Foreclosures Hit the Rich Also

Five years after the housing bubble burst, America’s wealthiest families are now losing their homes to foreclosure at a faster rate than the rest of the country — and many of them are doing so voluntarily.

Over 36,000 homes valued at $1 million or more were foreclosed on — or at least served with a notice of default — in 2011, according to data compiled by RealtyTrac, which tracks foreclosures. While that’s less than 2% of all foreclosures nationwide, it represents a much bigger share of foreclosure activity than in previous years.

“These properties are accounting for a bigger piece of the foreclosure pie,” said Daren Blomquist, vice president of RealtyTrac.
Out of all foreclosure activity, the share of foreclosures on properties valued at $1 million or more has risen by 115% since 2007 while the share of multi-million dollar foreclosures — or homes valued at more than $2 million — jumped by 273%. Meanwhile, the share of foreclosures on mid-range properties valued between $500,000 and $1 million fell by 21%.

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