These Housing Markets are Most at Risk of Decline

High mortgage rates and lack of supply have done their damage to the housing markets, which only recently saw price growth start to regain momentum. Not surprisingly, some markets are at greater risk of decline than others, according to ATTOM, which recently took a look at the most- and least-risk averse markets in a recent study.

Let’s look first at the most-at-risk markets in the country, which include a percentage of homes facing foreclosure, a portion with mortgage balances that exceed estimated property values, a percentage of average local wages required to pay for home ownership costs on single-family homes and also local unemployment rates.

New Jersey and Illinois fall into the most at-risk categories with the biggest clusters in the New York City, Chicago and Philadelphia areas. New Jersey and Illinois had 23 of the 50 counties most vulnerable to potential drop-offs.

Overall, the 50 counties at the top of the list included eight in and around New York City, six in the Chicago metropolitan area and three in or near Philadelphia. Another six were scattered through northern, central and southern California. Most of the rest were in Indiana and along the East Coast. 

Now, let’s consider which areas are less exposed to risk? The South and other parts of the Northeast, including two New England states, ranked as having the highest concentration of markets considered least likely to decline. Specifically, 18 of the 51 counties were in the South with six in Virginia and five in the Washington, D.C., metro area. Massachusetts has five of these markets. Only 11 were in the Midwest and five in the West.

Digger deeper, the specific top 10 least at-risk housing market declines include Chittenden County, Vt.; Benton County, Ark.; Fairfax County, Va; Prince William County, Va; Shelby County, Ala.; Cass County, N.D.; Middlesex County, Mass.; Brown County, Wis.; Rutherford County, Tenn.; and Sarpy County, Neb.