A new study from ATTOM has determined that 34 of the 50 counties with the most at-risk housing markets in the fourth quarter of 2023 were based in three states.
ATTOM defined at-risk markets based on data related to home affordability, underwater mortgages, foreclosures and unemployment. Counties were considered more or less at-risk based on the percentage of homes facing possible foreclosure, the portion with mortgage balances that exceeded estimated property values, the percentage of average local wages required to pay for major home ownership expenses on median-priced single-family homes and local unemployment rates.
ATTOM said the majority of at-risk markets in the fourth quarter were found in California, New Jersey and Illinois. Within the states, specific regions had the most problematic submarkets: five of the counties were in the New Jersey suburbs around New York City, two were in the New Jersey suburbs of Philadelphia, five were in the Chicago metropolitan area and 14 were in areas of California away from the Pacific coast.
At the other end of the risk spectrum, the Midwest and South had the most markets considered least likely to decline, including nine in Wisconsin and five in Kansas.
“Fault lines running through the foundation of the U.S. housing market continue to appear in different parts of the country, with some areas remaining more or less vulnerable than others,” said Rob Barber, CEO at ATTOM. “As always, this is not a warning sign for homeowners to run out and sell, or rush to buy, in any specific market. The housing market remains strong throughout most of the country despite some recent small downturns. Rather, this report again spotlights areas that appear more or less exposed to a market fall, should that start to happen, based on key measures.”
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