An REO property, is a property that has gone through the foreclosure procedures and failed to sell at a foreclosure auction. After the Auction, the property goes back into the bank or institution’s portfolio. Once owned, by the bank, the property is then placed for sale, typically at a discounted price compared to non REO properties.
Let’s note that some REO properties might need repairs given the fact that those properties might have been vacant for an extended period of time.
Given the sometimes needed repairs and/ or updates, REO properties might offer an opportunity for a custom home while making the needed repairs and or updates.
In general, REO properties can present an opportunity for a discounted property. However, one might need to make needed repairs or updating for the property to be in an adequate condition.