Based on home affordability, equity, and other metrics, ATTOM’s most recent Housing Risk Report highlights U.S. county-level housing markets that are more or less susceptible to falls in Q2 of 2025. Many of the counties with the highest and lowest risk were found in the South, according to the survey.
Four in Louisiana, seven in Florida, five in New Jersey, and fourteen in California were among the 50 markets with the highest risk. Affordability, the percentage of mortgages that were significantly underwater, foreclosures, and county unemployment rates were used to calculate risk.
Home prices reached all-time highs in Q2, but as of June, mortgage rates, salaries, and unemployment rates had all remained relatively stable, adding to the financial strain on homeowners in many cities. Residents would have needed to pay at least half of their yearly salaries to buy and maintain a home in 19% (111) of the 579 counties having enough data for analysis. Residents would have had to spend at least one-third of their yearly income on household expenses in almost 63% of the counties.
“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.”
Based on factors like the percentage of homes at risk of foreclosure, the percentage of seriously underwater mortgages, the percentage of average local wages needed to cover significant home ownership costs on median-priced single-family homes, and local unemployment rates, counties were deemed to be more or less at risk.
According to ATTOM’s data, the most dangerous counties have both comparatively high unemployment and foreclosure rates. Regular readers of this post will be familiar with a number of them, especially California counties that have been severely affected by wildfires in recent years.
The riskiest counties were:
- Charlotte County, FL
- Humboldt County, CA
- Shasta County, CA
- Butte County, CA
- Cumberland County, NJ
All five of these counties had unemployment rates higher than the June non-seasonally adjusted national average of 4.36 percent, despite differences in the median house sales price and home affordability metrics. Additionally, each of them had a foreclosure ratio of at least one out of every 766 residences in the county.
In Q2 of 2025, the average homeowner nationwide spent slightly more than a third (33.7%) of their yearly salary on mortgage payments, down payments, and other expenses. However, expenses were far greater in some regions, sometimes surpassing what an average worker could afford with a full year’s salary.
Additional Key Findings — National
- In Marin County, CA, home expenses consumed 119.7% of the typical resident’s annual wages
- Santa Cruz County, CA, expenses consumed 116.1% of typical annual wages
- In Maui County, Hawaii, expenses consumed 111.5% of typical annual wages
- Kings County, NY, expenses consumed 109% of typical annual wages
- San Luis Obispo County, CA, expenses consumed 99.3% of typical annual wages
An estimated 2.7% of homes nationwide were deemed to be seriously underwater, which means that the total estimated balance of the loans secured by the properties exceeded their projected market values by at least 25%. Approximately 39% (223) of the 579 counties in ATTOM’s survey had higher rates of residences that were significantly underwater. Further, Louisiana accounted for seven of the 10 counties with the greatest underwater rates.
The top five were:
- Rapides Parish, LA (17.3% of homes seriously underwater)
- Calcasieu Parish, LA (16.9%)
- Caddo Parish, LA (14.3%)
- Tangipahoa Parish, LA (14.1%)
- East Baton Rouge Parish, LA (12.1%)
In Q2 of 2025, around one out of every 1,413 residences in the nation was subject to a foreclosure action.
The counties with the highest foreclosure rates were:
- Dorchester County, SC (one in every 355 homes facing foreclosure)
- Charlotte County, FL (one in every 372 homes)
- Oswego County, NY (one in every 427 homes)
- Kaufman County, TX (one in every 467 homes)
- Lake County, IN (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:
- Imperial County, CA (19%)
- Yuma County, AZ (15.2%)
- Tulare County, CA (10.8%)
- Merced County, CA (10.5%)
- Kings County, CA (9.8%)
Among the 50 most dangerous counties as well as the 50 least dangerous counties, the South has some of the highest representation. There were eighteen counties in the South and eighteen in the Northeast that were the most advantageous, or least dangerous. With eight, New York had the most, followed by Wisconsin with seven, Tennessee with four, and New Hampshire with four.
The South accounted for 21 of the 50 most dangerous counties in ATTOM’s analysis, while the West had 18.
In Q2 of 2025, purchasing and maintaining a home would have cost more than a third of the average resident’s annualized salary in 34 of the 50 least risky markets and 40 of the 50 riskiest markets, indicating that high home costs are impacting all types of housing markets.
Among the 50 least risky counties, those with the smallest share of wages needed to cover home costs were:
- Chautauqua County, NY (17.8%)
- Potter County, Texas (19.6%)
- Erie County, NY (22.6%)
- Madison County, AL (25.8%)
- Olmsted County, MN (27.5%)
All but six of those 50 most advantageous counties had far lower rates of underwater homes than the 2.7% national average.
The counties with the lowest rates of seriously underwater homes were:
- Chittenden County, VT (0.5%)
- Washington County, RI (0.7%)
- Fairfax County, VA (0.9%)
- Hillsborough County, NH (0.9%)
- Rockingham County, NY (1.0%)
The national foreclosure rate of one in every 1,413 residences was exceeded by only two of the top 50 counties.
The top counties with the best foreclosure rates were:
- Chittenden County, VT (one in every 37,013 homes)
- Orange County, NC (one in every 15,532 homes)
- Yellowstone County, MT (one in every 14,673 homes)
- Dane County, WI (one in every 11,082 homes)
- Berkeley County, WV (one in every 10,502 homes)
In June, the unemployment rate in none of the top 50 counties was higher than the 4.4% national average.
Increasing financial strain on American homes was evident in Q2 of 2025, with affordability issues continuing despite stable national pay and employment statistics. Due to a combination of high foreclosure rates, underwater mortgages, and high unemployment, Southern and Western counties dominated the list of the most vulnerable housing markets.
While numerous counties in the Northeast and Midwest shown relative stability, California and Florida continued to rank among the most dangerous regions. The analysis emphasizes how localized economic strains continue to expose some communities to increased housing risk even in the face of record home prices.
“There’s uncertainty about how long prices can keep going up, and what will happen with the broader economy,” Barber said. “That can be scary for owners and prospective buyers who don’t always get a full view of their market.”
Note: 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.
The post Study Reveals Most At-Risk Housing Markets Amid Rising Mortgage Activity first appeared on The MortgagePoint.
