Report highlights risks driven by affordability and economic disparities
California, New Jersey, and Illinois continue to lead as the most at-risk states for housing market vulnerabilities, according to the latest Special Housing Market Impact Risk Report from ATTOM.
The report, analyzing data from the third quarter of 2024, revealed how affordability challenges, equity concerns, foreclosure rates, and unemployment levels are driving market disparities across the country.
While California holds the highest number of counties identified as at-risk, regions in Florida, Illinois, and New Jersey have also emerged as potential trouble spots, with Florida showing new signs of vulnerability after remaining relatively stable in earlier quarters.
Of the 50 counties most vulnerable to market downturns, two-thirds are concentrated in California, Florida, Illinois, and New Jersey. California alone accounted for 13 counties, primarily in inland areas, while Illinois saw six counties near Chicago flagged as at-risk. In New Jersey, southern regions led the list, and five counties near New York City were also highlighted.
Florida’s entry into the high-risk category reflected evolving conditions, particularly in areas where rising costs and economic shifts have affected affordability and equity.
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On the opposite end of the spectrum, several counties in Virginia, Wisconsin, Tennessee, Montana, and New Hampshire were identified as least vulnerable. These regions generally benefit from lower foreclosure rates, healthier unemployment figures, and more sustainable affordability levels. Four counties in the Washington, DC area were also noted for their resilience.
Rob Barber, CEO of ATTOM, noted that the report highlighted areas more or less able to withstand changes in market conditions but doesn’t predict imminent declines.
“The recent market risk patterns changed a bit in the third quarter, with some new areas making the list of places more or less exposed to downfalls. But the big picture remained pretty much the same,” Barber explained.
"The recent market risk patterns changed a bit in the third quarter, with some new areas making the list of places more or less exposed to downfalls," he said. “But the big picture remained pretty much the same around the country as differences in important metrics helped produce varying pockets of vulnerability.
"As with past reports, this one is not meant to suggest any given area is about to fall or is immune from problems. Rather, it spotlights locations that look to be more or less able to withstand significant changes in market conditions. We will continue to keep a close watch on markets throughout the country to see how things track."
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