ATTOM's Q1 2026 analysis shows unemployment and foreclosure rates are pushing key US counties toward the edge
Mortgage lenders and brokers operating in Florida and California are facing the sharpest concentration of county-level housing market risk in the country, according to ATTOM's first-quarter 2026 Housing Risk Report.
The analysis, covering 580 counties nationwide, ranked each market across four metrics: foreclosure rate, share of seriously underwater mortgages, affordability relative to local wages, and unemployment.
Twelve Florida counties and nine California counties appeared among the 50 most vulnerable, with Illinois and New Jersey contributing five each.
The five riskiest individual markets were Charlotte County, FL; Butte County, CA; Charles County, MD; Shasta County, CA; and Cumberland County, NJ.
Rob Barber, CEO of ATTOM, pointed to labor market conditions as the defining variable. "While home prices have eased slightly from last summer's record highs, affordability remains a challenge in much of the country," Barber said.
"The greatest risk remains in counties where unemployment rates are above 5% and homes are being foreclosed at greater rates."
At the national level, the median home sales price reached $360,000 in Q1 2026. That's a figure that would consume 30.3% of the typical American worker's annual wages in major monthly ownership costs.
Affordability stress was most acute in coastal markets: Kings County, NY, topped the list, with ownership expenses equivalent to 108.6% of the typical resident's wages, followed by Santa Cruz County, CA (97.1%), Marin County, CA (91.1%), San Luis Obispo County, CA (89.7%), and Orange County, CA (88.1%).
Patricia Ammann of Redfin says many sellers are struggling to adjust to a market where buyers have greater negotiating power, while Lawrence Yun of the National Association of Realtors notes that buyers are taking longer to make purchasing decisions.https://t.co/pX1xMaMWMo
— Mortgage Professional America Magazine (@MPAMagazineUS) June 5, 2026
The underwater mortgage picture
Nationally, 3.2% of homes were considered seriously underwater in Q1 2026, meaning outstanding loan balances exceeded estimated market values by at least 25%.
Louisiana dominated this category: Ouachita Parish led at 17.4%, followed by Calcasieu Parish (17.1%), Tangipahoa Parish (15%), Ascension Parish (14.5%), and Rapides Parish (13.2%).
On the foreclosure side, one in every 1,211 homes nationally was in the foreclosure process during the quarter.
Liberty County, TX, recorded the highest concentration at one in every 55 homes. Baltimore City, MD (1 in 294), Dorchester County, SC (1 in 352), Kaufman County, TX (1 in 361), and Pueblo County, CO (1 in 368) followed.
As ATTOM has previously reported, foreclosure activity has been climbing steadily since the start of 2026, following more than a year of consecutive year-over-year increases in filings.
Tennessee leads the least risky markets
At the other end of ATTOM's rankings, Tennessee claimed nine of the 50 safest counties, with Virginia and Wisconsin contributing five each and Michigan four.
Chittenden County, VT; Rutherford County, TN; Arlington County, VA; Tippecanoe County, IN; and Cumberland County, ME ranked as the five least risky markets overall.
These counties shared a consistent profile: unemployment and foreclosure rates well below the national average, and modest underwater mortgage exposure.
Odeta Kushi, deputy chief economist at First American, offered context in earlier commentary, noting that a foreclosure wave would require both job loss and equity erosion simultaneously, a scenario she said had not yet materialized at scale.
High unemployment in California counties was another driver of elevated risk scores. Imperial County, CA, recorded the highest rate among all 580 analyzed counties at 17.6%, followed by Yuma County, AZ (11.7%), Tulare County, CA (11.5%), Merced County, CA (10.9%), and Monterey County, CA (10.8%).
Released Friday by the Bureau of Labor Statistics (BLS), the employment report held the unemployment rate steady at 4.3%.
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