According to ATTOM’s latest Housing Risk Report, a study spotlighting county-level housing markets around the nation that are vulnerable to declines—based on home affordability, equity, and other measures in Q2 of 2025—many of the highest and lowest risk counties were located in the South.
Of the 50 highest risk markets, 14 of them were found in California, seven in Florida, five in New Jersey, and four in Louisiana. Risk was determined by affordability, proportion of seriously underwater mortgages, foreclosures, and county unemployment rates. The financial pressures continued to grow on homeowners in many markets in Q2, with home prices rising to record highs while, as of June, mortgage rates, wages, and unemployment rates had largely held steady.
In 19% (111) of the 579 counties with sufficient data to analyze, residents would have had to spend at least half of their annualized wages to purchase and maintain a home. In about 63% of the counties, residents would have had to spend at least a third of their annual wages on home expenses.
“This summer’s home prices were certainly eye-catching, but there are many factors that contribute to the health of a local housing market,” said Rob Barber, CEO of ATTOM. “Our index takes into account key indicators beyond just sales price to create a barometer that helps folks better understand where their market is headed. There’s uncertainty about how long prices can keep going up, and what will happen with the broader economy. That can be scary for owners and prospective buyers who don’t always get a full view of their market.”
Counties were considered more or less at risk based on the percentage of homes facing possible foreclosure, the portion with seriously underwater mortgages, the percentage of average local wages required to pay for major home ownership expenses on median-priced single-family homes, and local unemployment rates.
The conclusions were drawn from an analysis of the most recent home affordability, equity and foreclosure reports prepared by ATTOM. Unemployment rates came from federal government data. Rankings were based on a combination of those four categories in 579 counties around the United States with sufficient data to analyze in the second quarter of 2025. Counties were ranked in each category, from lowest to highest, with the overall conclusion based on a combination of the four ranks.
Foreclosures, Unemployment Drive Trends
The riskiest counties in ATTOM’s analysis were characterized by a combination of relatively high foreclosure and unemployment rates. Several of them, particularly California counties that have been hit hard by wildfires in recent years, will be familiar to regular readers of this report.
The riskiest counties were:
- Charlotte County, Florida
- Humboldt County, California
- Shasta County, California
- Butte County, California
- Cumberland County, New Jersey
While the median home sales price and home affordability measures varied between these counties, all five reported unemployment rates above June’s non-seasonally adjusted national average of 4.36%. They also all had ratios of at least one in every 766 homes in the county in foreclosure.
Cost of Living on the Rise
Nationwide, placing a downpayment on a home, paying a mortgage, and covering other expenses cost the typical owner 33.7% of their annualized wages in Q2 of 2025. But in some counties, costs were higher and even exceeded what a typical worker could cover with a full year’s pay.
In Marin County, California, home expenses consumed 119.7% of the typical resident’s annual wages, followed by:
- Santa Cruz County, California where expenses consumed 116.1% of typical annual wages
- Maui County Hawaii, where expenses consumed 111.5% of typical annual wages
- Kings County, New York, where expenses consumed 109% of typical annual wages
- San Luis Obispo County, California, where expenses consumed 99.3% of typical annual wages
Nationally, 2.7% of homes were considered seriously underwater, meaning the combined estimated balance of loans secured by the properties were at least 25% more than the properties’ estimated market values. Of the 579 counties in ATTOM’s analysis, about 39 percent (223) had higher rates of seriously underwater homes.
Seven out of the 10 counties with the highest underwater rates were found in Louisiana, led by:
- Rapides Parish, Louisiana (17.3% of homes seriously underwater)
- Calcasieu Parish, Louisiana (16.9% of homes seriously underwater)
- Caddo Parish, Louisiana (14.3% of homes seriously underwater)
- Tangipahoa Parish, Louisiana (14.1% of homes seriously underwater)
- East Baton Rouge Parish, Louisiana (12.1% of homes seriously underwater)
Foreclosure Rates Trending Upward in Q2
Nearly one in every 1,413 homes in the country faced a foreclosure action during Q2 of 2025. The counties with the highest foreclosure rates included:
- Dorchester County, South Carolina (one in every 355 homes facing foreclosure)
- Charlotte County, Florida (one in every 372 homes)
- Oswego County, New York (one in every 427 homes)
- Kaufman County, Texas (one in every 467 homes)
- Lake County, Indiana (one in every 488 homes)
About 35% (204) of the counties in ATTOM’s analysis had June unemployment rates higher than the national rate of 4.4%. The counties with the highest unemployment rates were found in:
- Imperial County, California (19%)
- Yuma County, Arizona (15.2%)
- Tulare County, California (10.8%)
- Merced County, California (10.5%)
- Kings County, California (9.8%)
Southern Counties at the Extremes
The South was well-represented among both the 50 least risky counties and the 50 most risky counties. Of the most favorable, or least risky counties, 18 were in the South and 18 were in the Northeast. New York had the most, with eight, followed by Wisconsin, with seven, and New Hampshire and Tennessee, with four each.
Of the 50 riskiest counties in ATTOM’s analysis, 21 were spread across the South, followed by the West, with 18. California had the most, with 14; followed by Florida, with seven; New Jersey, with five; and Louisiana, with four.
Healthiest Counties Balanced by Low Unemployment and Low Foreclosure Rates
In a sign that high home costs are impacting all kinds of housing markets, in Q2 of 2025, buying and maintaining a home would have cost more than a third of the typical resident’s annualized wages in 34 out of the 50 least risky markets and 40 out of the 50 riskiest markets.
Among the 50 least risky counties, those with the smallest share of wages needed to cover home costs were found in:
- Chautauqua County, New York (17.8%)
- Potter County, Texas (19.6%)
- Erie County, New York (22.6%)
- Madison County, Alabama (25.8%)
- Olmsted County, Minnesota (27.5%)
Of those 50 most favorable counties, all but six had seriously underwater home rates better than the national rate of 2.7%. The counties with the lowest rates of seriously underwater homes were reported in:
- Chittenden County, Vermont (0.5%)
- Washington County, Rhode Island (0.7%)
- Fairfax County, Virginia (0.9%)
- Hillsborough County, New Hampshire (0.9%)
- Rockingham County, New York (1.0%)
Only two of the top 50 counties had foreclosure ratios worse than the national ratio of one in every 1,413 homes facing foreclosure. The top counties with the best foreclosure rates were:
- Chittenden County, Vermont (one in every 37,013 homes)
- Orange County, North Carolina (one in every 15,532 homes)
- Yellowstone County, Montana (one in every 14,673 homes)
- Dane County, Wisconsin (one in every 11,082 homes)
- Berkeley County, West Virginia (one in every 10,502 homes)
None of the top 50 counties had unemployment rates above the national rate of 4.4% in June. The top counties with the best unemployment rates were found in:
- Cumberland County, Maine (2.2%)
- Chittenden County, Vermont (2.3%)
- Shelby County, Alabama (2.4%)
- Gallatin County, Montana (2.4%)
- Saratoga County, New York (2.5%)
Q2 revealed intensifying financial pressure on U.S. homeowners, with affordability challenges persisting even as national wage and employment figures held steady. Southern and Western counties dominated the list of most vulnerable housing markets, driven by a combination of high foreclosure rates, underwater mortgages, and elevated unemployment. California and Florida remained prominent among the riskiest areas, while several counties in the Northeast and Midwest showed relative stability. The report underscores how, despite record home prices, localized economic stressors continue to expose certain markets to heightened housing risk.
Click here for more on ATTOM’s Q2 Home Risk Report.
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