Distressed property auctions are expected to hit a three-year low, according to Auction.com. Low inventories of foreclosed properties will keep distressed property auction activity down.
“Some 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,” said Daren Blomquist, vice president of market economics for Auction.com.
The forecast calls for 69,000 completed foreclosure auctions nationwide in 2025, down 8% from 2024 to the second-lowest annual total on record.
The lowest annual total on record was 64,000 in 2021 during the COVID-caused national foreclosure moratorium on government-guaranteed mortgages.
The company’s forecast assumes average home price gains of 4% and an unemployment rate of 3.8% in 2025.
Scenarios with slightly higher unemployment rates and lower price appreciation would increase the auctions this year, the company said.
Bank-owned auction volume reached a low in the fall of 2021 and has remained largely flat since the end of 2022. In the fourth quarter last year, the volume remained 60% below the level in the first quarter of 2020 at the start of the COVID pandemic.
