Auction.com has unveiled its 2025 Distressed Market Outlook, projecting a potential 8% decrease in foreclosure auction volume for the upcoming year. This baseline scenario is complemented by two alternative forecasts which could see an increase in auction volumes based on differing economic conditions.


Jason Allnutt, CEO at Auction.com, highlighted the importance of their platform, stating, “The Auction.com marketplace provides rich, real-time data on supply, demand, and pricing for distressed properties sold at auction nationwide.” This data is crucial for forecasting trends in the retail housing market.


The report indicates that foreclosure auction volumes are set to hit a three-year low in 2024. This decline is attributed to increased market headwinds, such as rising retail inventory and persistently high mortgage rates, which have impacted local community developers.


Auction buyers have shown a decreased willingness to pay prices relative to the after-repair value of properties towards the end of 2024. However, signs of recovery were evident in November and December, as price demands began to climb.


Evolution of default loan

Foreclosure Auction Supply

Completed foreclosure auction volume in Q4 of 2024 decreased by 3% from Q3 and was down 11% from the previous year, reaching its lowest since Q3 of 2021. Auction.com data, which represents nearly half of all completed foreclosure auctions nationwide, shows a 42% decrease from Q1 2020 levels.


Auction supply graph

REO Auction Supply

Bank-owned (REO) auction volume in Q4 of 2024 saw a 3% increase from Q3 and remained stable compared to the previous year. This volume is at 39% of Q1 2020 levels, marking a slight increase from earlier quarters.


Reo auction supply graph

Distressed Market Waterfall

The volume of distressed loans upstream from completed foreclosure auctions shifted in Q3 of 2024, with seriously delinquent mortgages rising by 10% from the previous quarter. Despite this, foreclosure inventory remains significantly below pre-pandemic levels.


Distressed market graph

Ali Haralson, President of Auction.com, noted, “While the number of distressed homeowners has returned to pre-pandemic levels, many are avoiding foreclosure thanks to ample home equity that allows them to sell through a pre-foreclosure sale.”


2025 Foreclosure Outlook

Daren Blomquist, VP of Market Economics at Auction.com, stated, “Emerging risks in the economy and housing market are pushing delinquencies higher, but those higher delinquencies will not likely translate into higher foreclosure auction volume until at least early 2026.”


The report uses a regression-based model with home price appreciation and unemployment rates as primary inputs. It predicts a baseline 8% decrease in foreclosure auction volume for 2025. However, changes in these economic indicators could lead to varying outcomes.


For further insights, the full 2025 Distressed Market Outlook is available for review.


This article is based on information from themortgagepoint.com, published one month ago.

More Articles

Getting licensed or staying ahead in your career can be a journey—but it doesn’t have to be overwhelming. Grab your favorite coffee or tea, take a moment to relax, and browse through our articles. Whether you’re just starting out or renewing your expertise, we’ve got tips, insights, and advice to keep you moving forward. Here’s to your success—one sip and one step at a time!

Foreign Investments in U.S. Real Estate: A Double-Edged Sword

foreign investment in U.S. real estate has surged to unprecedented levels, surpassing 1.2 trillion dollars over the past 15 years. This influx has sparked a robust debate among scholars and policymakers about the potential threats and benefits posed by such investments.

By |October 31, 2024|Categories: Article, Foreign Investment, Real Estate|Tags: , |0 Comments

Aflac’s Strategic Engagement with Gen Z: A Digital Evolution

With the rise of digital interactions, Aflac is tailoring its strategies to engage Gen Z and other demographics, focusing on seamless digital experiences and omnichannel engagement.

By |October 31, 2024|Categories: Article, Digital Transformation, Marketing|Tags: , |0 Comments

US Housing Market Faces Setback Amid Rising Mortgage Rates

U.S. single-family homebuilding sector has hit an eight-month low in June, largely due to escalating mortgage rates. This downturn suggests a potential drag on the nation's economic growth during the second quarter.

U.S. Economy Shows Resilience Amidst Cooling Labor Market

The U.S. economy continues to demonstrate its robustness, as evidenced by a notable GDP growth of 2.8% in the second quarter of 2024.

By |October 30, 2024|Categories: Article, Economy, Housing Market|Tags: , |0 Comments

Rising Tide of Risk: The Insurance Industry’s Climate Challenge

As we navigate this rising tide of risk, the insurance industry must innovate and adapt to ensure that protection remains viable for those who need it most. The stakes have never been higher, and the time for action is now.

Analyzing Mortgage Rate Trends in 2024: A Historical Perspective

With rates now in the low 6% range, a recent 50-basis-point rate cut by the Federal Reserve has sparked optimism among prospective buyers.

By |October 30, 2024|Categories: Article, Finance, Real Estate|Tags: , |0 Comments