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Property Auctions

Discussion in 'Real Estate' started by SHELLY, Feb 16, 2006.

  1. SHELLY

    SHELLY SoWal Insider

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    Saw an ad in today's WSJ about an upcoming Florida Gulfcoast Real Estate Auction (SoWal & Bay County Properties) to be held at Cafe 30-A on March 4th. May be able to pick up a bargain?
     
  2. CastlesOfSand

    CastlesOfSand Beach Fanatic

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  3. Miss Kitty

    Miss Kitty Meow

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    Great idea...free drinks and auction paddles!!!

    Hey CoS...I'll be joining you in the SoWal jail!
     
  4. monty

    monty Beach Comber

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    I saw the ad in the WSJ and went to the higginbotham website. There are quite a few properties listed along 30A. This is a sign of the absolute softness in the local RE market.

    If you hear about the results, please post.
     
  5. Amp22

    Amp22 Beach Fanatic

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    Actually, auctions are quite common these days. We've had them here for years. Now if you see a list of foreclosures in the area - let us know ( absolutely:roll: ).
     
  6. Jellyfish

    Jellyfish Beach Lover

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    Just curious- why would an owner auction instead of simply listing for an attractive price? Unless you are talking about a real sellers market where multiple buyers are bidding the prices up, in a normal market aren't you always going to get a lower price in an auction?
     
  7. SHELLY

    SHELLY SoWal Insider

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    They've probably tried getting "their" price but "their" (too high) price wasn't the "market" price. So they believe going to auction is better then blowing up balloons and sitting at their house every Sunday afternoon waiting for buyers to come by and snap up the property at "their" price. (The owners who refuse to lower their price have the same mindset as the Worldcom shareholders who rode their stock into the ground. But with Worldcom one could only go to Zero, whereas with real estate, one can lose "minus-Zero" and end up having to bring money to the table to get out from under a mortgage. :eek: Real Estate investing isn't riskless--regardless of what developers say.)

    Usually when the properties go to auction (and the WSJ is listing more and more of these auctions across the nation every week) owners believe they can get an audience frothed up in a bidding war and hope to get "their" price or (hopefully) better. The sooner they get these properties out there while there are still a few folks who believe we're still in a "hot" real estate market, they have a better chance of getting "their" price.

    My guess is that a lot of these properties now going to auction are "investulators" trying to dump the properties into a softening market. IMO there will be more and more such auctions coming in the next few months to a year--the condo auctions will be especially interesting.
     
  8. SHELLY

    SHELLY SoWal Insider

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    From: RealtyTrac Inc

    "Despite a 29 percent decrease in new foreclosures from the first
    quarter to the fourth quarter, Florida documented the nation's highest
    foreclosure rate and accounted for more than 14 percent of the nation's
    new foreclosures in 2005. The state reported 121,843 properties
    entering some stage of foreclosure -- 1.67 percent of the state's
    households."

    I think we're going to start seeing foreclosures increase in the state, especially in the condo area, as we go into the year and as pre-construction sale condos come on line. Upscale areas will not see many foreclosures unless their owners are too deep into real estate investing. Even then, there are vulture capitalists waiting in the wings to "relieve" these folks of their burden so they won't have to suffer the indignities of going into foreclosure--provided the vulture covets their property and the price is low enough to make it worthwhile.
     
  9. Jellyfish

    Jellyfish Beach Lover

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    Not to be a vulture, but I hope so. We have been waiting to buy in SoWal for several years, not as investors but to vacation and then live there eventually. I was not about to jump into the frenzy over the past few summers....
     
  10. SHELLY

    SHELLY SoWal Insider

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    Your patience will pay off as the pendulum swings your way. And if you're a cash buyer...you're golden!
     
  11. HighBidder

    HighBidder Beach Comber

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    Location:
    Lakeland, FL or on a bus with a traveling band of
    Thanks for looking at our auction. I am sorry to say that there will not be free drinks before or during the auction. Cash bar will be open after the close of the auction. There are 21 properties for sale at this auction and we have recevied many calls from buyers out of state. This will be a large event for the sellers and buyers as well. Our next auction will be held in April. If you would like to talk to us regarding selling your property at auction please email us.

    Thank you again for looking and we hope to see you there.
     
  12. SHELLY

    SHELLY SoWal Insider

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    :sosad:

    It might be in the sellers' best interests to all chip in and have an open bar pre-auction...couldn't hurt to have the crowd liquored-up for the festivities. (Then again, there's that pesky little law about the possibility of voiding contracts if a person is intoxicated.)

    Sounds as if these auctions are going to be monthly event.
     
  13. Morgan

    Morgan Beach Crab

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    Is there a website for this auction??
     
  14. imasunbum

    imasunbum Beach Fanatic

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    Morgan - A name that is dear to my heart - my daughter's name!

    www.higgenbotham.com
     
  15. imasunbum

    imasunbum Beach Fanatic

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    I wonder if you have to be registered to attend the auction. Does anyone know :idontno:
     
  16. Cork On the Ocean

    Cork On the Ocean directionally challenged

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    The properties will sell for less than if the properties were listed with a realtor because the buyer is paying a 10% buyers fee over the sales price to the auctioneer (twice the standard commission.) Didn't find info if the seller also pays commission but assuming they don't so they can sell for at least 5% because the buyer is paying the commission and then some.

    I will be surprised if the sellers take significantly less than they were prepared to take minus the 5% commission. If they get 5% less, the seller pays 10% more. The seller gets the same and the buyer just paid 5% more. :eek:

    From their website:

    "Within all of us is a tremendous need to win. All interested parties are "forced" to make a decision. Excitement and motivation are used to the fullest with a public auction. Professionally trained ringmen apply continuous motivational pressure to the buyers to gain every dollar possible. This sense of excitement works to create the psychology of impending sale." :nono1:

    Might as well throw in the liquor. Is there any difference? :rolling:

    The standard FAR contract has a clause which allows the buyer to get out of the contract if the appraisal doesn't come in as high as the contract price.

    How bout the right to inspect? In a standard contract, the buyer has the right to have an inspection by a professional and the seller generally pays up to 1.5% in waranteed repairs and 1.5% for wood destroying organism damage.

    Of course no financing contingency if it's a cash deal.

    How bout seller's DOC stamps and title insurance? On $500k, sellers doc stamps are about $3500, buyer's doc stamps are about $1700 and seller's title policy is about $2550. Who pays that?

    It will probably sell for quite a bit less if buyer pay 10% buyers fee plus all closing costs.

    Would also be nice to know comparables - sold prices not list prices.

    Does the buyer get a chance to review the contract prior to purchase?
    If anyone knows these answers, please share.
     
  17. OnMackBayou

    OnMackBayou Beach Lover

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    Here are some properties I read about recently in the Destin Log that were sold in Miramar Beach. I have no idea how the selling prices relate to appraised value or previous sales of comparables in these areas.
    http://www.national-auction.com/results/results.htm
     
  18. landlord

    landlord Beach Lover

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    FWIW, I bought the house in Mountain Brook that is listed on that link. My wife and I are doing an extensive renovation on it. It was scheduled for an absolute auction; however, I negotiated a price with the seller in advance of the auction.
     
  19. SHELLY

    SHELLY SoWal Insider

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    I see absolutely no difference between the description of the auction (above) and what we just went through in the red-hot housing market when there were multiple offers and realtors were whipping people into a frenzy telling clients, "you'd better bid high--or you'll lose out!!" Same song, a slightly different melody.
     
  20. OnMackBayou

    OnMackBayou Beach Lover

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    Just took a look at your purchase. Holy cow! Are you going to give tours?
     

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