Banks are trying to capitalize on rising home prices by selling seized homes more quickly. States with some of the largest backlogs of foreclosures are seeing an upswing in properties that are moving to auction for quicker sales since last July, according to RealtyTrac.
“Lenders know there’s now a much better chance they can get those properties sold, so they’re moving to do that,” says Daren Blomquist, vice president at RealtyTrac.
The number of new foreclosures entering the pipeline is slowing. However, the number of foreclosures going to auction is seeing an uptick in 19 states, particularly in Oregon, Massachusetts, Utah, Connecticut, Delaware, and New York.
In New York, the average foreclosure can take 1,037 days to process, and in Florida, the process averages 929 days.
Back when buyers were on the sidelines and prices were still falling, lenders’ had little incentive to speed up the foreclosure process. Doing so would only add to the large amount of empty houses that needed to be maintained. But now that prices are rising in most markets, the backlog of bank-owned homes is being trimmed quickly. With tight inventories of homes for-sale in many cities, banks are seeing opportunity in getting repossessed homes back on the market faster for a quick sale, analysts say.