What 1.4 Million Vacant Homes Signal About the U.S. Housing Market in 2025

A new report from ATTOM sheds light on the state of residential vacancies and zombie foreclosures in the U.S., revealing both stability and underlying concerns in today’s housing market. According to data from Q2 2025, roughly 1.4 million homes or about 1.3% of all residential properties are currently vacant. It’s a figure that has remained largely unchanged for more than three years.

But while vacancy rates are steady, some shifts are taking place in the foreclosure landscape and in the distribution of empty homes, with certain states and metro areas showing troubling trends.

Foreclosures Tick Up—But Zombie Properties Stay Low

ATTOM’s analysis found that 222,358 properties were in the foreclosure process during the second quarter of 2025 a 4.8% increase from Q1, but 6.3% lower compared to this time last year. This ends a five-quarter streak of declining foreclosure activity.

Of those homes in pre-foreclosure, 7,329 properties (3.3%) were classified as “zombie” homes vacant properties abandoned by owners during the foreclosure process. While that’s a slight increase from last year’s 2.9%, the rate has remained largely flat since the start of 2025.

Zombie homes, often left to deteriorate, can drag down neighborhood property values and raise concerns about community safety. However, the current rate about one in every 14,000 homes nationwide is historically low, suggesting a housing market that is far healthier than during the 2008 financial crisis.

“We’re not seeing widespread abandonment like we did in the past,” said Rob Barber, CEO of ATTOM. “That’s a strong sign for homeowners, communities, and the market overall.”

Buyers Are Absorbing Foreclosed Homes Quickly

Although zombie properties have increased in 30 states and the District of Columbia, the changes have been relatively modest. In many areas, these homes are being purchased and occupied before they can sit empty for long.

Barber notes that while April saw a 14% jump in foreclosure filings year-over-year, the absorption rate for distressed homes remains high. “It’s a very different market than 2008,” he explained. “We’re not seeing large-scale abandonment or neglect.”

Where Are Zombie Homes Increasing the Most?

Among states with at least 50 zombie properties, North Carolina led with a 52.5% increase in zombie homes year-over-year. Other notable jumps include:

• Iowa – up 52.1%
• Texas – up 51.9%
• South Carolina – up 43.8%
• Kansas – up 29%

Meanwhile, several states saw meaningful declines in zombie foreclosure activity:

• Massachusetts – down 48.7%
• Maryland – down 22.1%
• New Jersey – down 17.6%
• California – down 8.9%
• Illinois – down 8.8%

Vacancy Rates Highest in Southern States

The nationwide vacancy rate has held steady at 1.3% for 13 consecutive quarters, but some states are seeing much higher levels of empty housing:

• Oklahoma – 2.4%
• Kansas – 2.3%
• Alabama – 2.2%
• Missouri – 2.2%
• West Virginia – 2.1%

By contrast, the states with the lowest vacancy rates include:

• New Hampshire – 0.3%
• Vermont – 0.4%
• New Jersey – 0.5%
• Idaho – 0.5%
• Connecticut – 0.5%

Most Major Metro Areas Below National Zombie Rate

More than half of large metropolitan areas tracked in the study 76 out of 138 reported zombie foreclosure rates below the national average of 3.3%.

Among the metros with the highest percentage of zombie homes in foreclosure were:

• Wichita, Kansas – 12.1%
• Peoria, Illinois – 11.8%
• Toledo, Ohio – 10.2%
• Cedar Rapids, Iowa – 10.2%
• Cleveland, Ohio – 10%

On the other end of the spectrum, these areas had the lowest rates of zombie foreclosures:

• Barnstable, Massachusetts – 0%
• Atlantic City, New Jersey – 0.2%
• Provo, Utah – 0.3%
• Trenton, New Jersey – 0.5%
• Stockton, California – 0.6%

Investor-Owned and Bank-Owned Homes Have Higher Vacancy Rates

ATTOM’s report also highlights a notable difference in vacancy rates between owner-occupied and investor-owned properties. Among the 24.8 million investor-owned properties analyzed, the national vacancy rate was 3.5% far above the overall 1.3% figure.

States with the highest investor-related vacancy rates include:

• Indiana – 7.3%
• Illinois – 6.2%
• Alabama – 6.0%
• Oklahoma – 6.0%
• Ohio – 5.8%

Those with the lowest rates include:

• New Hampshire – 0.9%
• Vermont – 1.0%
• Idaho – 1.2%
• Utah – 1.5%
• North Dakota – 1.6%

Zombie Home Hotspots at the ZIP Code Level

In Q2 2025, 36% of ZIP codes with at least 25 homes in pre-foreclosure had zombie foreclosure rates above the national average. However, 42% of ZIP codes reported no zombie properties at all.

Some of the highest zombie foreclosure rates by ZIP code were found in:

• 61605 (Peoria, IL) – 51.9%
• 44108 (Cleveland, OH) – 42.2%
• 61603 (Peoria, IL) – 34.6%
• 32118 (Deltona, FL) – 34.2%
• 33708 (Tampa, FL) – 33.3%

Final Thoughts: What the Data Means

Despite headlines about rising foreclosures, the broader data shows that vacant homes and zombie foreclosures remain relatively rare. The U.S. housing market bolstered by resilient demand, steady occupancy rates, and active buyers is holding firm.

Still, areas with rising vacancies or growing foreclosure rates warrant close attention, especially as affordability challenges continue and interest rates remain high.

The good news? For now, widespread blight or economic distress appears unlikely but as market conditions evolve, keeping an eye on zombie properties remains a key signal for housing health. Visit Nadlan Capital Group for more information.