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Despite dark clouds rapidly forming in the U.S. economy and
housing market in early 2020, demand for distressed properties
has—at least thus far—remained relatively undeterred.
In fact, proprietary data from Auction.
com shows that buyer demand in the distressed
market has actually increased in the first
quarter of 2020 compared to a year ago.
More than 40% of all properties brought
to foreclosure auction via the Auction.com
platform in January were sold to third-party
buyers—typically local real estate investors.
at foreclosure sales rate jumped 21% from a
year ago to a 29-month high. Preliminary data
from February and the first half of March show
the foreclosure sales rate on track to continue
its year-over-year increases in those months as
well.
SHIFT TO ONLINE AUCTIONS
Of course, far-reaching national foreclosure
moratoriums along with widespread local court
closures all coalescing around the middle of
March mean that foreclosure auction sales
will largely grind to a halt well into the second
quarter. And rightly so, given the need to
avoid unnecessary foreclosures caused by this
unprecedented crisis, along with the health
risks inherent in a traditional foreclosure
auction: a public gathering of dozens if not
hundreds of people.
But the slowdown in foreclosure sales
in Q2 2020 will be more about a temporary
slowdown in supply rather than a dampening
of demand for distressed properties. at's
evident in website traffic and bidding for online
auctions of bank-owned (REO) properties on
the Auction.com platform.
Website traffic to online REO auction
THE FUTURE
OF AUCTION
SALES
With the economy and housing market in a period of unpredictable
change, what lies ahead for the foreclosure auction sector?
Feature By: Daren Blomquist
