Electronic Foreclosures

Francesco Mazzola

ERES from European Real Estate Society (ERES)

Abstract: This paper investigates how auction bidding formats affect U.S. mortgage foreclosure sales. Exploiting a staggered adoption of electronic bidding acrossadjoined counties in a “stacked” difference-in-differences design, I show that foreclosure auction success increases by 27%, and price discounts contract by42%. The effects are stronger in areas with more remote courthouses, and for properties in better conditions. Buyer composition of electronic foreclosureauctions shifts towards local non-professionals, who are less likely to buy-to-let and flip acquired properties ex-post. This evidence suggests that technologicalmodernizations in real estate markets can lead to better matching, deepen liquidity and foster financial inclusion.

Keywords: Credit Market; Electronic Marketplace; Mortgage Foreclosures; Online Auction (search for similar items in EconPapers)
JEL-codes: R3 (search for similar items in EconPapers)
Date: 2022-01-01
New Economics Papers: this item is included in nep-des, nep-fle, nep-pay and nep-ure
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Persistent link: https://EconPapers.repec.org/RePEc:arz:wpaper:2022_162

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