The Hidden Wave of Foreclosures Myth Costing Milpitas Buyers
Timothy Alston | Broker
Aegis Luxury Real Estate · DRE# 01328224
Published
November 04, 2021
Tech corridor crossroads
No wave of foreclosures is heading for the Milpitas market. The data is clear: fewer than 1.22 million mortgages remain in forbearance nationally, 93% of those homeowners have enough equity to sell rather than default, and total projected foreclosures from forbearance exits would be less than one-third of any single pre-pandemic year. The feared repeat of 2008 is not supported by the numbers.
You know how it feels when you hear something alarming about the housing market and you are not sure whether to believe it or ignore it? And then the concern quietly follows you around, shaping decisions without you ever really examining whether the fear has any foundation?
A lot of buyers and homeowners in Milpitas are carrying that weight right now. The word “foreclosure” has a way of doing that. It brings up 2008, the crash, the neighborhoods that emptied out. And when forbearance plans started winding down, a lot of people started wondering whether history was about to repeat itself.
But here is the part most people have not stopped to think about yet: the conditions that created that wave of foreclosures fifteen years ago simply do not exist today. So what does that actually mean for you?
What Does Your Concern About a Foreclosure Wave Actually Cost You?
Have you ever stopped to think about what a misread market moment costs you? Not in terms of a bad decision you made, but in terms of a good decision you delayed?
If you have been holding back from exploring homes in Milpitas because you are waiting for a crash that the data says is not coming, what has that wait already cost you in equity you did not build, in rental payments that built someone else’s wealth instead?
That is not pressure. That is just a question worth sitting with honestly.
During the housing collapse, approximately 9.3 million households nationwide lost their homes through foreclosure, short sale, or deed-in-lieu. Lending standards had collapsed, home equity was thin or nonexistent, and a nine-month surplus of housing inventory crushed prices. The Milpitas market, like much of the Bay Area, absorbed real damage during this period. Those conditions were systemic, not cyclical, and they are not present today.
The Numbers Behind the Wave Foreclosures Way Overblown Narrative
When forbearance programs launched during the pandemic, some analysts projected that up to 30% of all mortgage holders would enroll. That number would have been devastating. In reality, only 8.5% enrolled, and the share still in forbearance has since dropped to around 2.2%.
That leaves roughly 1.22 million mortgages still in active forbearance nationwide. Compare that to the 9.3 million households that lost their homes after the last crash, and the scale looks completely different.
Does that comparison land differently than what you expected? Can you see how the fear of a wave and the actual data behind that wave are telling two very different stories?
In the three years leading into the pandemic, annual foreclosure filings ran between 277,520 and 314,220 nationally. These were considered normal, healthy-market numbers. The projected foreclosures emerging from today’s forbearance exits total roughly 85,400, less than one-third of any of those baseline years. Milpitas real estate saw stable appreciation through this entire period, reinforcing how different today’s equity landscape looks compared to 2008.
What Happens to the Homeowners Still in Forbearance?
Here is where the story gets interesting. Of the 1.22 million homeowners currently in forbearance, 93% have at least 10% equity in their homes. That matters enormously. Why? Because 10% equity means they have options. They can sell, pay their costs, and walk away without a foreclosure on their record.
What about the remaining 7%? Even if every single one of those homeowners went into foreclosure, that total would be approximately 85,400 properties. Spread across the entire country. Not a wave. Not a flood. A fraction of what the market absorbed every year before the pandemic without blinking.
Ivy Zelman, founder of the respected analytics firm Zelman and Associates, put it plainly: the likelihood of another foreclosure crisis is close to zero percent. That is not optimism. That is someone who has spent a career reading housing data.
Rapid home price appreciation during and after the pandemic created an equity cushion that simply did not exist in 2008. Homeowners who might otherwise face distress now have the ability to sell at a profit rather than default. In Milpitas, where property values climbed significantly over this period, that cushion is even more pronounced. Forbearance was a bridge, not a trap, for most of the homeowners who used it.
If a Wave Is Not Coming, What Does the Market Actually Look Like?
In 2008, there was over a nine-month supply of homes sitting on the market. Today, that number is under three months nationally. Supply and demand are not even close to the imbalance that allowed foreclosures to crater values back then.
So here is a question worth asking yourself honestly: if the foreclosure wave is not coming, and inventory remains tight, and you have been waiting on the sidelines, what exactly are you waiting for?
What would it mean for your family if you spent the next three years building equity in a home instead of spending that same time watching from the outside?
Explore Milpitas homes for sale and see what the current inventory actually looks like for your budget and timeline.
The data points toward a market that is absorbing what forbearance exits are releasing, without the oversupply, without the equity collapse, and without the conditions that made 2008 so damaging. Whether that changes your thinking is entirely up to you.
If you want a straightforward conversation about where the Milpitas market actually stands for your specific situation, Timothy Alston, licensed Broker (DRE# 01328224), is available for a direct, no-pressure discussion. Not a pitch. Just a clear look at the numbers and what they mean for you. Reach out at (408) 207-4593 whenever that feels right.
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Broker · DRE# 01328224
Aegis Luxury Real Estate
Harvard Business School Online, Certified Master Negotiation
23+ Years Silicon Valley Real Estate Experience
Retired Military Veteran
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The data relating to real estate for sale on this display comes in part from the Internet Data Exchange program of the MLSListings™ MLS system. Real estate listings held by brokerage firms other than Aegis Luxury Real Estate are marked with the Internet Data Exchange icon and detailed information about them includes the names of the listing brokers and listing agents.
Based on information from the MLSListings MLS as of June 12, 2026. All data, including all measurements and calculations of area, is obtained from various sources and has not been, and will not be, verified by broker or MLS. All information should be independently reviewed and verified for accuracy. Properties may or may not be listed by the office/agent presenting the information.
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Aegis Luxury Real Estate · Timothy Alston, Broker, DRE# 01328224 · 10080 N. Wolfe Rd Ste SW3-200, Cupertino CA 95014 · (408) 207-4593
Last updated: July 09, 2026 | Data reflects July 2026 MLS statistics
