The Silent Crisis: Pre-Foreclosures Hold Steady in South Dakota, but Homeowners Feel the Squeeze

In the quiet neighborhoods of South Dakota, where the rhythm of life seems slower and the American dream of homeownership still holds sway, a financial undercurrent is putting pressure on families who are struggling to keep their homes. This June, ten properties in the state entered pre-foreclosure—a number that has remained unchanged from May but reflects a 9.1% decline compared to this time last year.

At first glance, these figures might suggest stability. But a closer look at the people behind the statistics reveals a harsher reality—one in which rising costs, stagnant wages, and economic uncertainty are stripping homeowners of the security they once took for granted.

A System Under Strain

Historically, South Dakota has not experienced the foreclosure waves that other states have weathered. The state’s worst year came in 2010 in the aftermath of the Great Recession when 918 homes faced foreclosure. The numbers have fallen significantly since then, with annual totals remaining well below 300 since 2016. In 2023, pre-foreclosures reached 206 for the year. And so far, 2024 is on pace to mirror last year’s numbers, with 88 recorded between January and June.

While the state’s economy appears relatively stable by national standards, the numbers tell a more complicated story. The lack of a dramatic spike in foreclosures doesn’t mean homeowners are thriving—it just means more of them are scraping by, often just one missed paycheck away from financial ruin.

The People Behind the Numbers

Take the case of Lisa T., a single mother in Sioux Falls who has spent the last year fighting to keep the home she worked so hard to buy. A medical assistant at a local clinic, Lisa’s expenses have soared while her pay remains stagnant. Groceries, utilities, childcare—all are more expensive than they were even a year ago. When her car broke down in March, she had to make a choice: fix it so she could get to work or pay her mortgage on time.

“I thought I had done everything right,” she said, eyes welling with tears. “I worked hard, I saved up, I got a home for my kids. But now, just keeping up feels impossible.”

Lisa’s story is one of many. South Dakota’s moderate foreclosure numbers mask the financial brinkmanship that many families are forced to play—juggling bills, scraping together payments, and hoping that nothing unexpected sends them over the edge.

A Housing Market That’s Less Forgiving

While South Dakota has not experienced the meteoric rise in home prices seen along the coasts, affordability remains a pressing concern. Mortgage rates remain stubbornly high, making it harder for struggling homeowners to refinance or sell to escape foreclosure. And despite a cooling market, housing prices have not fallen enough to ease the strain on would-be buyers or those trying to downsize.

Meanwhile, South Dakota’s rental market offers little relief. Monthly rents have risen, making it harder for displaced homeowners to find an affordable alternative. For those who lose their homes, the transition can be financially and emotionally devastating.

A Glimmer of Stability—But For How Long?

If history has taught us anything, it’s that foreclosure trends rarely hold steady for long. The absence of a major increase in pre-foreclosures this month does not mean the crisis is over—it just means it’s evolving. While June saw no month-over-month changes, the financial pressure is mounting for homeowners who find themselves caught between the rising cost of living and wages that haven’t kept up.

For now, South Dakota remains far from the foreclosure crises that defined the late 2000s. But for struggling homeowners like Lisa, statistics mean little when the fear of losing their home hangs over their heads.

If the state’s numbers are to improve, South Dakota will need solutions that go beyond the raw data: stronger consumer protections, more affordable housing initiatives, and resources that help families stay afloat. Because behind every foreclosure number is a family fighting to hold onto the life they built—one missed payment at a time.