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MortgagePoint » Your Trusted Source for Mortgage Banking and Servicing News 64 March 2025 J O U R N A L Default Servicing FORECASTING FORECLOSURE VOLUME IN 2025 A uction.com has released its 2025 Distressed Market Outlook, which forecasts foreclosure auction volume decreasing by 8% in 2025 as a baseline scenario. The forecast also incorporates two other less likely scenarios with differing macroeconomic and housing market assumptions. Those two scenarios have foreclosure auction volume increasing in 2025. "The Auction.com marketplace provides rich, real-time data on supply, demand, and pricing for distressed properties sold at auction nationwide," said Jason Allnutt, CEO of Auction.com. "This data provides forward-looking in- sight into retail housing market trends." Auction.com's 2025 Distressed Mar- ket Outlook shows foreclosure auction volume dropping to a three-year low in 2024, based on both proprietary Auction. com data and market-wide public record data. Demand at distressed property auctions—for both foreclosure auctions and bank-owned (REO) auctions—has drifted lower to end 2024 as market head- winds such as rising retail inventory and higher-for-longer mortgage rates intensi- fied for the local community developers buying at auction. The prices that auction buyers were willing to pay relative to after-repair value also declined to end the year, al- though there were signs of price demand turning a corner higher in November and December. Price supplied by sellers at foreclo- sure auction remained flat in Q4, further widening the bid-ask spread between what buyers were willing to pay and the reserve amount sellers were willing to take to sell these properties. The late-Q4 jump in price demand did narrow the bid-ask spread in December, providing an early sign that the local community developers buying at auction are becom- ing more confident in the retail housing market for 2025. Foreclosure Auction Supply Completed foreclosure auction volume in Q4 2024 decreased 3% from Q3 2024 and was down 11% from a year ago to the lowest level since Q3 2021. Completed foreclosure auctions include properties sold to third-party buyers at auction and properties reverting to the foreclosing lender as real estate owned (REO). According to proprietary data from Auction.com, which accounts for close to half of all completed foreclosure auctions nationwide, completed foreclosure auction volume in Q4 2024 was at 42% of the Q1 2020 level. While scheduled fore- closure auction volume in Q4 2024 was at 52% of the Q1 2020 level, indicating a possible uptick in completed foreclosure auction volume in Q1 2025. REO Auction Supply Auction.com found that bank-owned (REO) auction volume in Q4 2024 increased 3% from Q3 2024 and was virtually unchanged from a year ago. REO auction volume in Q4 2024 was