When a property reaches the REO stage—Actual Property Owned—it indicators the ultimate step of the foreclosures cycle. The house owner is out, the public sale has been accomplished (typically unsuccessfully), and the lender now holds title.
For traders, the REO class can symbolize a singular alternative: properties priced under market worth, houses needing renovation, and stock that banks typically favor to liquidate effectively.
November’s REO knowledge reveals a continued rise in accomplished foreclosures in comparison with final 12 months, at the same time as early-stage filings pulled again. That mixture—fewer new filings, extra accomplished circumstances—is a trademark of a maturing foreclosures pipeline. It means the early misery we noticed in spring and summer season 2025 is now materializing into actual, actionable stock.
This month, the numbers additionally revealed fascinating regional and county-level variations. Some states noticed REOs surge sharply, others cooled, and several other counties skilled dramatic shifts in how rapidly properties moved from public sale to bank-owned standing.
If you happen to’re an investor trying to perceive the place actual distressed stock is rising—and how you can place your technique—November’s REO story is crucial studying.
Nationwide REO Exercise Climbs Once more
In November 2025, the U.S. recorded 3,884 REOs (bank-owned properties), down simply 0.15% month over month, and up 25.74% 12 months over 12 months.
This slight month-to-month dip is negligible—REO exercise stays considerably greater than one 12 months in the past. Nationwide, extra properties are finishing the foreclosures course of and returning to lenders’ inventories.
Bear in mind: REOs lag Begins and Discover of Sale by a number of months. So this year-over-year soar displays the elevated Begins we tracked all through 2025, particularly in fast-moving states like Texas and judicial states like Florida and Ohio.
State-Stage Breakdown: A Story of Diverging Markets
Let’s check out the 5 core states driving nationwide REO exercise.
1. Florida
- 311 REOs
- +27.98% MoM
- +132.09% YoY
Florida noticed one of the dramatic will increase nationally. Even with a steep decline in new filings this month, the state’s backlog of distressed properties continues to clear.
2. California
- 314 REOs
- –6.55% MoM
- -21.89% YoY
California bucked the nationwide development, posting each month-to-month and annual declines. This means that, whereas misery exists, circumstances listed here are dragging longer by the authorized course of.
3. Ohio
- 130 REOs
- +7.44% MoM
- -11.56% YoY
Ohio’s REO exercise is regular however barely decrease than final 12 months. This displays a extra normalized cycle after elevated filings earlier within the 12 months.
4. North Carolina
- 122 REOs
- -20.26% MoM
- +40.23% YoY
North Carolina continues to be one of many nation’s fastest-moving foreclosures states. Even with a month-to-month dip, REOs stay far greater than in 2024.
5. Texas
- 546 REOs
- +52.51% MoM
- +135.34% YoY
Texas delivered the greatest REO spike of any main state—each month over month and 12 months over 12 months. The state’s quick nonjudicial course of continues to push properties from Begin to public sale to REO sooner than any judicial state.
Why the REO Stage Issues for Traders
For traders, REOs supply a highly effective mixture of alternatives and benefits.
1. Banks turn into motivated sellers
When lenders take possession, sustaining the property turns into an expense, not an asset. They typically need these properties offered effectively and will value them under comparable retail listings.
2. Due diligence is simpler than at public sale
Not like at a courthouse sale:
- Traders can examine the property.
- They’ll order an appraisal.
- Title points may be addressed earlier than closing.
- Financing—together with non-recourse loans inside a self-directed IRA—is feasible.
This makes REOs an accessible entry level for brand spanking new and skilled traders alike.
3. REOs reveal the end-point of market misery
As REO ranges rise, it indicators that:
- Extra householders have exited their houses.
- Extra auctions went unsold.
- Lenders are about to launch stock to the general public market.
This can create alternative in each acquisition pricing and quantity.
4. IRA and Solo 401(ok) traders profit from timing
As a result of REOs transfer slower than auctions, traders utilizing tax-advantaged retirement accounts can:
- Carry out deeper due diligence.
- Prepare non-recourse financing.
- Construction long-term buy-and-hold methods.
In comparison with the quick tempo of trustee gross sales, REOs match comfortably inside retirement account guidelines and timelines.
County-Stage REO Insights: The place Misery Is Changing Quickest
Utilizing Possibility C (solely essentially the most significant adjustments), listed here are the county-level standouts for November:
Florida: Gulf Coast and Central Florida lead REO progress
- Lee County noticed one of many largest MoM REO will increase within the state.
- Orange County (Orlando) additionally posted a significant rise, indicating regular conversion from earlier filings.
- Miami-Dade and Broward stayed elevated, however moved extra modestly this month.
Investor perception
Florida’s REO progress is actual—and geographically numerous. Count on new stock throughout each coasts heading into 2026.
California: Inland Empire slows, LA stabilizes
REO declines this month had been pushed by:
- San Bernardino: One of many sharpest MoM pullbacks
- Riverside: Slowing REO conversion regardless of persistent misery
- Los Angeles: Stabilized, exhibiting neither a surge nor collapse
Investor perception
California’s REOs are cooling, suggesting longer foreclosures timelines and fewer quick-turn alternatives.
Ohio: Columbus and Cincinnati shift
- Franklin County (Columbus) posted a shock improve—one of many few counties to rise this month.
- Cuyahoga County (Cleveland) dropped, reflecting fewer auctions changing to REO.
- Hamilton County (Cincinnati) remained regular.
Investor perception
Columbus continues to emerge as Ohio’s most dynamic foreclosures market.
North Carolina: Volatility throughout main metros
- Mecklenburg County (Charlotte) noticed a significant MoM REO decline.
- Wake County (Raleigh) adopted the identical sample.
- Cumberland County (Fayetteville) skilled the steepest drop.
Investor perception
North Carolina continues to be rising YoY, however November marks a transparent slowdown in REO conversion.
Texas: The largest REO story in America
Texas delivered one of the dramatic county-level tales of the month:
- Harris County (Houston) noticed REO quantity surge sharply MoM.
- Dallas and Tarrant Counties (DFW) additionally reported substantial will increase.
- Bexar County (San Antonio) posted a robust soar, in keeping with its rising public sale exercise.
Investor perception
Texas continues to transform misery into REO at report velocity—best for traders looking for bank-owned alternatives.
How Traders Can Use REO Knowledge to Advance Their Technique
1. Determine markets the place stock is growing
Rising REOs typically result in:
- Extra distressed listings.
- Elevated negotiation leverage.
- Expanded shopping for alternatives.
2. Goal counties the place conversion is quickest
Counties with speedy Begin > NOS > REO development are perfect for:
3. Monitor lender habits
Banks with rising REO portfolios might:
- Value listings extra aggressively.
- Provide incentives.
- Prioritize sooner closings.
4. Use REOs to construct a tax-advantaged portfolio
Inside a Self-Directed IRA or Solo 401(ok), REO investing might supply:
- Potential tax-deferred or tax-free rental revenue.
- Lengthy-term appreciation.
- Structured mortgage methods utilizing non-recourse financing.
Take Management of Your Funding Technique
REOs symbolize the tip of the foreclosures cycle—however for traders, they’ll symbolize the start of alternative. With clear stock tendencies rising throughout key states and counties, now’s the time to review native patterns, consider property circumstances, and be prepared for brand spanking new listings as they hit the market.
To learn to spend money on actual property utilizing a Self-Directed IRA or Solo 401(ok), go to: www.TrustETC.com/RealEstate
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