Commercial foreclosures increased 48% in September compared to the same month last year. According to the ATTOM report, there were 695 foreclosures nationwide. That’s slightly lower than when commercial foreclosures peaked earlier this year, but up 15% month-over-month, according to the report.
“Since June 2023, the number of foreclosures has increased rapidly, peaking at 752 in May 2024, but has stabilized at 695 in ATTOM’s latest data for September 2024. This recent spike “This suggests new financial stress and changes in commercial real estate trends.” The company said in a note this week.
California saw the largest year-over-year increase in commercial foreclosures, with commercial building foreclosures jumping 238% from the same period last year. In New York state, the number of foreclosures increased by 48% compared to the previous year, and in Florida, the number of foreclosures increased by 49% compared to the previous year.
Commercial mortgage delinquency rates also rose slightly in the third quarter, with the percentage of loans that were 60 to 90 days late rising to 0.3% and the percentage of loans that were at least 90 days late rising to 2.7%, the company said. Mortgage Bankers Association. On the other hand, the balance of loans with arrears of less than 30 days decreased slightly, but remained at a high level of 96.8%.
Real estate experts are warning of further hardship for commercial real estate, especially the office sector. Demand for two-story office buildings has declined since the pandemic, and some are predicting a wave of forced sales and defaults as debt continues to mature in the sector.
Meanwhile, other, more optimistic forecasts predict a recovery in the commercial real estate market. According to Moody’s analysis, trading in the sector has already bottomed out, with sales volumes increasing in September for the first time in two years.
