When it feels like the cost of just about everything is rising, it’s only natural to wonder what that means for the housing market. Some people are even questioning whether more homeowners will struggle to make their mortgage payments, ultimately leading to a wave of foreclosures. And recent data showing foreclosure filings have increased is only feeding into this fear. But don’t let that scare you.
If you put the latest data into context, it’s clear there’s no reason to think this is a repeat of the last housing crash.
This Isn’t Like 2008
While it’s true that foreclosure filings ticked up in the latest quarterly report from ATTOM, they’re still lower than the norm – and way below levels seen during the crash. And it’s a lot easier to see if you graph that out.
If you compare Q1 2025 (on the right side of the graph) to what happened in the years surrounding the 2008 crash (shown in red), it’s clear the market is in a completely different place (see graph below):
Back then, risky lending practices left homeowners with mortgages they couldn’t afford. That led to a wave of foreclosures, which flooded the market with distressed properties, a surplus of inventory, and caused home prices to drop dramatically.
Today, lending standards are much stronger, and most homeowners are in a much better financial position. That’s why filings are so much lower this time.
And just in case you’re looking at 2020 and 2021 (click "Learn More" to finish the article)...
