Auctions and REO's on The Rise. Thoughts???

[Paul Z.]

In pretty much all major markets across the country pre-foreclosures have declined, however auctions and REOs are on the rise. Most likely because with rising property values banks are more quick to repo these props and get them back on the market to hopefully benefit. It's also probably because they are now finally catching up on their paperwork.

What I'd like to know however, is how this may effect the asking price of the REO props once they begin to flood the MLS listings? This is a particularly loaded question I know.....

I'm in the Chicago metro/urban markets btw so our situation is unique. We have growing home sales but stagnant contract activity and declining pending home sales Obviously seasonality plays into this however I believe it goes deeper than that.

Thoughts?