Premier Auction - March 10, 2007

[P.A.G.]

bdc,

I can see where people have this opinion. A lot of companies will list and auction any property that they can get their hands on. This leads to such a wide gap between sellers and buyers. We are very selective in the properties that we take on. Our closing percentage is related directly with the our success. If we don't believe that a property has a VERY good chance of selling at the reserve price, then we will not list it. Thanks for your article.

 

[SHELLY]

I've been reading a bit about real estate auctions of late ... my take is that buyers and sellers are still miles apart on what they think property values are in this market, and this is keeping most auctions from being successful (with the expection of "absolute actions, where the buyer alone determines the "market value").

Most properties in these multi-property auctions are there because the seller has been unsuccessful selling the property in the conventional way. I'd bet the farm that their prices were too high for the 'conventional' market and they're having a hard time swallowing the fact that no one wants their property at the asking price.

Going to auction--where normally an item goes to the highest bidder--should serve as a reality check for the sellers. What is keeping the auctions from being successful isn't the buyers....it's the sellers. The market price for their piece of property in an auction is the highest price a buyer is willing to pay before the hammer goes down; and if the seller doesn't like it.......

 

[bdc63]

bdc,

Our closing percentage is related directly with the our success.

That's interesting. Is "closing percentage" the industries standard measurement? Is this something that a reputable auction house should be willing to disclose to either a buyer or a seller?

Can you give us your closing percentage (as well as your number of auction listings) for '06?

 

[bdc63]

Most properties in these multi-property auctions are there because the seller has been unsuccessful selling the property in the conventional way. I'd bet the farm that their prices were too high for the 'conventional' market and they're having a hard time swallowing the fact that no one wants their property at the asking price.

Going to auction--where normally an item goes to the highest bidder--should serve as a reality check for the sellers. What is keeping the auctions from being successful isn't the buyers....it's the sellers. The market price for their piece of property in an auction is the highest price a buyer is willing to pay before the hammer goes down; and if the seller doesn't like it.......

I see it a bit differently than you do, Shelly.

A market price is determined when you have a seller AND a buyer agree to a price. We pretty much don't even have a "market" right now, because there is no agreement (and nothing is selling). At some point, one of the two sides will decide that they can't wait any longer. Will it be the Buyers that flinch? The Seller? We all have to decide that for ourselves and place our bets accordingly.

 

[fisher]

I see it a bit differently than you do, Shelly.

A market price is determined when you have a seller AND a buyer agree to a price. We pretty much don't even have a "market" right now, because there is no agreement (and nothing is selling). At some point, one of the two sides will decide that they can't wait any longer. Will it be the Buyers that flinch? The Seller? We all have to decide that for ourselves and place our bets accordingly.

It's already happening and the sellers are the ones flinching. Just look at recent selling prices compared to prices one or two years ago. Many sellers are taking losses on property in order to get out. I have seen no examples of buyers flinching--except of course, the developers of Redfish Village that way overpaid for the lot in Blue Mountain in order to set the record straight on the product offering for the RV condos.

 

[SHELLY]

I see it a bit differently than you do, Shelly.

A market price is determined when you have a seller AND a buyer agree to a price. We pretty much don't even have a "market" right now, because there is no agreement (and nothing is selling). At some point, one of the two sides will decide that they can't wait any longer. Will it be the Buyers that flinch? The Seller? We all have to decide that for ourselves and place our bets accordingly.

Point taken...so it's neither a seller's market....nor a buyer's market....nor an auction. <insert cricket soundbite here>

With the sellers experiencing death by a thousand payments--my money is riding on the sellers blinking first.


.

 

[full time]

I see the comment about the crickets and no buyers. Any information on the number of houses under contract along 30-A? I've heard rumor that Watercolor has seen a spike in activity. Can anyone confirm?

 

[bdc63]

Point taken...so it's neither a seller's market....nor a buyer's market....nor an auction. <insert cricket soundbite here>

With the sellers experiencing death by a thousand payments--my money is riding on the sellers blinking first.


.

... and this statement I agree with totally.

 

[bdc63]

It's already happening and the sellers are the ones flinching. Just look at recent selling prices compared to prices one or two years ago. Many sellers are taking losses on property in order to get out. I have seen no examples of buyers flinching--except of course, the developers of Redfish Village that way overpaid for the lot in Blue Mountain in order to set the record straight on the product offering for the RV condos.

somebody needs to flinch MORE

 

[fisher]

I see the comment about the crickets and no buyers. Any information on the number of houses under contract along 30-A? I've heard rumor that Watercolor has seen a spike in activity. Can anyone confirm?

Things are beginning to move a bit in Watercolor--certainly not at a frantic pace but not glacial as it has been for the last 10 or 12 months. However, most of the sales are occurring at ever lower prices. Houses for around $400 per square foot and lots at prices from 2004 and even late 2003. There are losses being taken. The flinching has begun and will continue as builders get more desperate to unload aging inventory and investors dump excess lots.