Now seems like a good time to discuss where we are with foreclosures. Actually, the legally correct term is Trustee Sales, but people who have not been through Real Estate School are more familiar with the term foreclosures.
The chart above shows monthly foreclosures from January 2002 to May 2026. It is only for Maricopa County and includes only residential properties. The red line shows Notices of Trustee Sale, which initiate foreclosure under Arizona law. The blue line shows Trustee Deeds, which complete a foreclosure that has not been cancelled. Both lines use a logarithmic scale for the y-axis. Some of you may not be familiar with this scale, but it is quite useful because it prevents very large numbers from swamping the chart. Normal charts usually use linear axes, but logarithmic axes have the following advantages:
- Each step on the scale represents a tenfold increase rather than a fixed amount. So the gap between 10 and 100 is the same visual distance as the gap between 100 and 1,000.
- Large numbers are compressed and small numbers amplified, which helps us to spot trends and judge where a change is significant.
We can see the huge increase in foreclosure activity from 2006 to 2008, which gave us a clear warning about the crash that culminated in Lehman Brothers filing for bankruptcy in September 2008. After peaking in 2009, a long, slow decline followed until COVID hit in 2020. The consequent moratorium reduced numbers dramatically in 2020 (although it did not eliminate them). After the moratorium was lifted, foreclosures have returned to the same level they were before COVID, namely:
- about 400 to 500 notices per month
- about 100 to 150 trustee deeds (completed foreclosures)
- about 300 notices that get cancelled every month
Pessimists can point to the significant percentage increase between 2024 and 2026 and claim that we are in trouble. This is unfounded clickbait, and you can find content providers all over YouTube and elsewhere, trying to scare people and push up their view counts. If we use the 2004 numbers as a good guide as to what is normal for foreclosures in Maricopa County, we see:
- about 1,000 notices per month
- about 400 trustee deeds
We are still about 50% BELOW normal, and although the trend is moving up, it is doing so quite slowly and consistent with things getting back to normal over a 5-year timeframe. We should also remember that the population of homeowners is significantly higher now than it was in 2004. We estimate that the overall population in Maricopa County has grown from 3.5 million to 4.7 million in those 22 years. This gives us a significant buffer before we need to start getting concerned.
In summary, foreclosures are not a significant concern at the moment for the market as a whole, and you can safely stop spending your valuable time getting alarmed about them unless and until we post a message telling you to start worrying again.
If you see videos on YouTube claiming that foreclosures are exploding, please don’t click on them. You would just be encouraging their nonsense.