Home Foreclosures Soar Nationwide—These 2 States Are Hit the Hardest 

A growing number of U.S. homeowners are losing their properties because they cannot keep up with mortgage payments—with some states seeing drastically higher default rates than others.

In July, nearly 36,130 properties nationwide were hit with a foreclosure filing, up 13% from a year ago, and the steepest annual increase so far this year, according to the latest report from real estate data analytics firm ATTOM.

Put another way, 1 in every 3,939 housing units in the U.S. saw foreclosure activity last month, including default notices, scheduled auctions, and bank repossessions.

“July’s foreclosure activity continues to trend upward year over year, with increases in both starts and completions,” says Rob Barber, CEO of ATTOM. “While rising home prices are helping many owners maintain equity, the steady climb in filings suggests growing pressure in some markets.”

For context, 187,659 homes received a foreclosure filing during the first six months of the year, up 5.8% compared with the same period in 2024, signaling a growing financial distress among homeowners.

In a bit of good news, July saw the number of foreclosure completions—meaning property repossessions—tick down 1% from June, with 3,866 housing units being transferred from defaulted homeowners to lenders.

On an annual basis, however, foreclosure completions increased 18% in July compared with a year ago.

States seeing the most foreclosures

Nevada earned the distinction of leading the nation in foreclosure rates last month, with 1 in every 2,326 residential properties in the Silver State facing a default.

Florida clinched the unenviable No. 2 spot with a foreclosure filing rate of 1 in every 2,420 housing units, followed by Maryland (1 in every 2,566), South Carolina (1 in every 2,588), and Illinois (1 in every 2,727).

Nevada’s June rate was just slightly lower than July’s, at 1 in every 2,615 housing units facing foreclosure. That month, South Carolina topped the list of states with the most delinquencies, while Nevada came in second and Florida third.

So why are Nevada and Florida experiencing such a sharp rise in foreclosures this summer?

Realtor.com® senior economist Joel Berner says the surge in defaults in those states is closely tied to tourism.

“Florida and Nevada both have local economies that are heavily reliant on the tourism industry,” explains Berner. “Tourism tends to be volatile, and when economic growth slows as it has this year, that industry is often the first and most painfully impacted. Some homeowners in these states may be losing their jobs and becoming unable to make their mortgage payments.”

Las Vegas’ foreclosure rate rises as listings surge

In Nevada, tourism is closely linked with the state’s gambling industry, which pumps billions of dollars annually into the state’s economy. But the latest available data shows that casinos have not been earning as much money as in the past.

The Nevada Gaming Control Board‘s 2024 fiscal year report revealed a record $31.5 billion in revenue overall, but net income dropped 24.4%.

The total revenue is defined as all the money spent by patrons on gambling, rooms, food, beverage, and other attractions. Net income is what casinos make after expenses have been paid, but before subtracting federal income taxes and accounting for extraordinary expenses.

Las Vegas, Nevada’s most populous city and the state’s key economic hub, notched the nation’s third-highest foreclosure rate among the top metros, at 1 in every 1,914 housing units.

At the same time, homes in Sin City have been piling up on the market this summer, fueled by an exodus of retirees and real estate investors.

In both June and July, the city recorded the biggest annual inventory growth among the top 50 U.S. metros, at 77.6% and 65.7%, respectively.

According to Berner, this spike in listings in Las Vegas could be both a cause and a consequence of rising foreclosure rates.

“As inventory grows without additional demand for homes, home values fall and homeowners’ mortgages become ‘underwater,’ meaning that they owe more on their home than it is worth,” says the economist. “These homeowners are often struggling to make their mortgage payment, and now that even selling the home can’t get them out of debt, many end up defaulting instead.”

Additionally, Las Vegas saw a record number of luxury homes priced at $1 million and higher hitting the market in July.

Listings in that segment surged 42% compared with last year, according to the Realtor.com July 2025 housing data.

Tania Jhayem, a real estate agent and investment specialist with Urban Nest in Las Vegas, tells Realtor.com that the situation in Nevada is not as alarming as the ATTOM report might suggest.

“A foreclosure filing is simply the first step in a process that can take seven months or longer, and many filings never actually result in a sale,” she points out. Also, the state’s foreclosure process is “faster and more transparent” than elsewhere, so filings show up in national rankings sooner.

“Other states may have far more distressed homeowners, but because their timelines are longer, it’s not reflected in the same monthly data,” she says.

Jhayem notes that Southern Nevada currently has just 63 foreclosure listings—less than 1% of roughly 6,500 for-sale homes.

“Even if all sold tomorrow, prices and inventory would not be affected,” she says.

Looking at July and August figures, the agent says that sales in Nevada have increased, as did the inventory, while price cuts edged down, suggesting that sellers have not had to resort to discounts to attract buyers.

“This data reinforces the fact that Nevada’s high national foreclosure ranking reflects our faster, more transparent process, rather than any sign of widespread homeowner distress,” says Jhayem.

The real estate professional says she has an overall positive outlook on the future of Nevada’s housing market, especially in light of the Federal Reserve’s widely anticipated rate cut in September.

“This isn’t 2008,” says Jhayem. “We’re well-positioned to keep inventory healthy, help more buyers enter the market, and give sellers, including those facing challenges, a better chance to sell their homes, realize their equity, and avoid foreclosure.”

Sunshine State struggles with defaults

In Florida, the state’s housing market has been through a rough year, with sellers struggling to offload their properties due to waning demand and facing high foreclosure rates.

According to the ATTOM report, the Sunshine State had the second-highest number of foreclosure starts, which typically involves a notice of default, at 2,891, and the third-highest number of foreclosure completions, at 241.

Among the 110 metros with a population of at least 500,000, three Florida cities stood out for having some of the nation’s worst foreclosure rates: Cape Coral (1 in every 1,735 housing units), Lakeland (1 in every 1,802), and Deltona (1 in every 1,818).

Looking at major metros with a population over 1 million, Jacksonville, FL, had 1 in every 1,893 properties face a default in July, trailing only Houston (1 in every 1,882).

Berner says foreclosure activity in the U.S. as a whole could be elevated due to expectations from buyers in recent years that mortgage rates would come down significantly and they would be able to refinance their mortgage payments to a more affordable amount.

“Instead, mortgage rates have remained elevated and recent homebuyers’ budgets have remained stretched thin,” he adds. “The adage ‘marry the home, date the rate’ is an enticing proposition for buyers in a high mortgage rate environment, but when rates don’t come down, the gamble doesn’t pay off.”