Palisades Foreclosures Have Increased — But Still Represent Just 0.3% of Properties
More than 20 months after the Palisades fire, I continue to track foreclosure activity in Pacific Palisades. The latest numbers show an increase worth watching, but they still do not indicate anything approaching the foreclosure wave many feared after the fire.
As of September 23, there are 26 properties in some stage of foreclosure: 13 in pre-foreclosure or Notice of Default, five scheduled for auction or trustee sale, and eight bank-owned.
When I began tracking this in June 2025, there were 15 properties. Today's 26 represent an increase of approximately 73%. While that sounds significant, perspective is important. Pacific Palisades has roughly 9,000 residential properties, so the 26 currently in some stage of foreclosure represent only about 0.3% of the community—about three out of every 1,000 properties.
The graphic above shows both the longer-term increase and the relative stability we've seen since March 2026. Source: RealtyTrac and other public-record foreclosure sources.
Not every property identified as being in the foreclosure process will ultimately be foreclosed upon.
A Notice of Default (NOD), or pre-foreclosure, is generally the first formal stage. It means a borrower has fallen behind and the lender has begun foreclosure. The owner may still bring the loan current, refinance, sell the property or work something out with the lender.
If the default isn't resolved, a Notice of Trustee's Sale can be recorded, and the property can be scheduled for auction. Even then, a sale can sometimes be postponed or canceled if the situation is resolved.
If the property ultimately goes through foreclosure and no third party purchases it at auction, the lender may take title. It then becomes REO, or bank-owned, and the lender can market the property for sale.
So when we say 26 properties are in some stage of foreclosure, that does not mean 26 Palisades homeowners have lost their homes.
For much of 2026, foreclosure activity has been remarkably stable. From March through September, the total has remained within a narrow range of 23 to 26 properties.
That matters because focusing only on the 73% increase from June 2025 could make the trend look more dramatic than it has been recently. Foreclosure activity increased substantially in the latter half of 2025 and early 2026, but it has essentially plateaued over the past seven months.
Movement across the three categories is also worth watching. Since August, pre-foreclosures increased from 11 to 13, and bank-owned properties increased from seven to eight, while auctions actually declined from seven to five.
Another important point: these are 26 active properties in the foreclosure pipeline, not 26 new foreclosures this month. Some of the same properties have appeared on the list for months and simply move from one stage to another.
The current properties are also spread throughout the Palisades and across a wide range of property values. This does not appear to be an issue isolated to one neighborhood or price range.
Against the backdrop of the extraordinary financial disruption following the fire, including rebuilding costs, insurance delays, displacement, and carrying costs, the fact that the number remains this small more than 20 months later is notable. We also don't know that the fire caused any particular homeowner's financial distress.
Historical perspective is particularly helpful.
RealtyTrac data cited by the City of Los Angeles showed about 169 foreclosure-related properties/events in ZIP code 90272 during 2011, after the last major housing crash.
The historical and current figures aren't perfectly apples-to-apples, so I wouldn't make a direct statistical comparison between 169 then and 26 today. But the 2011 experience provides useful context for what a substantially more distressed Palisades housing market looked like.
Based on that history, I'd become significantly more concerned if the number approached about 100 properties.
That's not an official economic threshold. It's simply a benchmark I use based on what the Palisades experienced during the last significant housing downturn.
We're at 26 today.
The number I'll be watching most closely is new Notices of Default.
A significant increase in NODs would suggest that substantially more homeowners are beginning to experience financial distress. An increase in auctions or bank-owned properties without a corresponding increase in NODs could instead mean older cases are simply progressing through the foreclosure process.
No foreclosure database is perfect. Different providers can show somewhat different numbers depending on when defaults are recorded, when cured loans are removed, and how auctions and bank-owned properties are classified.
That's why I believe the most useful approach is to use the same source and methodology consistently and focus on the trend, rather than treating any one day's count as absolute.
The takeaway is fairly simple: foreclosure activity has increased approximately 73% since I began tracking it in June 2025, so the trend deserves our attention. But 26 properties out of roughly 9,000 represent only about 0.3% of the Palisades residential property base — approximately three out of every 1,000 properties.
Over the past seven months, the total has stayed between 23 and 26.
For now, I find the trend interesting rather than alarming.
I'll keep tracking it regularly, especially new Notices of Default and properties moving to auction or bank ownership. If we begin approaching 150 properties, based on what the Palisades experienced during the last housing downturn, my level of concern would change significantly.
Pre-Foreclosure / Notice of Default — 13
Notice of Trustee's Sale / Auction — 5
Bank-Owned / REO — 8
A property on this list does not mean the owner will ultimately lose it to foreclosure. Defaults and scheduled trustee sales can be resolved before foreclosure is completed.
Source: RealtyTrac and other public-record foreclosure sources. Figures are snapshots of foreclosure activity on the dates shown. Historical and current figures may use somewhat different methodologies and should not be interpreted as perfectly comparable measures.
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Foreclosure activity has risen since 2025, but the latest numbers remain a small fraction of the Palisades housing market.
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