'Zombie' home foreclosures tick up nationwide. Here's how Arizona is different

By Angela Gonzales

The number of zombie foreclosures — the phrase adopted to describe abandoned pre-foreclosure homes — are slowly inching upward across the country, according to a third quarter report by ATTOM.

Zombie foreclosures now represent 3.38% of all U.S. residential properties in foreclosure as of July, up slightly from Q2 and the same period a year ago.

ATTOM's Q3 2025 Vacant Property and Zombie Foreclosure report shows 1.39 million U.S. homes, or 1.3%, are currently vacant — a rate that has stayed consistent for more than three years despite high housing demand.

Seven of the states in ATTOM's top 10 are judicial foreclosure states, which means there's a long process that banks have to go through within the judicial system in order to foreclose on a property, which can cause a backlog of pending foreclosures in the system, said Tina Tamboer, senior housing analyst for The Cromford Report.

Arizona, however, is not a judicial foreclosure state. Instead, it has a 90-day nonjudicial process that swiftly moves the home from pre-foreclosure to auction/foreclosure, according to Tambour.

Nonetheless, the state saw 787 foreclosure filings among 3.14 million housing units in Arizona in July, with Pinal, Mohave and Cochise counties impacted the most, according to the ATTOM report.

"I believe they're counting notices of trustee sale and not completed foreclosures," Tamboer said. "Maricopa County had 393 filings of trustee sale — about 50% of 787‚ but this number is not rising and is still considered very low for the size of the county."

Home foreclosures in Maricopa County reach 131 in July

Tamboer said only 131 cases went all the way to a completed foreclosure in Maricopa County during July, even though that number was up sharply from 35 in the same month in 2024.

"That's a very small number historically," Tamboer said. "It was a sharp increase, but not an alarming one. I had more people in my college Spanish class. This is not crisis material."

Indeed, the number of foreclosures today are a tiny fraction of what happened in Arizona during the Great Recession, when the Phoenix recorded 10,558 homes in pre-foreclosure in March 2009, she said.

Today, most of the foreclosures in the Valley are investors who bought homes in 2022 and don't have enough equity in the properties, Tamboer said.

"The reality is, we're not seeing the beginnings of another foreclosure crisis," she said.

ATTOM ranked Arizona No. 16 in states with the highest foreclosure activity in July.

Home values surged dramatically during the post-Covid boom, generating substantial equity for most Arizona homeowners, said Greg Hague, CEO of Scottsdale-based 72Sold.

"That cushions many against foreclosure," Hague said. "If any financial trouble arises, they can reduce the price and sell to a retail buyer rather than lose the home at auction."

At the same time, this equity has emboldened some sellers, he said.

"Nationally the number of homes delisted — pulled off the market because owners didn't get their price — rose nearly 50% from June 2024 to June 2025," Hague said. "Florida led the nation in delistings, with Arizona ranking second."

Final Thoughts:

While “zombie” foreclosures are creeping up across the U.S., Arizona tells a different story. Thanks to its faster, nonjudicial foreclosure process and the strong equity most homeowners built during the post-COVID housing boom, the state has avoided the type of backlog and crisis seen in judicial foreclosure states.

Yes, Maricopa County foreclosure completions have increased compared to last year, but the numbers are still historically low and nowhere near the Great Recession levels. Most current foreclosures involve investors who purchased homes at the market’s peak, not families losing long-time residences.