Rising foreclosures and \u201cparticularly high rates of unemployment\u201d characterized county-level housing markets most vulnerable to economic shocks in the first quarter.<\/p>\n
More than 60% of the 50 most vulnerable U.S. counties were concentrated in just four states<\/a>, according to real estate analytics firm Attom, updating its Housing Risk Report for the first quarter on Thursday.<\/p>\n Florida claimed 12 of those riskiest markets, followed by California, which contained nine. Illinois and New Jersey each accounted for five, stated the Attom report, which evaluates counties for being \u201cmore or less vulnerable to declines\u201d based on home affordability, home equity levels, and foreclosure and unemployment rates.<\/p>\n Topping the list for riskiest counties as it did in the fourth quarter was Charlotte County, Fla., just north of the city of Cape Coral. Butte County, Calif., the epicenter of the devastating 2018 Camp Fire, moved into second from third in the fourth quarter, followed by Charles County, Md., which had been second but dropped down to third.<\/p>\n Rob Barber, CEO of Attom, commented in the report that despite softening home price trends<\/a>, housing affordability remains challenging \u201cin much of the country.\u201d<\/p>\n \u201cThe greatest risk remains in counties where unemployment rates are above 5% and homes are being foreclosed at greater rates,\u201d said Barber. One out of every 1,211 homes across the U.S. was in the process of foreclosure during the first three months of 2026.<\/p>\n Softening and declining home prices in some markets across the U.S. have contributed to gradual increase in the share of homes considered seriously underwater, or properties secured by loan balances exceeding the property\u2019s estimated market value by at least 25%.<\/p>\n Rising from 2.8% in the third quarter of last year to 3% in the fourth quarter, Attom says that 3.2% of home nationwide were seriously underwater in the first quarter of 2026.<\/p>\n