But only with significant investment. There is plenty of demand from home flippers and landlords looking for great deals, but they get most of the good properties the courthouse auction.
"We have seen more properties selling at the initial foreclosure auction. They don't become REOs," said Rick Sharga, executive vice president at Ten-X, a real estate auction platform. "We are also seeing more rapid movement to sell REOs if those courthouse auctions don't work."
That means the homes that are left, the zombie foreclosures, must need thousands of dollars of work to make them either rentable or sellable. Government-backed mortgage entities like Fannie Mae and the FHA have strict lending requirements when it comes to distressed properties.
"Imagine a zombie foreclosure that's been vacant two to three years somewhere in the Northeast now becoming a bank-owned property. That is not for a first-time homebuyer and maybe not even for an investor. These are not properties that are going to fix the inventory problem, at least not when they are first repossessed," added Sharga.
Real estate agent Edward Augsberger has been working the Jersey shore over a decade, but only now is he trying to sell some of the worst properties he's ever seen.
"It's crazy some of the numbers. I've sold some things in Atlantic City for $3,000," he said.
The properties are scattered throughout neighborhoods all down the coast. After the housing crash and then major flooding from Hurricane Sandy, a lot of people just walked away. New Jersey's slow judicial process kept many of these homes in limbo for years, and they are just now coming to market.
"What you see is a handful of investors waiting for the property to get to that sweet-spot number," said Augsberger. "Anything will sell if it's priced right."