FL: 1 in every 1,816
Among large metro areas with over 1 million residents, Cleveland had the highest rate, followed by Las Vegas, Jacksonville, Houston, and Orlando.
Foreclosure Starts Driven by Texas, Florida, and California
Much of the recent spike in foreclosure activity is being driven by new filings. In August, lenders initiated the foreclosure process on 24,254 properties — nearly unchanged from July but up 17% year-over-year.
The top five states for new foreclosure starts were:
- Texas: 2,982
- Florida: 2,803
- California: 2,558
- New York: 1,207
- Illinois: 1,170
At the city level, New York City led the nation with 1,431 foreclosure starts, followed by Houston, Chicago, Los Angeles, and Miami.
According to Cummings, the data reflects deeper financial issues: “Florida and Texas alone saw nearly 33,000 foreclosure starts in the first half of 2025. That’s not just about housing — it’s about dwindling savings, tapped-out home equity, and the end of pandemic-era financial cushions.”
A Warning Sign, But Not 2008
Experts agree the uptick is troubling but caution against drawing comparisons to the 2008 housing crisis — at least for now.
“This growth is coming off historically low levels,” said Jones of Realtor.com®. “Foreclosures are still relatively rare by pre-pandemic standards. But if affordability doesn’t improve, we could see a slow but steady climb in distress sales.”
For now, the message is clear: homeowners and buyers alike are under growing pressure as the market adjusts to a new financial reality — one shaped by inflation, high borrowing costs, and a shrinking margin for error.
