Mortgage interest rates are increasing, home prices have appreciated to new levels and affordability is getting harder and harder for people to achieve. Along with that, many people are asking if the market is a buble and will it burst? Many would be investors or first-time home buyers are asking me if there are going to be foreclosures on the market. Let’s answer the question, Where are all of the foreclosures in the 2022 housing market.
First of all, there is not a housing bubble. We’ve seen incredibly high demand for homes which is driving up the prices and the government has to increase interest rates to slow down inflation. Neither of those things will directly cause a real estate market to crash. Many people are looking back at 2008 & 2009 when we had a market crash. That market crash of 2009 and resulting recession was caused by mortgage lenders giving loans to everyone who applied. There were no standards and many people who did not qualify for the homes they bought obviously got in trouble.
The current lending restrictions of 2022 are much more difficult. The people who own homes now have proven their credit worthiness and income. They will not default on their mortgage payment at the levels we say in 2009.
Secondly, home owners have a lot of equity. Even home owners who bought homes only 1 or 2 years ago might have $100,000 in equity. So, if they lose a job and fall behind on mortgage payments, they will still be able to sell their home for a big profit. They will obvioulsy sell their home instead of going through foreclosure.
And lastly, the real estate market is still a very hot sellers market. There is very high demand for homes and few homes currently for sale. That means that someone who is struggling to make their mortgage payment due to a hardship, could place their home on the market and sell in within 30 days. There would be no need for a foreclosure process and for the banks to sell the home at a discount.

For all of the above reasons, I do not expect to see a surge of foreclosures. If you’ve been asking where to find foreclosures in this market, I wouldn’t expect to see any foreclosures any time soon. The market is shifting with higher mortgage interest rates but demand to buy a home is so strong that prices and home values will stay strong.
If you have questions about the Northern Colorado Real Estate Market, reach out to me directly by phone or text: 970-203-5066.
Andy Hawbaker is a licensed Realtor with 8z Real Estate in Northern Colorado.
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