Auction sales, vacant homes, signs of distressed housing market.

Usually when a bank takes over a house in foreclosure they give it to a real estate dealer to sell. But, according to the Wall Street Journal, a growing backlog of homes from foreclosures has increased the use of auctions. Companies like “Real Estate Disposition Corp” organize these auctions, publicize and run them, selling most of the homes offered in most cases.

The good news for buyers is that homes at auction usually sell at good discounts. Recently, an auction by REDC in San Diego brought in prices that were 30% to 50% less than appraised prices. Experts believe that this is reflective of the general softness in the market.

Over in Florida, another hot market, the number of vacant houses for sale have doubled in the last year to 4.3% of the state’s total housing stock, the highest rate in the country. Meanwhile, building permits requested by developers have dropped in half.

With lower house prices, it should be easier for many people to get mortgages.

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