The auctions are coming

It certainly feels to us like the pace of real estate auctions is quickening. This makes perfect sense, given that the sales prices at recent big auctions have been in line with the overall market, which means auctions -- at least, well-publicized auctions -- are proving to be a decent strategy for stuck sellers.

That said, we noticed quite a few advertisements for auctions in the Sunday Los Angeles Times:

• 550+ foreclosed southern California homes ... "We're selling 186 LA-area home on Saturday, Nov. 10th at 1 pm at the Sheraton Park Hote at the Anaheim Resort." Auctioneer: Hudson & Marshall.
• 80 condos in Anaheim, San Bernardino and Riverside. Minimum bids (San Bernardino) from $75,000. Oct. 28th. Auctioneer: Kennedy Wilson.
• Nine "historic residences" -- one to three-bedroom "bungalows" in Pasadena. Minimum bids start at $790,000, auction is Nov. 4.
• 44 units at The Club at Big Bear Lake. Tuesday, Nov. 13.
• 4,000 acres in New Mexico. Nov. 15.

Thoughts? Insights? E-mail story tips to lalandblog@yahoo.com

Comments

[JK]

I guess I will never own in Pasadena. One bedroom bungalow with a minimum bid of $790,000... Arrgghhh!!!!

[Inland Empire]

Real estate auctions have been in the Sunday newspapers for a very long time. From the sample you show, it looks like some builders are unloading white elephants. Updates will be appreciated.

[Tombstone Realty]

WOW!!!

790K for a 1-bedroom in Pasadena!! WHAT A STEAL!!!! Oh I can't wait to empty my wallet for such a Darling Property.

Lookie at this on craigslist - 15 townhouses in Pasadena - "Harkness village". All going at the same time. Some condo conversion. YAY! Less housing for the renters!

http://losangeles.craigslist.org/sgv/rfs/453598336.html

[Cal]

We were at the Pasadena Heritage Craftsman House Tour and a few of the house tours were by the vista del arroyo auction, they had a bunch of signs up to try to generate traffic. Those places are in a fantastic part of Pasadena.

[sandiegan]

Well, I have to say those Pasadena Historic Homes are the nicest auction homes I've seen so far.

But far out of my geographic range.
Even further out of my price range.

But very nice.

[Rpche]

Some of these auctions are a sham.

I went to some open houses today for this auction:
http://www.ushomeauction.com/

At one of the houses, the RE agent told me that even if I win the auction and get a great price, the auction company/bank might invalidate the sale if they think the price is too low.

So it's not a real auction, it's just a sales gimmick and a waste of my time.

[Rob]

Whoa, auctions in what was some of the most prized real estate a couple years ago?

Okay, I see there is a lot of cash in LA, baby boomers looking for some investment, overpayed sports pawns, hollywierdows, yadda, yadda. How are you suppose to time the cash crunch in such an aberration?

[david]

I went to the REDC auction back in May, and wrote up about it here:

http://www.lululand.com/article.php/
redc_los_angeles_foreclosure_auction

I went back and looked at the May auction properties in September, and found that only about half of them eventually closed. Some where obviously bought by flippers, because they were closed in June/July, and back on the market again in August/Sept. Last I checked (a month ago), all of the ones bought by flippers were still on the market. Oops.

While some of the failed escrows were probably from stubborn lenders, I suspect most of the failed escrows were due to the bidder not being able to get financing. There were many properties that fetched high prices (relative to comp) but still didn't close. Unfortunately, those bidders lost their 5% non-refundable deposits, since there is no financing contingency when you bid at auctions. Hmmm. Sounds like a great way to make money.

I also went to the REDC auction in August. It included some unsold properties from the May auction. All the ones from the May auction fetched lower bids in August than in May. Overall, the discounts in August were bigger than the discounts in May. Though it'll probably be another month before the public records will show how many of them will eventually close.

I also went to the Hudson & Marshall auction in June. That one was pretty much the same as the REDC auction. However, the Hudson & Marshall auction had better refreshments. :)

[Tim K.]

I believe those Vista Del Arroyo Bungalows are part of those homes below the bridge where homeless camps were sitting for a very long time. If I'm not mistaken, there are banners out now declaring that this is *still* a homeless shelter?

If that's true, does this mean these homes are situated next to a new homeless shelter? Can anyone explain what that banner means? And why anyone would attempt to buy these high end homes here given such close proximity?

[Maggie Knowles]

Regarding the upcoming auction next Sunday at the Los Angeles Civic Center Exhibit Hall, USHOMEAUCTION.com, sellers have a reserve price set for each property. Buyers must have the winning bid AND meet or exceed the reserve price (aka minimum selling price). The reserve price is not published and they won't disclose what it is. (I called them for it on a property one of my clients is interested in, they refused to disclose it). So they don't have to sell it to you if the price is below their minimum selling price.

[andy]

I visited the Vista del Arroyo properties this past weekend. They are definitely "worth" something. The one bedroom was more than 2,000 sq. feet, I believe. They have multiple rooms that could be converted into bedrooms, including one long sunroom that has beamed ceilings overlooking the arroyo. The architecture and design is superb. I don't know if the price is fair, but nobody knows if any price these days makes sense. I guess it is OK if you can afford it.