SInce May, there were 2,525 Illinois residences in foreclosure, a 3.6 percent increase from April. Still, Illinois’ numbers are better than they were a year ago.

Illinois has the nation’s highest percentage of housing units in foreclosure.

One in every 2,144 Illinois residences was in foreclosure proceedings for May, according to the most recent data from ATTOM, a property data provider.

In May, there were 2,525 Illinois residences in foreclosure, a 3.6 percent increase from April, according to ATTOM. Despite having the nation’s highest percentage of homes in foreclosure, Illinois’ numbers are better than they were a year ago. Illinois’ May numbers are a 6.9 percent drop from May 2022.

Five counties in the Chronicle Media coverage area – St. Clair, DeKalb, Peoria, McLean and Madison – all saw double-digit increases in foreclosure activity in May as compared with May 2022. St. Clair had 115 residences in foreclosure in May, an 89 percent increase from a year ago.

ATTOM CEO Rob Barber said the five counties’ double-digit increases in foreclosures should get local officials’ attention.

“There should be heightened concern whenever a foreclosure activity rate increases that much in just one year,” Barber said. “If the pattern continues, it could be a sign of significant trouble in any given local housing market.

“At that same time, though, the rates are still very low. They range from 1 in 3,547 (McLean) to 1 in 1,001 (St. Clair). In most neighborhoods in those counties, you’d be hard-pressed to find more than one or two homes in foreclosure. That’s way less than during the bad old days after the Great Recession of the late 2000s when far more homeowners lost their homes to foreclosure, and many more neighborhoods were pockmarked with vacant, blight-inducing foreclosed properties. So there is reason for concern, but not alarm.”

Barber said several things could be factoring into keeping Illinois’ foreclosure activity rate at number 1, a distinction it also held in May 2022. He said home-price declines, relatively low homeowner equity, and residual effects of high unemployment during the early stages of the Coronavirus pandemic could all be playing into the mix.

“Our data shows that Illinois had the second-highest level of mortgage homeowners with no equity built up in their properties – 12.8 percent – in the first quarter of 2023,” the ATTOM CEO said. “That means that 1 of every 8 homeowners in the state who were paying off a mortgage were underwater on their loans, second only to Louisiana (1 in 6). Nationwide, just 6.2 percent of mortgaged homes had no equity built up in the first quarter.

“In addition, Illinois had the third-highest portion of mortgaged homeowners who were seriously underwater in the first quarter of this year, owing at least 25 percent more than the estimated value of their properties. Some 6.4 percent of Illinois mortgage payers (1 in 16) were in that predicament, compared with 3 percent nationwide.”

Barber said at the same time, data shows that the median home price in Illinois fell 11 percent from the second quarter of 2022, when the national market boom started to stall, to the first quarter of this year, falling from $247,000 to $220,000.

“With homeowner equity relatively low, and price decreases further cutting into that, it makes sense that foreclosure activity would be higher in Illinois,” he added.

Barber said another factor in the mix could be the unemployment spike in the state early in the pandemic, which hit almost 18 percent in April 2020, according to federal data.

“The state has come a long way since then, with the April 2023 rate at just 3.7 percent,” he said, “but there could be a significant chunk of homeowners who never recovered enough from job losses a few years ago to get back up to date on their mortgages.”

Twenty-eight communities in the Chronicle Media coverage area saw at least 100 percent increases in foreclosure activity from May 2022 to May 2023.

• Clair County: Caseyville, 800 percent; Millstadt, 200 percent; and Dupo and Mascoutah, 100 percent
• DeKalb County: DeKalb, 600 percent
• Lake County: Lake Forest, 400 percent; and Island Lake and Lake Bluff 100 percent
• Kane County: Geneva, 300 percent
• DuPage County: Villa Park, 300 percent; Elmhurst and Willowbrook, 200 percent; and Glen Ellyn and Lemont, 100 percent
• Madison County: Wood River, 300 percent; Bethalo, 200 percent; Collinsville, 110 percent; and Highland and Maryville, 100 percent
• Kendall County: Minooka, 200 percent
• Cook County: Morton Grove, 200 percent; Wilmette and Palos Hills, 150 percent; and Hillside and Lemont, 100 percent
• McHenry County: Lake in the Hills, 150 percent; Wonder Lake, 118 percent; and Island Lake, 100 percent
• Peoria County: Glasford, 100 percent
• Winnebago County: South Beloit, 100 percent

ATTOM’s Barber said that it is not time for emergency action, but state and local leaders should keep foreclosures on their radar.

“It is true that Illinois does have the highest residential foreclosure activity rate among all states nationwide, at 1 in every 2,144 homes,” he said. “That’s worse than the ratio of 1 in every 2,713 a year ago, when the state also had the highest activity rate in the country.

“But that’s still very low, leaving most neighborhoods with none or almost no properties facing possible foreclosure. Even for the five counties (in the Chronicle coverage area with double-digit increases), the rates remain small. It’s certainly something to keep an eye on, but it shouldn’t raise alarm bells – at least not yet.”