Back at the start of 2023, with mortgage rates having just spiked and the market cooling off fast, I got the same question constantly: are we about to see a foreclosure tsunami like 2008? My answer then, built on data from ATTOM and commentary from ATTOM’s Rick Sharga, was no. The reasoning: today’s homeowners are better qualified, carry far more equity, and builders never overbuilt the way they did before the Great Recession. I also predicted mortgage rates would ease into the 5% range and that Montgomery County would stay a seller’s market, just a calmer one. Looking back now, that forecast held up well. There was no foreclosure wave, distressed homeowners mostly sold their way out with equity intact, and our local market cooled without cratering. Here’s the full breakdown of what I said, why I said it, and how it actually played out.
Why did people think a foreclosure tsunami was coming in 2023?
The fear made sense on the surface. Rates had jumped fast in 2022, home values dipped in the back half of the year, and anyone who lived through 2008 had that panic wired into them. But the underlying data never supported a repeat. Loan quality had been the real driver of the last crash, not just rising rates, and that piece of the puzzle looked completely different this time around.
What did the data actually show back then?
ATTOM Data, which has tracked foreclosure activity since 1996, and Rick Sharga specifically, laid out three reasons 2023 wasn’t going to look like 2008. First, mortgage lending had tightened up dramatically over the prior 15 years. Loans were fully documented, buyers put more money down, and most were locked into historically low fixed rates. Second, roughly 93% of homeowners in foreclosure at that point had positive equity, the exact opposite of 2008, when a third of homeowners owed more than their homes were worth. Third, builders had pulled way back on new construction. The Great Recession crash was made worse by a 13-month national inventory glut from overbuilding between 2005 and 2007. None of that existed heading into 2023.
Did we see a wave of bank repossessions?
No, and that was the key detail people missed. Sharga’s data showed foreclosure starts ticking up slightly, but very few of those turned into actual bank repossessions. Instead, distressed owners were executing what he called a soft landing: selling before the auction, often at a profit, and moving on. That’s a completely different outcome than mass foreclosure inventory flooding the market, and it’s exactly what played out.
Where did mortgage rates end up?
Sharga predicted rates had likely peaked in October 2022 and would ease into the 5% range as the Fed got inflation under control. Rates didn’t drop as fast or as far as that 2023 forecast suggested, they stayed higher for longer, but the broader point held: the Fed did slow its pace of hikes, and the runaway spiral some feared never materialized. The bigger story turned out to be the “lock-in effect,” which leads right into the next point.
Why didn’t home prices crater like they did during the Great Recession?
Because supply stayed tight even as demand cooled. Sharga pointed to a combination of low inventory and steady demographic demand as the floor under home prices. The factor I kept hammering on in my own videos was rate lock-in: roughly 70% of U.S. homeowners had rates below 4%, and very few of them were willing to trade that for a 6%+ rate just to move. That kept listings scarce, which kept prices supported even as the market normalized. Builders also stayed cautious rather than flooding the market again, unlike the mid-2000s.
How did this actually play out in Montgomery County?
Locally, I was even more bullish than the national forecast, and that held up. Early 2023 already showed more showings, busier open houses, and bidding wars returning, just at a saner scale. In 2022 it wasn’t unusual to see 10 or 20 offers on a single home. By early 2023, most competitive listings were drawing one to three offers instead, which is a healthy, sustainable market rather than a frenzy. A seller only needs one good offer, and Montgomery County kept producing them.
What does this 2023 case study tell us about the market today?
The lesson isn’t the specific rate or offer numbers, it’s the framework. When you separate emotional headlines from actual data like ATTOM’s foreclosure tracking and NAR’s research, you get a much clearer read on where the market is headed. Equity levels, loan quality, builder behavior, and inventory are the real signals to watch, not fear-driven comparisons to 2008. That approach is exactly why I check current numbers on mystats pagebefore making any prediction, and it’s the same framework I use whether you’re buying, selling, or watching the market from the sidelines.
If you’re thinking about your next move in Montgomery County, start with myguide to buying a homeor reach out directly through mycontact page.
FAQ
Did Montgomery County see a wave of foreclosures after 2023?
No. Foreclosure starts ticked up slightly nationally, but the vast majority of distressed owners sold before auction with equity intact rather than losing homes to bank repossession, both nationally and locally.
Why was 2023 so different from the 2008 housing crash?
Better-qualified borrowers, far higher homeowner equity levels, and much more disciplined home building. The 2008 crash was fueled by loose lending and a massive oversupply of new construction, neither of which existed in 2023.
Did mortgage rates drop to 5% like predicted in 2023?
Not immediately. Rates stayed elevated longer than that early 2023 forecast expected, though the aggressive Fed hiking cycle did slow down as predicted.
What kept home prices from falling sharply in 2023?
Tight inventory. With about 70% of homeowners locked into rates under 4%, very few were willing to sell and take on a much higher rate, which kept listings scarce and prices supported.
Where can I check current Montgomery County market data?
Mystats pagehas updated local numbers, and you can always cross-reference national trends through sources likeATTOM DataandNAR Research.
Looking back, the 2023 forecast was right about the fundamentals: no crash, a soft landing for distressed owners, and a Montgomery County market that cooled without collapsing. If you want a straight read on where things stand today instead of headline panic, let’s talk.
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Sources and next steps
Verified local sources:Maryland REALTORS housing statistics;GCAAR housing market reports;FRED 30-year mortgage rate series;Maryland SDAT real property search.
Related Kevin guides:market stats;relocation guide;book a call.
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Expanded local research sources:GCAAR housing market reports;Maryland REALTORS housing statistics;Realtor.com Montgomery County market data;FRED 30-year mortgage rates;Maryland SDAT real property search;Zillow Montgomery County home values;Montgomery Planning development;Montgomery Planning development review;MCATLAS zoning map;Montgomery Planning data catalog;Montgomery County permits;Visit Montgomery travel guide;Visit Montgomery restaurant directory;Tripadvisor Montgomery County things to do.
Contextual links for this video
Kevin site links:home selling guide;home buying guide;market stats;DMV Housing Market 2026: Is a Crash Coming or Are the Numbers Telling a Different Story?;Zillow Just Banned Private Listings — Here’s What Home Buyers and Sellers Actually Need to Know.
Outside research links for this video:GCAAR housing market reports;Maryland REALTORS housing stats;Realtor.com Montgomery County market data;Reddit discussion search for this topic;Google context search for this video.
Kevin process link: why Kevin’s local process matters.