U.S. foreclosure activity did rise in 2025, but the data and experts describe it as a normalization or “market recalibration” rather than the start of a 2008‑style crisis.
What actually happened in 2025
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Around 367,460 U.S. properties had foreclosure filings in 2025, up about 14% from 2024.
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Lenders started foreclosure on roughly 289,000 properties, also a 14% increase from the prior year.
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Bank repossessions (completed foreclosures/REO) climbed to about 46,000, roughly 27% higher than 2024.
Why experts call it a recalibration
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ATTOM’s CEO said the rise “indicates a gradual return to normalcy” after years of unusually low foreclosure activity driven by pandemic-era forbearance and stimulus.
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Filings are still well below pre‑pandemic levels and about 80–90% below the peak of the last housing crisis, so the increase is mostly a move off historic lows, not a systemic collapse.
Signs of stress vs. systemic risk
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ATTOM notes that repeated quarterly increases in starts and completions could signal emerging borrower strain in some regions, especially where affordability is tight and rates are high.
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However, homeowners today generally have stronger equity and benefited from tighter lending standards, which reduces the risk of widespread forced selling.
Regional and international context
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States like Florida, Texas, and some parts of California led foreclosure-rate increases, reflecting local economic and affordability issues rather than a uniform national downturn.
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In the UK, mortgage repossessions ticked higher in 2025, but arrears remained low and industry groups emphasized levels are still significantly below long‑term averages, again consistent with normalization.
What it means for buyers and owners
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For buyers, slightly higher foreclosure activity can create more discounted inventory in certain markets, though not enough to flip conditions into a full buyer’s market nationally.
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For homeowners, the main risks are localized job losses and high debt costs; lenders and regulators still stress workout options, and repossession remains a last resort in both the U.S. and UK.
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