13 WTHR - Indianapolis News |Home foreclosure auction

Home foreclosure auction

Homes that would normally sell for hundreds of thousands of dollars will be sold at deep discounts this weekend when they up for auction.

More than 70 homes will be auctioned off at the Mariott hotel downtown Sunday at 9 a.m., including one home in the 1500 block of Carrollton Ave. previously valued at $400,000. The starting bid is at $500.

A home on Brewster Road just north of 86th Street off of Ditch Road was valued at $300,000 with a starting bid of $59,000. Investors and home buyers could purchase homes this weekend for as much as 50-60 percent off the previous value.

Metropolitan Indianapolis Board of Realtors (MIBOR) President Larry Mitchell said it is important for recovery to get foreclosed homes off the market.

"When you have first-time home buyers able to go and possibly buy this large volume of foreclosed properties, they're not necessarily going to gravitate toward properties that are just normally listed," Mitchell said. "So, the more we can absorb and have first-time home buyers or investors buy these foreclosed properties, it's going to create balance back in the market and make it more healthy."

A slow recovery may be underway.

In March, 30 percent of properties sold were foreclosures, but new listings were at 15 percent, indicating the start of a decline. By August, 24 pefrcent of properties sold were foreclosures,
and new listings were at 14%. Another good sign is pending sales (deals that will likely close over the next couple of months) are up 2 percent. An increase in pendings has not been seen in a year.

"I think our height is behind us now," Mitchell said. "I think it was more in the 2007, 2008 time frame. And now we're seeing a decline in that, which is a real strong sign for our market.
You can definitely see, as these properties are going to be absorbed in the market by investors, or by other first time home-buyers, the level of availability of those homes is decreasing significantly which makes an even playing field for those that are just trying to sell their house under a normal market condition."

Another incentive that may continue recovery: the first-time home buyer $8,000 tax credit that expires November 30 could be extended.

In March, the same company held a foreclosure auction and 79 homes were sold. For more information on Sunday's auction, click here.