More Deals, Lower Pricing—A Look at What’s Going On at Foreclosure Auctions in Late 2025
Summary
Foreclosure auctions are rising, and pricing is softening in late 2025, creating potential opportunities for investors. Hosts can explore buying vacant REOs, focusing on metros where price-to-ARV is trending down, and keeping offers tight based on their max-offer formula.
Key Insights
- •Price-to-after-repair value (ARV) ratios moved lower in several metros, reflecting tighter underwriting and higher perceived risk, creating pockets where spreads are opening for buy-and-hold and value-add investors.
- •The number of vacant REO auctions is at a multiyear high.
- •Foreclosure auction volume increased while pricing softened in Q3 2025, according to the latest Auction Market Dispatch.
Action Items
- ✓Prioritize vacant REOs when speed to possession matters; price occupancy risk in.Effort: mediumImpact: medium
- ✓Favor metros where price-to-ARV is trending down and rents still pencil.Effort: lowImpact: medium
- ✓Use your max-offer formula (ARV × target discount – rehab – fees – margin), and stick to it.Effort: lowImpact: medium
Tools & Resources
- →Auction Market Dispatch: Foreclosure auction volume increased while pricing softened in Q3 2025, according to the latest Auction Market Dispatch, published by Auction.com.(auction.com)
Common Mistakes
- ⚠Don't chase borderline deals.
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