Brooklyn Foreclosures More Than Doubled Last Year

The number of Brooklyn homeowners at serious risk of losing their homes through foreclosure more than doubled from 2022 to 2023, with 541 homes being the subject of first-time foreclosure auctions last year compared to 180 in 2022.

The borough saw a 66 percent increase in foreclosures year over year, the largest citywide, with the majority of the auctions scheduled in the last two quarters of 2023, a PropertyShark report shows. Brooklyn also had the city’s “foreclosure epicenter,” the area with the most foreclosures. ZIP code 11220, covering parts of Bay Ridge, Dyker Heights, and Sunset Park, logged 68 foreclosures, 54 of which were in the same building at 702 44th Street.

The six-story, 54-unit building on the corner of 44th Street and 7th Avenue was left uninhabitable after a fire broke out in 2019. A December report in The City said the occupants of the building, a mix of owners and tenants, have been unable to reenter their homes and the building’s future is uncertain.

Image via PropertyShark

Overall, Brooklyn accounted for 30 percent of the city’s 1,620 foreclosures, the first time the number has climbed to four digits since 2019. Despite the increase, the number of homeowners at risk of foreclosure is still significantly less than in 2019, when 3,060 foreclosure auctions were scheduled.

And while Brooklyn saw a big increase in foreclosure auctions, it also saw a 17 percent drop in pre-foreclosure filings – the largest in any borough – at 1,943 compared to 2022’s 2,327. The dip comes as mortgage interest rates have declined since October last year, after near constant increases over the past couple of years. The interest rates are still far above those in 2021.

Across the city, Queens saw the most foreclosures filed in 2023, with 631 cases. On the other hand, the Bronx saw the least foreclosures filed, with 82 (5 percent of the city’s total).

bay ridge - brick houses

Bay Ridge. Photo by Susan De Vries

The report, which looks at single- and two-family homes, condos, and co-ops, predicts foreclosure rates are still nowhere near reaching the amounts seen before the pandemic, given the “muted growth in lis pendens filings.” Citywide, pre-foreclosure cases numbered 4,935 in 2023 compared to 9,185 in 2019.

It takes years for a lis pendens to result in a foreclosure auction in New York City, and many homes in Brooklyn still have active foreclosure cases stemming from subprime loans issued before the 2008 crash.

Areas in Brooklyn that have historically had heavy amounts of lis pendens and foreclosures, such as central Brooklyn, are also areas where predatory lending and deed fraud are common, and that were formerly redlined.

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