Archive for the 'Real Estate Auctions' Category (Chronologically Listed)

California Real Estate Auction Shows Housing Boom Long Gone

“Folks, take advantage of the market today.”

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Posted by Richard Barber on Jun 27 2007 under California, Real Estate Auctions





Slower Illinois Market Leads to More Real Estate Auctions

It’s a wild Chicago housing market these days.

Just ask real estate broker Crystal Nells, who put three Chicago apartment buildings on the market last year. Months later, only two were sold.

“This one just wasn’t going anywhere,” said Nells.

So what did she do? List the property on eBay, where she previously had sold books.

“I’ve gotten e-mails from all over the U.S. about it and a lot of people right here in Illinois that for some reason weren’t seeing it before.”

Nells is one of a growing number of sellers turning to online real estate auctions in the midst of a slow Illinois housing market. In addition to e-Bay, other online businesses are attempting to hit on the trend.

“We’ve almost doubled our business in the last six months,” said Tony Isbell, CEO of Rainbow City, Ala.-based RealtyBid International LLC.

He said a majority of the company’s sales are concentrated in the Midwest and Southeast. RealtyBid.com lists commercial real estate and timeshare properties, but Isbell said 99 percent of business is selling residential properties.

The company sells mostly bank-owned homes or foreclosures.

A report commissioned by the National Auctioneers Association shows that real estate is by far the fastest-growing sector of the auction industry, expanding almost 13 percent in 2006.

“It’s been within the last year that they’ve been selling real estate online successfully,” said Bill Sheridan, president of the association. “Our online technology is much better than it was five years ago and the consumer is more conditioned to using online bidding.”

While eBay has popularized online auctions, especially in this climate of slugging Illinois mortgage demand, real estate in general has been slow to develop as an auction-worthy commodity.

A few years ago, “the public wasn’t ready for it yet,” said Rick Levin of Chicago-based real estate auction company Rick Levin & Associates Inc., who launched online real estate auction site bid4real.com in 2000.

“People still have some trepidation about bidding for their largest asset on the Internet,” he said. “People want to see the property before hand, smell the smells, feel the walls.”

Isbell said buyers and sellers in online real estate auctions are the same as those in a live auction, including real estate investors as well as first-time mortgage loan applicants.

“The difference is that it’s a lot more convenient for the bidder with the online process,” said Isbell. ”You can bid anywhere, anytime.”

Companies auctioning more expensive real estate find consumers prefer to bid in person - especially if the would-be buyer plans on living there, rather than simply investing in real estate.

“We use the Internet a lot, but we don’t use it in the bidding function,” said Steven Good, CEO of Chicago-based real estate auction firm Sheldon Good & Co. LLC, who uses online auctions less than 5 percent of the time.

“Before someone’s making a half-million dollar or above buying decision, they understandably want to see the individuals involved and become comfortable with the transaction.”

SOURCE: Chicago Daily Herald




Posted by Richard Barber on Mar 08 2007 under Illinois, Real Estate Auctions





Real Estate Auctions Benefit From Arizona Housing Surplus

Valley home sellers frustrated by a lack of action on their listings will soon have another selling tool: real estate auctions.

According to the Arizona Republic, more than 100 homes are expected to go up for bid in a mass housing sale set for next month in downtown Phoenix.

Housing auctions, popular during the economic downturn in the early 1990s, are re-emerging as sellers look for different ways to make their home stand out. In the Phoenix housing market, more than 40,000 resale homes are on the market, 10,000-15,000 more than historic inventory.

National Real Estate Auction Corp. is planning the auction, scheduled for March 24 at the Phoenix Convention Center. The Scottsdale-based company is trying to buy serious inventory - 125-200 houses with prices ranging from the $100,000s to multimillions in the first of what it hopes will be a regular series.

“People think there’s a deal, and there’s a curiosity factor,” said John McCann, president of the auction company. “It creates buzz about the property. It’s pretty much a new form of marketing and advertising.”

The Valley’s housing market is struggling to pull out of the doldrums after the frenzy of 2004 and ‘05 when speculators and easy Arizona mortgage money created record sales and prices.

In addition to the 40,000 resale homes on the market, it is estimated that there are as many as 25,000 “spec,” or speculative, houses that builders have completed or are still working on but have not sold as Arizona home loan demand wanes.

“I like the concept of an auction,” said seller Dave Bean, who’s struggled for months to move his property. “It creates a sense of urgency to sell something. For some reason, the word ‘auction’ has a touch of magic to the consumer because they think they will get a good deal.”

But real estate auctions, especially for houses, can project the image of a cheap sale from a desperate seller. Sellers not willing to make big cuts may be frustrated to learn the buyers are bargain hunters looking for the cheapest possible mortgage loan or vulture investors who can afford to be choosy.

“I think they’re just kind of predators in a market where they can hopefully get a bunch of new home buyers and get enthusiastic response,” said Doreen Drew of Daisy Mountain Real Estate in Anthem, referring to auction companies.

“A lot of times, they don’t reach the reserve or the minimum amount. These guys are trying to create a little buzz: ‘I got my house at auction, and I got it cheap.’ And I don’t think the sellers have capitulated yet. I don’t think they have said: ‘I just don’t care. Just drop the price to the mortgage and I’ll walk away from it.’ ”

Brett Barry of Realty Executives said the two things stopping a home from selling now are price and the condition of the house.

“If sellers are going to participate, they need to say, ‘We’ve been overpriced.’ The typical seller, they are greedy, they will think this is the magic pill. What is the magic dust that makes the house sell? To me, it sounds more like a gimmick unless they can get the prices down,” Barry said.

McCann has high hopes that with home loan costs so expensive in Arizona, housing auctions will continue to gain steam.

Burns sees them as a symptom of the real estate cycle that will disappear when the housing market stabilizes, but he thinks people will go to them.

“It will be a function of price,” he said. “I think tons of people are ready to gobble them up if they are a real deal.”




Posted by Richard Barber on Feb 03 2007 under Arizona, Real Estate Auctions





Florida Mortgage Demand Decrease Leads to Real Estate Auction

With applications for Florida home loans not exactly flying off the shelves, measures need to be taken in order to boost local housing markets.

Hence the plan in Cape Coral to increase real estate sales via an auction. It will be held by Miloff Aubuchon Realty Group Inc.. With 120 properties up for bid, this could be the largest ever held in the area.

“Any time a multiproperty auction is held of more than 30 properties it is considered a large auction,” said Earl Williams, real estate auction manager with Higgenbotham Auctioneers International Ltd. of Lakeland.

“Considering the number of properties at this auction it is an extra large one. That’s why we broke it up into two days.”

A slowdown in real estate sales triggered the idea for the auction, said Jeff Miloff, the group’s sales director.

“The auction might also be the future of the real estate industry,” Miloff said. “People have gotten used to auctions because of eBay.”

The Aubuchon Miloff sponsored auction for three commercial properties and 66 residential lots begins 11 a.m. Friday. Bids are scheduled to begin for 44 homes 11 a.m. Saturday.Seven luxury waterfront homes come up for bid at 7 p.m. Saturday.

Although the majority of the properties are in Cape Coral, there are a few in Fort Myers Lehigh Acres, Estero and other regions of the Florida housing market.

“The idea came from Terry Mell in our office. We worked on putting it together with Higgenbotham Auctioneers for five months,” Miloff said. “We are so excited and optimistic that we are having another one in February or March.”

Hardly containing her excitement about the auction, Virginia Ward, 67, said she and her husband David, 69, are having a lot of fun putting their home up for auction.

They reside in a three-bedroom, two-and-a-half-bath, single-story home on Dolphin Canal in the Yacht Club area and hope to attract a bevy of Florida mortgage applicants over the weekend.
The home’s fair market value is $862,410, according to the Lee County Property Appraiser Web site Leepa.org.

“We did all our research and we decided to go with the auction partly because Jeff Miloff came out himself to talk to us about it,” Ward said.




Posted by Jed Moss on Jan 16 2007 under Florida, Real Estate Auctions





Florida Condo Auction Nets Numerous Bidders, Few Sales

In efforts to increase sales and attract buyers, real estate auctions are gaining more and more traction across the country. They’re typically a great way to find deals on reduced properties.



With this in mind, forty condominium units at The Hamptons at Tampa Palms were sold at a public auction over the past weekend, at an average price of $148,000 a unit.

J.P. King Auction Co. of Gadsden, Ala., managed the sale of the Florida condos, which were among the most expensive converted apartments in the Tampa Bay area. The auction attracted 171 bidders from 15 states as far away as Minnesota, Nevada and California.

The sale disposed of 20 two-bedroom units, 15 three-bedroom units and five one-bedroom units, at a total price of just above $5.9 million, a J.P. King spokesman said.

Bay Communities Real Estate Inc. converted the 315-unit Hamptons complex in July 2005 and decided to put 100 condos on the block during the December 9 auction, conducted at the Grand Hyatt Tampa Bay hotel on Rocky Point. The idea was to pump up Florida mortgage activity in the area.

“We came to reduce our inventory, and that’s what we did,” Bill Harkins of Bay Communities stated in a release Monday. “We got 40 units sold and some people got a great deal. It’s a very soft market.”

Among the crowd were several other condo developers who observed the Hamptons sale as they consider auctions to reduce their own inventories. With median home prices in Florida decreasing, this should be time for buyers and mortgage applicants to jump back into the game.




Posted by Jed Moss on Dec 12 2006 under Florida, Real Estate Auctions





Foreclosure Auctions Offer Abundant Deals, Risks

Don’t believe late night TV infomercials. Buying properties in foreclosure is not an easy way to get rich quick.

“It’s the most dangerous way to buy a piece of real estate,” warns David S. Absher, president of Dual Arch International, whose Modesto, Calif., firm auctions foreclosed properties daily on the steps of the Stanislaus County Courthouse. “When you buy a house at real estate auctions, it comes with no guarantees whatsoever. All you get before you bid is a sidewalk view of the property.”

In other words, if the inside has been gutted by fire, trashed by vandals or stripped of appliances, fixtures and cabinets by previous owners, you’re out of luck. Also common are would-be bidders who mistakenly believe get-rich-quick promotional pitches about buying property with only a 10 percent down payment or with simply a letter of credit.

That’s not true.

Bidders must have cashier’s checks made out to the home mortgage company for the home’s full purchase price before they’re even allowed to bid.

“Those guys on TV are making their millions by selling you tapes and books, not by buying real estate themselves,” Absher said.

Most foreclosed homes that went to auction this fall in Stanislaus County weren’t purchased because the outstanding debt was more than the homes were worth, according to the Modesto Bee.

The mandatory minimum bid, therefore, was too high to attract bidders, and lenders got stuck owning the property. That was the case recently with a five-bedroom home on Alberto Way in Oakdale, which required an opening bid of $479,099.53. No one bid.

That doesn’t mean good deals can’t be found.

Eddie Diaz thinks he got one. Two weeks ago he outbid three other California mortgage seekers for a home in Oakdale. The minimum bid was $156,526.50 for the two-bedroom home built in 1910. After about 80 bids, Diaz ended up with the property for $198,500.

“I’m very good with carpentry,” said Diaz, explaining his plans to fix up the home and keep it as a rental.

Hope of finding a bargain is what lures people to auctions. In Stanislaus County, there are a few experienced investors who attend virtually every auction, along with a few rookies who mostly watch and occasionally try their luck bidding. In California, where housing affordability is not always easy to find, a lot of people are seasoned pros at finding deals because they’ve been forced to.

“If you don’t see the big players bidding, there’s a problem with the home,” cautioned Al Ferreira, owner of California Pacific Brokers in Modesto.

Ferreira was a bidder on courthouse steps for eight years, so he knows the dangers.

“It’s very high-risk,” said Ferreira, noting that the worst mistakes are made by those who don’t do enough research.

One woman thought she got a steal after placing a top bid at a foreclosure sale. She thought she had bought the home’s first deed of trust, but it was the second deed of trust, often called a second mortgage loan. When the first mortgage eventually went to foreclosure, the second deed became worthless.

“She lost $100,000,” Ferreira said.

Absher confirmed that story and said such mistakes are easy to make because legal title recordings can be confusing, complicated and incomplete.

“There can be a lot of liens,” Ferreira said. He cautioned bidders to particularly be wary of bail bond liens because they can signal trouble. “Those houses are usually pretty beat up.”

Ferreira no longer bids on foreclosed homes because he’s found an easier way to make money: He sells homes on behalf of the mortgage lenders who foreclosed on them. Ferreira now lists more than 20 lender-owned properties for sale in Stanislaus and Merced counties, and he expects to list 40 homes by the end of the year.




Posted by Richard Barber on Nov 28 2006 under California, Foreclosure, Real Estate Auctions





Michigan Real Estate Auction Draws Hundreds of Bargain-Seekers

You wouldn’t have known that the housing market was in a slump and that the rates of foreclosure among Michigan mortgage holders were soaring - at least not judging by the crowd of prospective home buyers vying for nearly 90 properties at a real estate auction in Troy, Mich., on Sunday afternoon.

According to the Detroit News, an eager, standing room-only crowd of about 600 people packed a room hoping to snag luxury homes and other properties at bargain prices. The auction was sponsored by Neumann Homes and allowed builders to unload property and recoup some losses in the midst of a stagnant Michigan housing market.

Many of the high-end residences were furnished and were builders’ models. Some were builders’ closeouts. An upscale, three-bedroom home in Rochester Hills sold for $400,000 in the first 15 minutes of the auction. The asking price of the 3,031-square-foot, three-bedroom home was $523,297.

A few minutes later, a home in the same subdivision sold for $315,000. No deep discounts pervaded, but there were some good deals during the day.

Buyers also had to pay a 3 percent real estate auction premium for their homes. The properties mostly were in Oakland County communities, such as Rochester Hills, Clarkston and Highland Township.

Don Marlinga, a Clarkston resident, said he thinks he got a good deal on a four-bedroom, 2,576-square-foot home in the Cheshire Park subdivision in Clarkston, paying $215,000.

“I’m happy. Time will tell whether I got a deal,” he said.

The auction was a nail-biter for Tim and Sandy Sam. The couple had their hearts set on one of the luxury homes nestled on the Oakhurst Golf and Country Club in Clarkston, but they weren’t budging from their $275,000 budget. The home they wanted went for $280,000 to another bidder.

“We had discussed how much we wanted to spend. We almost had it,” Tim Sam said.

Elyse Record, a Detroit homeowner, was hoping to get in on bidding but couldn’t because she wasn’t able to register in time. She said a misprint in literature for the event caused her to miss the deadline. When the next real estate auctions come around, she said, she’ll be ready.

“There were good buys. I’m looking forward to the next (auction),” Record said.

Matthew Chojnacki, president of Harbor Mortgage in Berkley, said turnout at the auction shows there’s hope for the state’s housing market, particularly if Michigan mortgages remain cheap.

“There are plenty of people interested in buying a house,” he said. “The market is not as bad as everybody thinks. It’s just that a lot of people want to buy a house but they have a house to sell, too.”




Posted by Richard Barber on Nov 20 2006 under Michigan, Real Estate Auctions





Real Estate Auctions: The Basics

As we discussed last week, real estate auctions are expanding rapidly in this down market, as more and more citizens look to new ways of selling real estate.

But few understand the nuances. Before considering this option, it’s very important to note how much of a difference it can make in your efforts to sell a home. From the buyer’s angle, the money you can save could directly affect your mortgage costs, but only if you do it right. Below is a brief overview.

TYPES OF AUCTIONS

• Absolute: The property sells regardless of price. Often seen during home foreclosure proceedings. Sellers are often reluctant to participate in an absolute auction because they relinquish the right to reject an offer.
• Minimum-bid: The seller entertains offers above a certain price. Bids begin at the amount designated by the auctioneer, but the seller is still not obligated to sell to the winning bidder. In many cases, however, the price is set at a level the sellers would strongly consider accepting.
• Reserve: The seller accepts bids only if they’re above a secret minimum that the auctioneer doesn’t disclose to those bidding. So buyers can make an offer without any idea of whether it will actually be accepted.

COSTS OF AUCTIONS

• The seller pays: Advertising and marketing expenses.
• The buyer pays: A 10 percent “buyer’s premium” that’s added to the amount of the bid.

Definitely worth keeping in mind if you’re selling, as a real estate agent generally spends thousands of dollars marketing a home. If you’re going to go the auction route, it’s all going to be on you. As a buyer, you may be getting a good deal, but remember that extra 10 percent on top of the home price is significant.







Posted by Richard Barber on Oct 30 2006 under Real Estate Auctions





Residential Real Estate Auctions Expand Nationwide

The number of auctions nationwide rose 5.9 percent in the third quarter of 2006 over the same period last year, led by a growing number of residential real estate auctions, according to the National Auctioneers Association and an article in The Chicago Tribune.



As the housing market cools and unsold property inventory rises, awaiting a buyer, both residential real estate “buyers and sellers are turning to the auction method, and we foresee this trend continuing to increase,” William Sheridan, president of the Overland Park, Kan.-based trade group, said.

The number of residential real estate auctions, the industry’s fastest-growing segment, grew 4.5 percent in the third quarter.

Part of the growth might be due to the fact that auctioneers are making a bigger effort to get the word out. They spent 12 percent more on marketing and advertising in 2005 than in 2004, the group found.

Also, however, more residences are going into foreclosure as adjustable-rate mortgages reset and borrowers cannot keep up with payments. These types of property often head to the auction block.

We’ve discussed the pros and cons of bidding on them, as well. For some, foreclosed properties may offer the best homeowning deals. Just be aware of how the process works.




Posted by Jed Moss on Oct 27 2006 under Real Estate Auctions