Rising Tide of Zombie Properties
In a troubling sign for the US housing market, the number of zombie homes—vacant properties abandoned by owners during the foreclosure process—has increased in 30 states and the District of Columbia during the second quarter of 2025. According to a statement released on May 29 by real estate data analytics company ATTOM, these properties are often left in disrepair, dragging down the value of neighboring homes and signaling broader economic distress.
Particularly hard-hit states include North Carolina, Iowa, and Texas, where the number of zombie properties has jumped over 50 percent on an annual basis. Among states with at least 50 zombie homes, North Carolina recorded the largest year-over-year percentage increase at 52.5 percent, highlighting the severity of the issue in specific regions.
Impact on Communities and Housing Market
The proliferation of zombie homes poses significant challenges for local communities. These abandoned properties often become eyesores, with overgrown lawns and deteriorating structures that can attract crime and further depress property values. As ATTOM's data indicates, the presence of such homes is a clear indicator of distress not just in individual households but in the wider housing market and economy.
In areas like Peoria County, Illinois, which has been identified as having the highest zombie foreclosure rate in the nation, the impact is even more pronounced. Posts found on X reflect public concern, with users noting how these vacant homes 'drop neighborhood value—and attract no one,' underscoring the urgency for solutions to address this growing problem.
While the overall share of vacant residential properties across the US has remained steady at about 1.3 percent—or roughly 1.4 million properties—for the 13th consecutive quarter, the specific rise in zombie foreclosures suggests targeted areas of concern that could ripple outward if left unchecked.
Looking Ahead: Challenges and Potential Solutions
The increase in zombie properties, with over 7,300 homes sitting empty during foreclosure in Q2 2025, raises questions about how policymakers and local governments will respond. States like North Carolina, Texas, and Iowa, which have seen jumps of over 50 percent, may need to consider targeted interventions to prevent further deterioration of affected neighborhoods.
Real estate experts suggest that addressing zombie homes could involve streamlining the foreclosure process to reduce the time properties remain in legal limbo, as well as incentivizing rehabilitation or resale of these homes. As the housing market continues to grapple with these challenges, the data from ATTOM serves as a critical reminder of the underlying issues facing many American communities in 2025.