Real estate auctions can stir up interest, bring quick sales
May 6, 2012 | Posted by in Real Estate | 0 Comments
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By David Slade, The Post and Courier, Charleston, S.C.
May 6–When 15 luxury residential condominiums in downtown Charleston were offered at auction Monday, the sale provided a look at an exciting but uncommon method of selling real estate.
Private auctions are seen as a way of prompting a quick sale, by raising interest in a property and forcing multiple buyers to compete.
By some estimates, auctions account for less than 1 percent of real estate sales in the Charleston area. That’s not counting government auctions of foreclosed-upon property.
“Most people, when they hear the word ‘auction,’ think of desperation, but that’s not the case,” said Carolina One auction professional Gregg Napier of the Gregg Napier Auction Group.
“It’s more for the individual who wants to move the property now, needs it gone, because maybe they have other plans,” he said.
The 15 units at Anson House that just went on the block, for example, had mostly been sitting unsold since they were built, just before the housing bubble burst. Just one condo in the 32-unit building had sold since September 2009. The rest are the subject of a foreclosure lawsuit filed by Bank of America.
The sales event, run by The National Auction Group of Gadsden, Ala., stirred up lots of interest with pre-auction marketing.
William Bone, the company’s president, said more than 200 groups of people toured the condos in advance of the sale, and while no units were actually sold at the auction, deals were closed on four units during the week.
At the auction, there was plenty of bidding, but the apparently winning bids were then all rejected as being too low. That left some bidders frustrated.
Bert Golinski, founder of Rebel Capital Advisors LLC, attended the auction and said it was a big waste of his time.
“I spent two hours looking at the units pre-auction and another two hours at the auction yesterday,” he said Tuesday.
But for the sellers, the interest generated by the auction resulting in four condos being sold at prices ranging from $580,000 to $1.5 million. Those are greatly reduced prices, less than half the original asking prices at Anson House, but also more sales in one week than the building had seen in three years.
National Auction Group remains at the building, at 2 Laurens St., and Bone said they hope to sell the remaining units as well.