TBO.com - TBO is Tampa Bay Online

Auctions Of Homes Up As More Seek Cash

ADVERTISEMENT

The Associated Press

Published: July 18, 2008

NASHVILLE - Despite the soft real estate market, Beazer Homes USA recently sold 26 beachfront condos on the Jersey Shore in 75 minutes.

Auctions are no longer just for banks seeking to unload a foreclosure. In a sign of just how broad the real estate downturn has become, auctioneers say much of their business is being driven by homebuilders reducing inventory, and individuals who can't afford to wait out the real estate doldrums.

Christopher Gillen, an executive vice president for Beazer Homes, said the condos were the first the company had put up for auction in the area.

Before the auction, Beazer was asking between $400,000 and $850,000 for the condos, but sold them for between the high $300s and the high $700s, Gillen said.

The condo sales "may have taken a year-plus to sell if we had gone a more traditional route of putting homes on the market," Gillen said.

On Wednesday, the National Association of Home Builders said the business outlook of the major builders hit a record low in July. The monthly index posted new lows for sales conditions, shopper traffic and sales expectations.

Yet auctions are proving to be one sales solution for both builders and anxious homeowners.

Revenue from residential real estate sold at live auction grew about 5 percent last year and is up almost 47 percent since 2003, according to the National Auctioneers Association.

Residential real estate auctions had gross sales of almost $16.9 billion last year, up from about $11.5 billion in 2003.

But individual property owners aren't necessarily making a profit, or even getting what they paid for the house if they bought in an overheated market. Often the main benefit of an auction is getting out from under rising interest on house notes and paying other expenses, such as taxes and insurance.

Share this:

Loading Comments...

Email Print

ADVERTISEMENT