Q1 Foreclosure Filings Hit 13-Year High Amid Widening Real Estate Polarization

The number of new foreclosure applications filed with courts in the first quarter of this year reached 30,541. This marks the largest volume for a first quarter since Q1 2013 (30,939), and the highest figure in 13 years.

As of April, the number of residential properties undergoing foreclosure was 12,426, the highest since 2006. Non-apartment properties accounted for 72.2% of these. Commercial and office property foreclosures totaled 8,252, the highest since statistical records began. As of May, industrial property foreclosures, including factories, stand at 1,222, an all-time high.

This increase in foreclosed properties is a delayed reflection of the economic slowdown that has accumulated since the COVID-19 pandemic, coupled with the burden of interest rate hikes that began in the latter half of 2021. The real estate market is showing a trend of deepening polarization due to high interest rates and loan restrictions. Amid an overall market contraction, demand is increasingly concentrating on apartments in a few preferred areas.