While the percentage of “zombie” properties across the country has declined slightly, the rates in a handful of Midwest cities come in much higher than the national average, according to a new report.
Zombie property is a term used to describe a home that was abandoned by its owners before foreclosure proceedings were finalised. In some cases, the foreclosures are never completed and homes not repossessed by the lender, meaning the house remains in the name of an absentee owner.
Among homes in the foreclosure process, 3.3 per cent were vacant and abandoned by their owners in the third quarter, according to recent report from Attom, a provider of property data and AI-powered analytics.
The plague of zombie properties is the highest in a few Midwest metropolitan areas. Attom analysed 140 cities with at least 100,000 residential properties and at least 50 properties in the foreclosure process. The cities with the highest zombie rates were Youngstown, OH, in which 12.1 per cent of homes in foreclosure were vacant; Cedar Rapids, IA, with 11.6 per cent; Baltimore, MD, with 11.5 per cent; Fort Wayne, IN, with 11.1 per cent; and Akron, OH, with 10.5 per cent.
“A zombie property is created by a gap between two events that people assume happen together but often don’t. An owner gets a notice of default, believes the bank now owns the house, and moves out,” John Carter, founder of NestCash, tells Realtor.com. “But the lender never actually completes the foreclosure, sometimes because the property is worth less than the cost of foreclosing, taking title, and maintaining it.”
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Zombie properties are prevalent in some US cities. Photo: Getty Images
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Because of the vacancy and lacking upkeep, these zombie properties can become dilapidated eyesores for their neighbours while continuing to accrue taxes under the owner’s name.
The Attom report shows that 1.3 per cent of residential properties in the U.S. were vacant in the third quarter of 2026. This number is consistent with the previous quarter as well as the third quarter of 2025.
There are 104.6 million residential properties in the United States and, in the third quarter of 2026, 259,666 of them were in the foreclosure process. Roughly 3.3 per cent of those, or 8,482, had been abandoned by their owners, making them zombies, shows Attom’s Vacant Property and Zombie Foreclosure Report.
This number is a slight decrease from the 3.4 per cent reported in both the previous quarter and third quarter of 2025.
Zooming out, the states with the largest quarter-over-quarter increases in zombie properties were Kentucky, Colorado, Maryland, Arizona, and Indiana.
The lowest zombie rates were found in Bridgeport, CT, and Huntsville, AL, both with 0 per cent; Trenton, NJ, with 0.1 per cent; Provo, UT, with 0.2 per cent; and Atlantic City, NJ, with 0.4 per cent, according to ATTOM
The states with the largest decline in zombie properties were Georgia, Texas, Ohio, Minnesota, and California.
Roughly 3.3 per cent of homes in the foreclosure process in quarter three of 2026 were abandoned by their owners, making them zombies. Photo: Getty Images
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Zombie properties can wreak havoc on their neighbourhoods, causing substantial damage to home values in areas where they are common.
“An abandoned house drags down everything around it. It suppresses neighbouring home values, invites vandalism and squatting, becomes a fire and safety hazard, and signals decline that can pull a whole block down with it,” Carter explains.
While the abandoned properties can have major negative impacts, they also offer great opportunities for buyers with a certain skill set. The homes generally sell well below market value due to the amount of work required to become liveable again. Despite attractive prices, they aren’t the right homes for a first-time buyer using traditional financing. For an experienced home flipper, however, these homes can be hidden gems.
“The ideal buyers would be investors who have a lot of cash. You require money at your disposal to cover any hidden title problems, unrecorded municipal code liens, and delinquent property taxes,” realtor Greg Field tells Realtor.com. “When you understand the scopes of work and title clearances, it would be possible to make good profits. But when looking for the turnkey starter home, stay away.”
In order to prevent having a zombie property on your hands, Carter recommends staying in your home until the title officially changes hands. Some owners pack their bags as soon as they receive a notice of default, despite the foreclosure process often taking months or even years to complete. During the length of the process, owners can seek other paths for their home.
“A default notice is the start of a process, not the end of your ownership. As long as you hold title, you have options, including reinstatement, a loan modification, a short sale, or an outright cash sale that pays off the loan and hands the problem to someone equipped to deal with it,” says Carter. “The owners who end up creating zombie properties are almost always the ones who abandoned the house early on a mistaken belief they no longer owned it.”