The Folsom real estate market, a primarily residential section of the Sacramento County housing market, has seen a disturbing rise in the number of foreclosures as well as a decrease in the number of new homes sales. An October 12, 2010 report from the Sacramento Business Journal noted that “Bank repossessions of homes during September in Sacramento County climbed to the highest monthly total in more than a year to 1,066 homes, online foreclosure tracker reported Tuesday. That’s 34 percent higher than September 2009 and above the previous high mark of 1,035 set in March. However, notices of default and trustee sales notices were down in Sacramento in September compared with the previous month and September 2009. The number of homes sold to a third party at a foreclosure auction was also lower, by about 34 percent, from the previous year. The company noted it had not seen any effect yet in California of the moratorium on foreclosures by some lenders who had used automated processes for completing foreclosures.”

Fewer new Folsom homes for sale were sold in the most recent tracking period, although it seems that the overall market in the capital region may have stabilized somewhat. According to an October 15, 2010 report from the Sacramento Bee, “Sacramento's new home market just keeps getting worse, and that's holding back the region's economic recovery. A mere 288 new homes were purchased in greater Sacramento during the third quarter, according to a report to be released today. That's less than half as many as a year ago, and a further drop from the previous low of 485 homes sold in the second quarter…New housing construction in the six-county region has fallen to its lowest level in at least 40 years, according to the Construction Industry Research Board. The latest numbers offer more grim testimony to the health of the economy – and the problems facing home builders in a buyer's market. The overall housing market has stabilized somewhat, but much of the activity consists of foreclosed homes being sold cheap. With nearly-new homes available at rock-bottom prices – and the job market still weak – there's little appetite for new construction. "For some of these builders, the competition … is product they built a year ago that's now in foreclosure or short sale," said Greg Gross, an analyst with market researcher Metrostudy.”