Sunday, November 2nd, 2008 at 10:34 AM
Swap Meet
The auction went down as expected yesterday – mostly lower-end properties with some warts on them.
Here are the three most curious:
A. 6473 Caminito Formby, La Jolla 2br/2ba, 1,615sf
This condo was NOT bank-owned - the seller has equity and still has the property listed on the MLS for $675,000 with DOM = 74 days.
It sold for $546,000 yesterday (including the 5% buyer’s premium), about what they were selling for in 2003. Hopefully it’ll be enough to satisfy the seller’s reserve price.
B. 2575 Arundel, Carlsbad 6br/4ba, 4,608sf
Another low Bressi Ranch comp in the works – the former owner paid $1,151,000 in December, 2005, and another of this floor plan sold for $1.21 million in May of last year.
The minimum bid started at $469,000. It was bid up to $805,000, and with the ‘buyer’s premium’ of 5% added on top, it’ll be $845,250.
People may say that this is not a valid comp because it was an auction property, but I disagree. They gave ample notice, it was advertised in the MLS, and there were three open houses from 11-4 (and on infomercials non-stop) over the last two weeks.
C. 1488 Serene, Oceanside 5br/3ba, 2,963sf
My former listing where the bank turned down $502,000 a couple of months ago. The opening bid was $199,000 - everyone thought it would get into the $300,000s, but would it get into the $400,000s?
It sold for $420,000, and with the vig, $441,000. The BPO that I sent into the auction company was $445,000, so, if they listened, they might have sold it yesterday!
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Other notes:
1. There were probably ten properties that I saw come back for a second auction, where the initial winning bidder either doesn’t qualify once he gets to the booth, or gets cold feet.
They all ended up selling for less the second time around, which has to infuriate the sellers (and auctioneers).
One in particular was labeled a duplex, but you could tell in the picture that they were selling HALF of a duplex, and probably why it came back. During the second auction it was announced that it was a single-family attached, and not a duplex, and the auctioneer asked a contending bidder if he knew it was a single-family.
He said no.
He didn’t know what he was bidding on?
2. There were approximately 400 people total, with many coming and going. It was interesting to note how many non-bidders were there – it looked like a third of the attendees (and it could have been half) were there just to observe and take notes.
3. I LOVE THE AUCTION IDEA, and it has loads of promise for the market-clearing we need badly. I think those who attend like the excitement, and the idea of ending their search and walking out with a house! The winning bidders go straight to the financing and escrow booth, and, when done, have completed the vast majority of the paperwork. If the sellers would just ditch the reserve pricing!!
Wouldn’t it be great if we had a short-sale auction? It would be less angonizing for buyers if you could round up all the short sales every quarter (or every month?) and conduct the ‘Short Sale Swap Meet’. At least the buyers would know that they were the winning bidder, and once through the financing/escrow booth know that their offer was accepted – or not.
Posted on Sunday, November 2nd, 2008 at 10:34 AM in Auctions | 17 Comments » | 
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If it sells, it’s a comp.
The Blur | November 2nd, 2008 at 1:24 pmAgreed, and in a market where distressed sales are the norm, should you IGNORE regular-type sales?
If you’re a motivated seller, you should. The chances of the ‘lucky sale’ have diminished greatly, and if you need to move, expect that buyers will want ‘REO-type’ pricing.
Jim the Realtor | November 2nd, 2008 at 1:35 pmJtR, the buyer didn’t get cold feet, this was a case where the auctioneer won the bid. In other words, the auctioneer is bidding against the bidders in the audience -trying to get the price up to the reserve. When the person in the audience stops and the house is the winner, they simply bring it back out later and auction it off again. The auction they held at the beginning of the year, they had re-auctioned more than half of the properties when I left. I have not gone back.
JC | November 2nd, 2008 at 3:10 pmThanks Jim, very interesting.
greenlander | November 2nd, 2008 at 4:04 pmit is called a shill. an accomplice of the hawker. they bid it up but are supposed to bow out…not buy the sucker.
oh brother | November 2nd, 2008 at 4:58 pmI’ll repeat: auctions with shills and reserves are not auctions, they are boiler room high pressure sales tactics.
Rob Dawg | November 2nd, 2008 at 5:38 pmGolly, you guys make them out to be as bad as the stock market or something.
They obviously are fast-talkers, and I saw a few go out just as you described. The Serene bidder was a mystery man – I didn’t see anyone walk over to the booth afterwards, so who knows if it was a deal.
When I mentioned here that at the last auction I only found about 30% that actually closed, a rep from the auction company picked it up on his Google alert.
He questioned where I got my stats, and I told him I was in attendance and counted 60 days later.
I asked him to give me his stats, and he never got back to me.
Jim the Realtor | November 2nd, 2008 at 10:39 pmJim, that’s a great price for that 4,600 sqft Bressi home. that should be at least 2000 pricing if not 1999 pricing for carlsbad, no?
so was there a reserve for that home? or someone really did go home with that price?
ocrenter | November 2nd, 2008 at 10:41 pmGood one JTR, “where did you get your stats?” That was like when I not so discreetly snapped a photo of the computer screen bingo card showing which properties had hit the reserve and heard “Jimmy, camera…” mixed in with the auctioneers banter. They’re really trying to control the information. I looked up a bunch of properties at the county recorder and it looked legit. That is to say, the auction price + 5% is what it sold for on a majority of properties.
Jay Jay | November 2nd, 2008 at 10:50 pmDo they allow you to walk right in if you just want to watch or do you have to register with them.
Jimmy | November 2nd, 2008 at 11:59 pmOn the Arundel house, I think it was brandy-new in 2005. So it’s a bit hard to tell what a comparable 2000-2002 price would be. But I think it’s pretty spot-on for current pricing in that neighborhood. A fair price, but maybe not a “great” deal at $183/sf.
There are a couple of other comps in Bressi currently listed in the MLS (despite what the DOM says, some of these have been around forEVER):
A) Same/similar model: 2570 Discovery $895,000
5 beds, 5 baths
4608 Sq. Ft (Asking: $194/sf)
B) Much smaller: 2566 Discovery $825,000
4 beds, 4 baths
3480 Sq. Ft t (Asking: $237/sf)
C) 359 Huntington Drive, Carlsbad
5 BR/5 BA; 4040 sq. ft.
Offered at $899,900t (Asking: $222/sf)
D) 6209 Alverton Dr $900,000
4 beds, 5 baths
4644 Sq. Ft.t (Asking: $193/sf)
This one, however, is in deep doo-doo:
6344 Huntington Dr., Carlsbad
shoppingaround | November 3rd, 2008 at 6:04 am4 BR/5 BA; 3815 sq. ft.
Offered at $1,400,000t (Asking: $367/sf)
And recent sold comps in Bressi seem to have been in the $220-250/sf range.
shoppingaround | November 3rd, 2008 at 6:16 amlet’s take a look at a few 2000 closings:
1338 Alycon (3769 sqft)
–06/16/2000: resold $829,000
–09/24/1999: sold for $739,000 new const
1253 Bellflower (4538 sqft)
–05/05/2000: sold for $764,500 new const
2938 Carrillo (4055 sqft) SMSD
–11/02/2000: sold for $681,500 new const
6573 Coneflower (4891 sqft)
–04/21/2000: sold for $800,000 new const
that’s just a few I got scanning thru http://users.ixpres.com/~gtriphan/00-2carl.htm
$845k is a great price for 4600 sqft already landscaped home in carlsbad school district. anything at pre-2001 pricing you got to jump on guys. seriously there may be a chance it’ll go to 1999 pricing, but I don’t think folks should be sitting on the sideline when they see 2000 pricing because they are hoping for 1999 pricing. that’s foolish.
ocrenter | November 3rd, 2008 at 7:40 amYes Jimmy, you can walk right in.
JC | November 3rd, 2008 at 7:49 amAny auction where the winning bidder can easily bow out is not an auction. If bidders can’t prove they can buy before they bid, they need to put down a $1,000 deposit that becomes non-refundable if they bow out. Shills increase the labor cost, turn a specific auction into a sham, and cast doubt on all the honest auctions.
BDiego | November 3rd, 2008 at 11:57 amThere are not “shills” or actual people in the audience, this is the auctioneer himself bidding against any real bidder in the audience to get the price up. I heard an auctioneer refer to it before as “bouncing a bid off the wall”. They are going so fast, you can’t tell where the bid came from. Obviously it often comes from the wall. It’s really not a loss to them because they twist it as “We have a great opportunity for you to bid again on these 3 properties – don’t miss out a second time!!!”.
JC | November 3rd, 2008 at 12:29 pmSo, did that Bressi Ranch home sold?
jenny | November 3rd, 2008 at 3:04 pm