U.S. Home Auction is auctioning off 375+ homes in the Phoenix area tomorrow and Sunday:
Doomers have given us their reports on other foreclosure auctions in the past, [Which we really appreciated!] and so far our crowd of "sideliners" is still waiting to see the really "hot" deals. If anyone is planning on going this weekend, if you’d take notes and either post or email your findings, we’d all love to hear how this one goes.
| Where: Maricopa County Events Center 19403 R.H. Johnson Blvd, Sun City West AZ 85375 |
| Time: Registration begins at 8:00 a.m. Auction starts promptly at 9:30 a.m. |
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Please, someone should go to this. We need a first hand report!
Do the homebuilders have fear in their eyes? Are bidders still believing they will ‘become richer than dreams of avarice”?
Not going to the one in Phoenix. The following weekend the same company will be doing the same thing in Vegas. They have 265 houses here.
The problem with these is that they are not absolute auctions. Although they list a minimum bid the owner/lender can accept or refuse any bid. Lenders often come back with a higher counter offer. All it really amounts to is a marketing tool to try to sell some dead inventory. There is also a 5% buyer premium on the bid price.
I went to a few of the open houses in Vegas last weekend, the last time they relied on the Realtor with the listing to hold open houses. This time all of the listings I looked at have been pulled from the Realtors and they hired non Realtor help to hold open houses.
One large loft I stopped at has a starting bid of $309,000, they list the “Previously Valued At” price as $1,050,000. I ran into a couple that paid $775,000 for a smaller unit in the same complex 6 months ago. They were not happy. She told me that when they bought they thought that prices had fallen as far as they would. She did not like my opinnion that we had another year or two to hit the bottom.
docdg-
I always roll my eyes when it’s not an absolute auction myself. Rumor has it though that lenders are getting more flexible, and are even consider offers below the reserve when no one bids. That’s why I’m kind of anxious to see what happens with this one.
They already did one of these in December, here in Portland, Oregon. Builder Buena Vista had something like 141 homes for auction… most went under his ‘reserve’ price. The Bend, Oregon stuff didn’t sell at all. Not one. Formerly one of the hottest housing markets in the US.
They did it again on March 10. Smaller sale.
Read about it here.
http://portlandhousing.blogspot.com/search/label/Auction
I don’t know how the Phoenix sales are set up. But I’d bet they get a ton of offers WAY below their ‘reserve’ price. What the builder does then, we have to wait and see.
I smell blood in the water.
I just returned from the “Arizona North” session, which included Phoenix proper and to the North, and added Ahwatukee. Bidders were much more cautious and subdued than comparable auctions I’ve attended in the past. Auctioneers were spending much more time on each property and really working the crowd much more than I’ve seen before. The bidding was definitely not going the way they wanted.
On average, properties we being bid to approximately half of the listed “Previously valued to” price. Surprisingly enough, I researched four of the properties, and the previous high they listed was reasonable at the top of the cycle. The homes in Ahwatukee finished at about $110/sft, and virtually everything else was sub-$100/sft.
In speaking with other investors there, I was told lenders are taking the high bid nearly all of the time now, which has not been true in the past with this type of auction.
Also, lots of homes were coming back up on the board as the lenders present weren’t comfortable with some of the buyers. I passed on pulling the trigger this time around. With required down payments rising, mortgage rates set to de-couple further from long bonds to the upside, and recession a household word, downward pressure will continue on prices, and those with patience are going to be rewarded.
azbear:
Thanks for the report!
Always good to get information from the field.
Now let’s see how they spin this in the Republic tomorrow.
Not incidentally, people over at calculatedrisk.blogspot.com are starting to get real nervous about the Bear, Stearns problem… could be a major problem come Monday morning. Check them, and bloomberg.com for updates …
az-bear: Yes thank you for the report. Can you tell me what the houses in Anthem sold for?
I’ve always been afraid to attend one of these auctions. I really don’t know how they work. But it is getting interesting.
AZBear-
Thank you for a great report. The homes aren’t going at absolute auction yet, but certainly we are seeing a shift in the attitude of the lenders and the tone of the auctions.
We appreciate your info!
yosarrian,
todays spin you were wondering…..front page, big color add (or “story,” i guess?)….
HOUSING DIP BRINGS OPPORTUNITIES
and even better…in saturday’s “phoenix republic” insert…..
PHOENIX HOME VALUES RISE 5.5%
LOL!!! If you all notice, the real estate related articles tend to be a bit closer to reality (i suppose?) during the week. But pick up a saturday or sunday edition and it’s one big advertisement.
pwwrigtt,
Unfortunately, the Anthem properties were auctioned in the second day (Arizona South; however that worked), so I don’t have any information for those. If you want to track them via Zillow (or some other tool) once the sales post, the addresses follow:
41253 N. Whistling Straight Ct.
3329 W. Honor Ct.
3732 W. Links Dr.
40331 N Lytham Way
Regarding the lender reserve, I went to the prior U.S. Homes auction and tracked 2 properties of interest through to the final sale to see if the auction offer was accepted. In both cases, the auction bid was the final sales price.
However, my advice would be to attend just to observe and get familiar with the process, pace, etc., but stay on the sidelines for a while. With ARM resets peaking in Q4 of 2008, a great price today won’t look very good at all in another year. I saw mostly 1st time home-buyers making bids; the investors didn’t budge.
Thank you: Will attend and stay on the sidelines to see if this is the route I want to go.