As foreclosure activity continues to normalize after years of pandemic-era protections, 2026 is shaping up to be an important year for land buyers looking for distressed opportunities. While most foreclosure data tracks homes rather than vacant parcels, states with elevated foreclosure filings tend to see more distressed land as well—especially lots tied to unfinished developments, unpaid taxes, or failed investment projects. For buyers willing to do due diligence, these conditions can translate into deeply discounted land.
Florida stands out as the top state to watch in 2026. High insurance costs, rising property taxes, and affordability pressures have pushed foreclosure filings higher than in most of the country. While much of the activity is residential, Florida regularly produces foreclosed residential lots, vacant subdivision parcels, and land tied to stalled coastal and inland developments. Investors focusing on inland counties often find better pricing with fewer environmental and insurance risks than near the coast.
Several smaller states show high foreclosure rates rather than raw volume, creating quieter but attractive land markets. South Carolina and Delaware consistently rank near the top on a per-capita basis, which often results in foreclosed lots and rural acreage entering county auctions. Illinois, New Jersey, and Maryland also deserve attention due to lengthy judicial foreclosure processes that can create inventory backlogs—sometimes including vacant land that banks or municipalities are eager to offload.
Finally, high-volume states like Texas and California remain important simply because of scale. Even with lower foreclosure rates, their sheer size means more total distressed properties, including infill lots, rural tracts, and land attached to failed developments. For 2026, the best strategy is to focus on states where foreclosure pressure, local taxes, and holding costs push land into auctions or REO listings—then narrow down to counties with clear access, favorable zoning, and manageable carrying costs.