"Estimated net proceeds for auction sales including foreclosure auctions and bank-owned (REO) auctions were 43% higher than traditional REO dispositions through the third quarter of 2025, the report explained. The time value of money principle that a dollar today is worth more than a dollar in the future is key to understanding why earlier dispositions perform better, coming into even sharper focus in a slowing market, said Jason Allnutt, CEO of Auction.com."
"REO inventory, measured by the time held by a mortgage servicer, rose to 897 days through the third quarter of 2025, up 77 days compared to 2024 and 179 days from 2023. In contrast, REO auction sales averaged 320 days in inventory down 16 days from 2024 and down three days from 2023. Foreclosure auctions bypass REO inventory entirely, as properties are sold directly to third-party buyers."
"More than half of foreclosure auction sales in 2025 generated surplus funds above the debt owed, compared with 3% of REO auctions and 16% of traditional REO sales. The average surplus per foreclosure auction was nearly $57,000, available to junior lien holders and homeowners after junior liens are settled. Since 2018, Auction.com reported that foreclosure auctions through its platform have generated $2.8 billion in surplus funds."
"More than half of homes purchased at auctions since 2018 have been resold with 77% of these resales going to owner occupants as of the third quarter of 2025. This retail homeownership rate is 10% higher than for traditional REO dispositions, and it's consistent in both underserved neighborhoods and Opportunity Zones. Properties purchased at auction and resold within a year were returned to the retail market in 189 days on average 247 days faster than with traditional REO sales."
Auction sales, including foreclosure and REO auctions, produced estimated net proceeds 43% higher than traditional REO dispositions through Q3 2025. REO inventory held by servicers rose to 897 days through Q3 2025, while REO auction sales averaged 320 days in inventory. Foreclosure auctions sell directly to third-party buyers and avoid REO inventory, returning properties to market faster. More than half of foreclosure auction sales in 2025 generated surplus funds, with an average surplus near $57,000 and $2.8 billion generated since 2018. More than half of auction-purchased homes have been resold, with 77% going to owner-occupants and faster returns to the retail market.
Read at www.housingwire.com
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