Foreclosure auction volume reaches highest level since Q2 2020

Foreclosure auction volume in the fourth quarter of 2025 rose 48% from a year ago, reaching the highest level since the second quarter of 2020, according to Auction.com‘s Q4 2025 Auction Market Dispatch report.

Volume remained 39% below the level seen in Q1 2020, just before the start of the COVID-19 pandemic and its subsequent loss-mitigation measures, the company reported Thursday.

Volume grew across all loan types and in 43 states. Florida led the way with a 176% increase, followed by Georgia (+140%), Texas (+92%), Illinois (+41%) and Ohio (+4%).

A survey of Auction.com buyers in early January 2026 showed that 23% were more willing to buy at auction, up from 19% in the previous quarter. That figure was slightly below the 24% who said market conditions were making them more willing to buy in Q1 2025.

The foreclosure auction sales rate slowed in Q4 2025, falling 7% from the previous quarter and 15% from a year ago to reach a 23-quarter low. Year-over-year declines occurred in 69% the 88 major markets analyzed — including Chicago, Dallas-Fort Worth, Houston, Atlanta and St. Louis.

In contrast, the real estate-owned (REO) auction sales rate rose 29% from the previous quarter and one a year ago, partly due to more favorable pricing, Auction.com said.

The report found that buyers were willing to pay more at auction in certain markets. Foreclosure auction buyers paid an average of 67.4% of the estimated value, up from 66.2% the third quarter. REO buyers paid 65.2%, up slightly from the previous quarter but down from a year ago.

Foreclosure properties brought to auction rose 48% year over year to a 23-quarter high. Properties backed by U.S. Department of Veterans Affairs loans saw the largest increase at 428%, reflecting the end of a 2024 moratorium. Properties backed by Federal Housing Administration loans rose 56%, with conventional loans (+33%), private loans (+12%) and U.S. Department of Agriculture loans (10%) following.

The roll rate of scheduled foreclosures that reached auction increased to 26.6%, while average loan-to-value ratios remained up 5% from a year ago, indicating lower levels of equity.

Foreclosure auction pricing rose, widening the bid-ask spread and contributing to a drop in the sales rate. Meanwhile, REO auction pricing fell, narrowing the spreads and boosting sales.