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MortgagePoint » Your Trusted Source for Mortgage Banking and Servicing News 76 November 2024 J O U R N A L increase from 75 deaths reported in 2023. Over the past decade, winter weather has been responsible for 1,355 deaths, with 2021 seeing the highest number of fatalities at 236. The leading states for winter weather fatalities over the past decade include Tex- as with 200 deaths, Wisconsin with 118, and California and New York, each with 68. Preparing for the Winter Season Homeowners across the United States are encouraged to review their insurance policies as winter approaches. Experts recommend ensuring that their home and car insurance cover the full spectrum of potential winter weather damages. Additionally, homeowners should consider purchasing additional coverage for perils like flooding or high winds, which may not be included in standard policies. As winter intensifies, states like Oregon, Texas, and Michigan remain particularly vulnerable. Homeowners in these areas should take steps now to safeguard their properties and review their insurance options to avoid costly repairs down the line. AUCTION DEMAND WEAKENS IN Q3 AS RETAIL MARKET SOFTENS A ccording to proprietary data from Auction.com, early indications of waning demand for distressed properties sold at auction that appeared late in the second quarter persisted throughout the third quarter of 2024. Given that local community develop- ers are projecting retail market conditions roughly six months into the future—the average time it takes to renovate dis- tressed properties bought at auction and return them to the retail market as resales or rentals—waning demand from these developers who buy at auction points to ongoing weakness in the retail housing market into early 2025. "Just waiting for the market to correct and find balance," wrote one Auction.com buyer, in response to a survey regarding the impact of market conditions on bidding and purchasing behavior at auction. The survey was conducted between Sept. 25 and 27 and received responses from more than 140 people who have purchased properties on Auction.com. According to the survey's findings, more local community developers who buy at auction see the state of the market as a disadvantage rather than an advantage. This is despite the possibility that mortgage rates will decline as a re- sult of the Federal Reserve's September 50 basis point cut to the federal funds interest rate. About one-fifth (21%) of survey partic- ipants, who were all active Auction.com purchasers, stated that the market con- ditions in late September were making them less inclined to purchase, while over one-third (34%) answered the opposite. The remaining 45% claimed that their inclination to purchase was unaffected by market conditions. Some 30% of pur- chasers surveyed said that unfavorable mortgage rates were a market impedi- ment, ranking third in importance after higher acquisition costs (55%) and higher rehab expenses (49%). A lot of customers also cited election-related uncertainties as a rationale for delaying purchases. "The upcoming election has the world for me on hold since I don't know who will win the White House," wrote one survey respondent, joining about 10% of buyers surveyed who mentioned the election outcome as a factor influencing their bidding and buying behavior in an open-ended question on the survey. Auction.com Unveils Broad-Based Drop in Demand Every major auction demand statis- tic that this study tracks, including those for bank-owned (REO) and foreclosure auctions, decreased nationally in the third quarter when compared to the prior quarter and to the same period last year, indicating a widespread decline in buyer desire. In Q3 2024, the average number of bidders per property sold at REO auc- tion decreased by 8% from the previous year and by 10% from the previous quarter. Throughout the quarter, this demand indicator gradually declined, reaching a 23-month low in September. The average number of bids per REO sold in Q3 2024 was still 24% higher than the 2019 average, indicating that demand at REO auctions is still considerably above pre-pandemic levels despite this decreasing trend. On the front of foreclosure auctions, a similar demand trend was evident. The percentage of properties available at auction that sold, or the foreclosure auction sales rate, fell 3% from the previous quarter and 2% from a year earlier. The rate also declined during the quarter, hitting a nine-month low in September. This demand indicator was still 39% higher than the 2019 average, even with the recent decline. "Banks are not willing to lend as much money, and the interest rates on distressed properties are 10 per- cent," wrote one survey respondent, explaining why he is bidding on fewer properties. This buyer's viewpoint was in line with 55% of buyers who said that greater acquisition costs (finance or pricing) made them less inclined to purchase at auction. Out of the six market factors that were shown to survey participants, that was the greatest proportion. Measuring Auction Demand by Market A review of the top 65 metropolitan statistical regions in terms of the volume of foreclosure auctions in Q3 2024 shows that, despite a general decline in demand for foreclosure auctions nation- wide, more than four out of ten markets defied the national trend. Of those 65 markets, 29 (45%) reported higher sales rates in Q3 2024 than they did in the same period last