Excess Inventory | Bank Owned | Short Sale | Auction
Last week I attended areal estateauction at Harborside Convention Center in downtown Fort Myers. There were slightlys over 50 homes on the auction block at this particular auction.Auctionsare becoming more and more common with the new real estatemarket Southwest Florida is facing. Road side signs and billboards are popping up left and right for auctions.
What sort of homes were offered at this most recent auction? Homes from all over Southwest Florida - Cape Coral, Fort Myers, Naples, Golden Gate, Lehigh Acres, North Fort Myers and Sanibel Island. I am not sure why but there were no properties from Bonita Spring or Estero in this auction.
Of course there were short sales and foreclosures in the auction but there were other homes sold that weren't distressed. Now I bet you're asking, why would someone put their home in an auction?
- Clearing an estate
- Liquidating a portfolio
- Refining an existing collection
- Short sale
- Bank owned - REO
If you've heard of auctions and were wondering how they operate or if your home is a candidate you can visit the auction house website at www.HudsonAndMarshall.com. They came all the way from Texas for this auction and have a full schedule of auctions all over Florida in the coming months. Sadly, they also said that they'd be back soon since most of the homes were distressed and that business was booming. On the flip side, I overheard a mortgage broker say that the prior home owners were lucky. They were now out from under their dept load and have a chance to reorganize their lives. I guess most people don't think of it that way.
As a spectator at thereal estateauction, this is what I learned:
- It moves fast. No more than a few minutes were spent on most homes.
- The buyers set the starting price, more or less.
- Home prices sold from as low at $40,000.
- The most expensive home sold was $265,000.
- Not all homes auctioned will close. Some were sold subject to bank approval. The auctioneer states "Subject To" after he hits the gavel.
- Some homes don't make the reserve, the minimum price standard set by the owners or bank.
- Sometimes the scrappiest or dated looking homes fetched the most money - maybe they were on canals? Oil well in the back yard?
- There was a $5,000 buyer premium on top of the purchase price.
- You buy as-is. You can preview the properties prior to the auction but there are no repairs or warranties.
- Some buyers bought several homes.
If you have questions about auctions visit the Hudson and Marshall FAQ Page. There's a list of common question waiting to be read.
I admit it up front. I am no Spielberg so don't poke fun at the amateur video shot with my Treo phone. I just figured that since I was there it would be a great way to share it with anyone else who may be curious.