Don't like the back-and-forth bickering involved in home buying? Maybe you'll buy your next home with just a quick back and forth wave.
More homes are being auctioned than ever, with some $16.9 billion sold by private auction houses last year. That's not counting the foreclosed properties sold at sheriff auctions.
That's still a tiny slice of residential sales, but auction houses are anticipating residential sales could boom soon.
Bailout boon for auctions?
With the $700 billion bailout bill, the federal government has entered the home loan business in a big way, and will inherit lots of REO properties.
"REO" is lender lingo for "real estate owned," and refers to the homes that banking companies own after they're not sold at a foreclosure auction.
Indeed, when a foreclosure is finalized, a public auction is held. Professional investors, not ordinary homebuyers, tend to be the purchasers at these public, or sheriff auctions. It's the domain of professional buyers, because of thorny issues like possible unpaid taxes on the property, or the inability to inspect the inside of the home.
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With the influx properties coming on sheriff auctions, more are unsold and remain the property of the lending firm. One study, performed by the nonprofit Woodstock Institute, finds that in the Chicago region only 6 percent of properties were sold at the foreclosure auction in 2007.
When the government buys up home loans where the underlying asset is an REO home, many expect that Uncle Sam will start selling the properties at auction.
After all, the last time government took ownership of lots of properties was during the savings and loan crisis, and that was a huge boon for the auction business, notes Chris Longly, spokesman for the National Auctioneers Association.