My brother bought a house today at an auction. This is a nice home he will live in.
The Sellers simply chose to sell their home this way.
It wasn’t a foreclosure or sheriff sale.
The house sold for $230,000 which buys a nice home here in Wichita.
Have you ever bought a house or sold one at auction?
What was your impression of this way of buying & selling?
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2008 Recipient of Mr T – Brownbag One Liner Award
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It's an interesting process.We had done our homework and walked through the house several times before the auction and had had an electrician look at it and also a heating and air tech.We did our homework and knew what our limit was as far as price.So We went to the auction and there were probably 25 people there.I stood in the kitchen and talked to one of the people from the auction company while she handed out numbers to bidders.I watched people walk into the home and most had never even been in the home before!!Its a 1959 brick colonial. 2,700 square feet.The auction started promptly at the allotted time and the auctioneer spent quite a while just "talking up the home and warming up the crowd".Then the light turned green and they opened the gate for the bidding and they started the bidding really high but nothing happened. There was no interest and no bidding. Everyone just stood there.Finally they turned to the crowd and asked for a starting bid and my brother made a bid.Another couple then bid $5,000 higher and it was back to my brother and he raised them $5,000 and the bidding stopped at $220,000They kept trying to get someone else to bid. But nothing's happening.The auction stopped and the auctioneer and Seller who was present walked out of the room to have a private conference and for the seller to decide if he wanted to proceed with the auction and sell the home.The Seller had the option of saying "no" and the auction would have stopped with no sale.But he said "go ahead" and when the auction started again it became "absolute" meaining the house will sell that day for the highest price.The other couple made one final bid and my brother topped it and the bidding stopped at $230.The auctioneer then spent probably 20 minutes trying to squeeze some money out of someone but no one would bid and finally after what seemed like an hour he tapped the gavel and said "sold"In summary there were only two people who actually bid on the home.I was surprised no one else bid.I guess most people were just there to see if they could buy a house for 50% of market value. I think it's a good way to buy a house.This is the house he bought - it's a nice place.
Never bid on a house but have gone to many auctions with friends who were bidding.
Oftentimes the land unit is divided up into a number of different parcels, each being bid on independently; 5 acre lot then next to it the 10acre lot, then the house, that sort of thing.
Many times an option of someone bidding at the end of the auction on the total land for one price is presented and if that bidder tops the sum total of all the various independent bids then that bidder is awarded the win and the separated lot bids are eliminated.
More often than not that is how those type auctions finish around these parts.
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I've been to several house auctions. Seen them sell all over the place and sometimes not sell (seller wasn't happy with the price).
You tend to have different types of folks there:
1. Gawkers, people just curious to see what it will sell for. Neighbors for instance and friends/family of the sellers, etc.
2. flippers; people looking for a bargain they can flip. When your bidding started high, most of the flippers would have remained silent because they had no profit margin.
3. Landlords; people looking for a property they can rent out. IMO, the 'landlords' typically will pay more than the flippers but less than group #4
4. people looking for a house; These folks are usually the ones who will pay top dollar. I've seen them get into bidding wars and bid a house WAY past what it was worth (whether they really liked it or just got caught up in the moment, who knows).
If you're in group #4, then as long as you paid less for the house than you would have via a realtor, then you've come out ahead. Plus, there's something fun about spending thousands of $$ with the nod of your head. :)jt8
So what was that like?It was like coming THIS close to your dreams. And then watch them brush past you like a stranger in a crowd. At the time you don’t think much of it. You know we just don’t recognize the most significant moments of our lives while they’re happening. Back then I thought, “well, there’ll be other days.” I didn’t realize that that was the only day. --FoD
Good story but you left out the most important detail.What was the true market value of the property? Bob's next test date: 12/10/07
The house is worth $225 to $250,000So I can't really say he got a bargain.He's happy with what he paid and the Seller is happy to get it sold.The house has some unique features and some really nice built in cabinets.
mrfixitusa
Auctions are a funny way of buying.. The "winner" is the one who is willing to pay the most..
Not all bidders are legitimate.. I've seen it time and time again where one bidder is simply forcing the other bidder/bidders up.
It uses the most powerful sale tool of all.. which is Fear of loss is greater than anticipation of gain..
As a bidder on a house you don't want to lose which is a whole lot differant mind set than wanting to get something for the lowest possibe price..
I wondered if there would be people there to bid just to try to help the seller. That didn't happen this time.Interestingly the only other bidders were a nice couple and they really wanted the home.When they were outbid it was kind of emotional for them and the woman quietly cried because she had her heart set on buying the house.Yes your're right auctions to get kind of emotional.
Don't you feel bad about breaking that poor womans heart?
It's only money. You could find another auction property. But this woman had her dream destroyed..........
BEACAUSE OF YOU!
<G>
That is a nice looking house -- DC area, it is a steal at 230 -- close in DC in Maryland there are ranchers on a full basement 1950's style and construction on 7-8,000 sf lot in a desirable neighborhood that go for $1m and they are teardowns -- they do not look anything like the posted pictures -- tks for positing your experience -- I used to deal with foreclosures and have bought a few -- the house I am in now was a foreclosure and it is the place I am going to die in -- it is everything we need and more -- this is what we are all looking for a fair price, good condition, and something that we can live in forever -- moving is such a pain that it pays to take the time to find something that almost 100% meets your criteria - Dudley
Do you realize how difficult it is to price a house like this one?You can't compare it to a home of the same size built today or 10 years ago.This home has a 700 to 800 sq ft basement and the open STAIRWAY TO THE BASEMENT IS BEAUTIFUL The trick would be to get lucky and go to one of these auctions on a day when the other bidders are either investors or "beginners" looking for a bargain and then being able to buy the home at under market value.http://www.mccurdyauction.com/listing.php?id=973&action=realestate
about 4 years ago my wife and I discovered a house a few blocks away was in foreclosure process and on the way to auction.
We set about finding the owners and trying to buy it that way. Discovered there was a 2nd mort on the place that they could not sell out of.
Next was finding cash funds for auction. (Have to pay cash here for a forecl. at auction) We pulled the biggest HE loan we could--about 60,000$ Then got a 15,000$ cash adv on the credit card. That got us halfway there and a local mortgage lender we met offered to put up his own 80,000$ for a fee, and then we'd refi with him with at least 80% loan to value ratio-- and pay it all back. A good plan.
Auction day came.
There were about 12 bidders--all investors, flippers.
We were the 2nd highest bidders to a guy who increased the bids in 5,000$ increments. To my 126,500$ he quipped, "130!" and that was it. He could have outbid me by a dollar??!! He'd come with 145,000$ he was prepared to spend, and was chastised by the other 'flippers' in the auction--telling him he was nuts and that he was wasting his time...
We too, were crushed. We'd walked by the place nightly on neighborhood walks with our 1 yearold. We couldn't believe we'd be outbid to own the place, retail customers, by anyone trying to make a buck.
In the end, he flipped the house, selling it 3 mos. later for 180,000$ Today it's worth 225,000$ conservatively.
We're not to crushed any longer b/c we found a great place a few months later, but man, that would have been pretty sweet to get that one for 126,500$ if that guy hadn't been there!
Learned a lot.
"Research is what I'm doing when I don't know what I'm doing..."
if that guy hadn't been there!
I dont go to many house auctions but plenty of antique auctions and I dont know what I'd do with all the stuff that I'd have if that guy hadn't been there!
Doug
"I dont go to many house auctions but plenty of antique auctions and I dont know what I'd do with all the stuff that I'd have if that guy hadn't been there!"
Yeah, that guy! I even sat down with this guy after the auction and offered to make him 5 grand on the spot to let us have it.
Nope
"Research is what I'm doing when I don't know what I'm doing..."
You mean you might have to...gulp...build a shed?
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Oh I could build a shed with what I got now!
Doug