Commercial foreclosures increase 97% from last year to near decade-high

Commercial foreclosures increase 97% from last year to near decade-high

Commercial real estate foreclosures in the U.S. increased 97% in January 2024 compared to last year, reaching a high that has not been seen in nearly a decade, according to new data.

With 635 commercial foreclosures in January 2024, foreclosures increased 17% from December 2023 and 97% from January 2023, according to a report last week from property data analyst ATTOM.

The last time that commercial foreclosures were this high was in May 2015, per agency data

"This uptick signifies not just a return to pre-pandemic activity levels but also underscores the ongoing adjustments within the commercial real estate sector as it navigates through a landscape transformed by evolving business practices and consumer behaviors," ATTOM CEO Rob Barber said.

Commercial real estate foreclosure is highest since 2015.​

data source:
U.S. Commercial Foreclosures Increase in January 2024 | ATTOM


I think we really have to ask ourselves what this says about the U.S. economy.

I know the media keeps saying there has been a switch to remote work outside the office space, but I think that it is only a smaller part of what is really going on.

Think about how they keep building more and more high-density multi-unit homes, track homes squeezed right next to each other with no yard space.
But at the same time we have not really seen more commercial buildings being built.
It sounds to me like the population keeps going up but these people don't have money.

What I suspect is many businesses simply cannot afford to have office space. That ranges all the way from medium-large businesses to smaller one-person professional practices.


related threads:
Beginnings of default on debt in U.S. economy (October 2023) (Oct 21, 2023)
How the 'urban doom loop' could pose the next economic threat (by Lil Mike, Aug 29, 2023)

 

Sounds like an urban problem to me. My rural area is doing just fine, thank you.

 

You are aware that the majority of the country's population lives in more urban areas.

And you are dead wrong if you think you don't need to worry because it's just "happening somewhere else".
These problems likely WILL reach your area, in one way or another, in the not too far off distant future.
It's a sign of something that's happening in the society and economy, even if you don't see anything happening in your area yet. One thing that could happen, maybe people will start pouring out of other areas and flooding into your region, and eventually bring their problems with them. That's just one example of the type of thing that could happen.

You might also want to think about how this could affect your retirement plan. (Yes, the economy is interconnected like that)

 

My retirement is already bought and paid for. I'm a Gen X'er working in the oilfield making upwards of 180k a year. I plan ahead, unlike the current generation that whines about having to work a "whopping" 40 hours a week.