Transcription
Fore foreclosures are up and the real estate market is crashing. Let's check it out.
As more homeowners in the US struggle to keep up with mortgage payments and maintenance costs, new data shows the number of property foreclosures is steadily rising. According to property data from Adam, foreclosure filings rose for 6 months straight year-over-year. And as of August, the number of float foreclosures that was up 18% from the same time last year. Those numbers put the US on track to surpass the roughly 322,000 total properties that went into foreclosure last year.
CBS News contributor Javier Dvid joins us now. He is also a business editor for the Dallas Morning News. Javier, always very good to see you. Uh so despite this surge, US foreclosures, we should mention do remain well below preandemic levels. Given all that though, what factors are behind this recent rise we're seeing?
Yeah, honestly, it's not just one thing or the other, but one big reason. Inflation. It's a stealth tax on everything. And when prices rise and it inevitably triggers a bunch of series of trade-offs, especially for the working and middle class and because housing is more than just one monthly payment, there's all sorts of costs associated with home ownership. They're things you can't control. Plumbing, maintenance, storm damage, insurance, that's a really big cost. Um, all of that costs money in an era of high inflation. It just costs more than it used to. So, for example, there's a state statistic that single family homeowners with a mortgage today pay on average nearly $2,400 more a year for property coverage. That's up nearly 70% from 5 years ago.
That's a huge difference for people's budgets. What are the options that people have if they're struggling to keep up with these payments?
Yeah, there are a slew of, you know, believe it or not, the government, which of course is now shut down, um, has a number of foreclosure assistance programs to help. HUD and FHA have loss mitigation programs. It's designed to ease financial hardships. Cities and states also have their own sort of programs, nonprofit counseling that'll help cash strap borrowers. And a lot of people sort of tend to go into hiding whenever they owe money. And that's not a good idea because uh when you're behind, you can contact your bank or your mortgage issuer directly because they have their own sort of forgiveness and grace programs to address some of these hardship cases. And even if it's just temporary.
Javier, you bring up the the shutdown. How does a shutdown here impact mortgage rates in the real estate market?
Yeah, it's a subterranean economic effect. It kind of depends on how long it lasts. Uh, basically the shutdown is a source of uncertainty in markets and that helps drive rates higher, which of course is bad, or lower, which would be good to help kind of stimulate demand for mortgages. Right now, thus far, we haven't seen much of an impact on rates, but the longer the impact drags on, the more the uncertainty rises. Um, and that's just not good for rate stability.
All right, Javier Devid, thank you very much for being here.
All right, so here's the thing. Research. Most people don't do it, right? They see a YouTube clip, real estate's crashing, 2008 all over again. But let me show you all how to actually look this look these things up. So, what we're looking at right now is what's called Atom data. They mentioned that in the uh news article. See right here? Atom ATOM. Okay, they they keep up. They are data furnishers. They keep up with a lot of data. They have your information. They have my information. Um, this is just a a a data source, right? So, as you can see right here, US foreclosure starts. Okay, so we're looking at right now is Q3 of 2025 down here on the bottom on the right. Now, this is 2008. Okay, most people think that we're going to end up in a 2008 type of scenario. Um, or that we are in a 2008 scenario. We are nowhere near as close. Not even close. Okay, so we're under a h 100,000. Um, and as you can see, we were damn close to 600,000 during the uh 2008 financial crisis, right? And the reason why, for those that don't know, um, there were so many foreclosures in the 2008 financial crisis. I mean, you could have worked at McDonald's back then. I remember it. You could have worked at McDonald's back then and you could have purchased a home as long as you had a driver's license and a bank account. You could have bought a home. Okay? You could have bought a multi-million or a million dollar home off of a McDonald's salary. Okay? Essentially, what they would do is they would manipulate the mortgage payment. So, like, you know, for the first year or so, however, you know, it was almost similar to an adjustable rate mortgage. They would set it up so that your payment is like 500 and then it would jump to like 5,000, right? So it was essentially it was a form of like mortgage fraud although the banks were doing it but it was it was like you know they left the consumers holding the bag because they didn't have what we have in place now is called know your customer right so they didn't know the customer they were just like hey you got a driver's license you got a job boom you get a house okay so now what you see is something that's totally different like a lot of this is most likely due to job loss um there are several other things that are going on the increase in property taxes is the increases insurance. So insurance in a lot of areas like Florida is increasing. Um there are several other factors. So right here they have US properties with foreclosure filings. Again it's it's low, right? Compared to um you know the uh 2008 2009 financial crisis, right? So they had close to a million actual filings um versus the you know under 600,000 starts or so. And then if you come here completed foreclosures right okay under 300,000 and the actual completed foreclosures okay we are very low right now again foreclosures is is it's a it's a long process. It takes a long time for the bank to actually get the property back. um these banks do not even want the property because nine times out of 10, you know, they're going to have to sell at a loss. There's a whole process for them to even sell the property. Once they take it back, there's a process for them to sell it, right? And then the the property lose value because nine times out of 10, they've been sitting for a long time. Um if they if the owner left and it wasn't properly winterized, that that's like a totally total separate um issue that that causes, right? And and it affects the value, right? So, as you can see right here, states that that had the greatest number of ROS in Q3 2025 were Texas, California, and Florida. Again, California, wildfires, uh Florida, you had uh you have, you know, hurricane issues, right? Um Pennsylvania, and New York. Now, I'm not 100% sure what's going on in Pennsylvania and New York or Texas. Uh I'm not at all familiar with with with those markets, so I'm not sure what is exactly is going um on there. And then again, I talked about average days to complete foreclosure, right? So, as you can see here, you know, right now it takes 608 days, right? So, that's over a year for a foreclosure to to to finish. Um, and then of course around the pandemic time, it was almost 1,200 1,200 days, right? So, that's like four years, right? So, again, you know, the headlines say one thing and I get it. It gets clicks. It gets views. We make a ton of money when it comes to YouTube um talking about these real estate crashes and all that type of stuff. Um but again, you know, when you actually look at the data, we aren't anywhere near anything from 2008. So, we don't have bad mortgages to cause a 2008 issue. Okay? Again, a lot of these places is the increase in taxes, which is most likely what the issue is in um Texas, Pennsylvania, and New York. You have the increase in insurance, right? Because your mortgage payment is your mortgage payment. you know, your your uh principal, interest, um your and of course your taxes can change and your insurance can change, right? So that can cause your mortgage rate to either go up or go down. In most places, almost 100% of places, your insurance and your taxes are not going to go down, right? It's it's it's just a part of the game, right? Um you know, my taxes went up, right? You know, it's just a part of the game, right? So, um it's it's it's just a part of owning a home. And of course, if you're a renter and the the landlord's taxes go up, well, they're going to add that to your rent to to cover that. So, even if you're a renter, that's one of the reasons why rents go up. A lot of people are saying, "Hey, rent should be cap. Rent should be capped." Well, if they start capping rents, then a lot of these uh landlords are going to start selling their property. Cuz if you if you put a cap on rent, that landlord, their taxes are still going to increase and you know, the insurance is still going to increase, right? Um in most places. So, um, that's the reason why you see rents continuing to go up because it's like, you know, it's a business. Why why why would you any every other business passes the cost on to consumers, your grocery store chains, your Amazon's, your gas stations, right? They pass the cost on to the to the consumers, the federal government. Like, it it is what it is, right? They all do it. So, I just want to just show you all um again, it's one thing to run with the headlines. It's another it's another to look at the actual data. Are they going up? Yes. But it's not like a sharp up like this right here. Okay. It's it's just a gradual increase. Of course, it was a lot lower during the pandemic because, you know, they were having these um giving people leeway like, "All right, we know outside is messed up. You can sell the house. You don't got to pay nothing, right?" But now off of that, we saw that that move up because they said, "All right, pandemic's over. You back outside. You got to start paying. You don't got the money." And then it started to creep up. It's sort of flat. A little bit of bumps here and there. Now it's starting to creep up because of the shape of the economy, right? Um, you know, we're starting to see people lose jobs and this, that, and the third. Everything has some sort of effect. Every cause has an effect, right? You know, with the uh push in immigration, that has an effect on the economy. Okay? It it it most definitely does. All right? So, I just wanted to just show you all this, give you all some the actual data, the facts that matter. How you feel doesn't matter. If you feel that the real estate market is crashing, how you feel doesn't matter. What matters is the actual numbers.