2023 Q3 Foreclosure Report: NYC Foreclosures Increase 44% Year-Over-Year, Brooklyn Cases Surge 185% 

Key Takeaways:

• NYC first-time foreclosures rise 44% year-over-year, total 427 cases in Q3 
• Brooklyn registers the highest number of foreclosures, rising 185% year-over-year  
• Lis pendens increase 35% quarter-over-quarter, with filings trending upward in four out of five boroughs  
• The Bronx registers a staggering 1990% increase in pre-foreclosures quarter-over-quarter 
• Only Manhattan and Staten Island record a drop in first-time foreclosures quarter-over-quarter, down 23% and 36%, respectively 
• Queens’ Elmhurst closes Q3 as the city’s foreclosure epicenter with 36 filings 

The New York City residential foreclosure market continues to be in flux, influenced by factors such as the lifting of COVID-19 moratoriums, rising interest rates, shifting housing demand, and their collective impact on homeowners citywide. 

At the citywide level, the PropertyShark analysis reveals an 18% increase in foreclosure cases in Q3 2023 compared to the previous quarter, with 427 cases recorded as opposed to 361 in Q2 2023. Year-over-year, the upward trend is even more pronounced, indicating a 44% rise. Nonetheless, NYC foreclosures remained below pre-pandemic levels, when first-time residential foreclosures reached 688 cases in Q1 2020.  

Brooklyn stood out with an 85% increase over the previous quarter. Specifically, Brooklyn registered 168 foreclosure cases in Q3 2023, a substantial jump from the 91 recorded in Q2 2023. This borough also led year-over-year growth, with a significant 185% uptick in cases. Quarter-over-quarter, two out of five boroughs experienced a decrease in first-time foreclosures, with filings falling 23% in Manhattan and 36% in Staten Island. 

Apart from foreclosures, we also analyzed residential lis pendens. In the third quarter of 2023, pre-foreclosure filings in NYC rose by 17% year-over-year and 35% compared to the previous quarter.  The Bronx stood out with a staggering 1990% increase in pre-foreclosures, from 10 lis pendens in Q2 2023 to 209 in Q3 2023. Brooklyn also saw a substantial increase in lis pendens filings, up 158% over the previous quarter. Overall, among the five boroughs, only Staten Island had a decline in this category, falling 63%.   

Brooklyn Records Largest Increase in Foreclosures, up 185% Year-Over-Year 

Brooklyn led the five boroughs in terms of first-time residential foreclosures with 168 unique cases in Q3 2023, representing a 185% uptick from the 59 filings during the same time frame in 2022 and an 85% surge from the 91 foreclosures in the previous quarter. The last time Brooklyn recorded a similar number of filings in one quarter was in Q1 2020 (162 filings), before the moratorium imposed due to the COVID-19 pandemic.  

The Brooklyn epicenter of first-time foreclosures was zip 11234, with 22 filings recorded in Q3. The zip includes Marine Park, Flatlands, Old Mill Basin, Mill Basin, Bergen Beach and Georgetown neighborhoods.  

As has been the case since mid-2019, Brooklyn continued to see the highest number of lis pendens filings, totaling 645 cases in the third quarter of this year. From Q2 to Q3, pre-foreclosures in Brooklyn increased by 158%, after a 59% drop recorded from Q1 to Q2. Residential lis pendens in the borough also increased on a year-over-year basis, rising 5%. 

Manhattan Foreclosures Fall 23% Quarter-Over-Quarter, Rise 147% Year-Over-Year 

Manhattan recorded 37 first-time foreclosures in the third quarter of 2023, down 23 percent from the 48 seen in the previous quarter. On a year-over-year basis, however, foreclosures in the borough surged 147%, up from 15 filings in the third quarter of 2022. Last year, Manhattan saw 63 foreclosures, whereas first-time foreclosures reached 122 cases in the first three quarters of 2023 alone. 

The highest number of new foreclosures in Manhattan was recorded in zip 10128 in Carnegie Hill and Yorkville, with four new filings in Q3. 

While foreclosure filings trended downwards in Manhattan, lis pendens increased 81% quarter-over-quarter, from 54 to 98. But, compared to Q3 in 2022, pre-foreclosures were down by 4%. Indeed, while lis pendens in 2022 were more in line with pre-pandemic levels, pre-foreclosures this year trended downwards. Manhattan logged the fewest number of cases, significantly below the 204 cases in Staten Island — the second-lowest number of lis pendens in the city.  

Queens Registers Second-Highest Foreclosure Total in Q3 2023 

Queens remained one of the most active foreclosure markets in New York City, with 167 first-time filings in Q3 2023, up 11% year-over-year, representing a gain of 17 first-time filings. For the first time since the moratorium ended at the beginning of 2022, foreclosures in Queens were slightly outpaced by Brooklyn, where 168 filings were recorded in Q3 this year. 

Quarter-over-quarter, Queens foreclosure filings increased by 13% from the 148 filings in Q2. Foreclosures in Queens were concentrated in zip 11373, encompassing Elmhurst in Central Queens, where 36 foreclosures were recorded. Moreover, there were 12 unique filings in zip 11413 in Springfield Gardens and 11 in zip 11433, encompassing the neighborhood of Jamaica. 

In terms of pre-foreclosures, Queens marked an 8% year-over-year increase, from 248 cases in Q3 2022 to 269 cases in Q3 this year. However, the number of lis pendens filings remained significantly lower than pre-COVID-19 levels, when filings hovered between 700 and 1000 cases per quarter. The number of lis pendens filed in Queens was surpassed by only the 645 filed in Brooklyn. 

Lis Pendens in the Bronx Jump from 10 Filings in Q2 to 209 in Q3 

Of all five boroughs, the Bronx experienced the third sharpest increase in first-time foreclosures. In the third quarter of 2023, there were 20 first-time foreclosures here — up 82% over the third quarter in 2022. It’s important to note that, in terms of actual case numbers, that percentage gain represented an increase from 11 cases in Q3 2022 to 20 Cases in Q3 2023. 

Meanwhile, on a quarter-over-year basis, foreclosure filings increased 5%, from 19 in Q2. This means residential foreclosures stayed well below pre-pandemic levels when filings hovered between 60 to 150 cases per quarter. 

While foreclosures remained muted in the Bronx, lis pendens surged 294% year-over-year, from 53 filings in Q3 2022 to 209 in Q3 2023. From the previous quarter, the increase is even sharper, up from 10 pre-foreclosure cases, representing a 1990% change. The last time the Bronx recorded over 200 pre-foreclosure cases was in Q4 2019, when 239 filings were registered. 

Staten Island Foreclosures and Lis Pendens Trend Downward Quarter-Over-Quarter and Year-Over-Year 

In the third quarter of 2023, Staten Island was the only New York City borough to record drops in both first-time foreclosures and lis pendens filings quarter-over-quarter and annually as well.  

Foreclosure filings decreased 44% year-over-year in Q3, from 62 cases last year to 35 in 2023. At the same time, foreclosure cases also fell 36% from the 55 occurrences in Q2 this year. Although pre-foreclosure filings saw a slight 100 basis points fall on a year-over-year basis, on a quarterly basis, cases dropped 63%, from 544 in Q2 to 204 in Q3.  

With 11 unique cases, Staten Island’s foreclosure hotspot was zip code 10314, encompassing the neighborhood of Mid-Island. The area saw the most foreclosure filings in the borough so far this year, with a total of 28 cases recorded.  

Methodology

Having tracked foreclosure listings for more than a decade, PropertyShark is the only service in New York that guarantees 100% coverage of the local foreclosure market. Because auctions are frequently postponed and/or rescheduled, the statistics referenced in this report include only first-time foreclosures in order to avoid over-reporting the number of distressed properties in the city.

Separately, we also report on lis pendens (pre-foreclosure) filings, which are legal notices that mark the beginning of the foreclosure process.

This report focuses exclusively on residential properties (single and two-family homes; condos; and co-op units) that were scheduled for auction for the first time in Q3 2023.

Pre-foreclosure data refers to unique properties that had at least one lis pendens filing in Q3 2023, which may be a first-time filing or a refiling. The same building class restrictions apply, excluding co-ops. If more than three units were referenced on the same lis pendens filing, they w