PROView - July 2008 - (Page 21) (Continued from page 19) Leslie Newman, agent with Charles Rutenberg Realty, recently worked with a buyer who was interested in purchasing her home at auction. Step one, she said, is to register with the auction company as a buyer’s representative. “You want to make sure the auctioneer knows your affiliation upfront so that you are eligible to receive all the pertinent information about the property and the auction itself. You also want the auctioneer to know immediately that any purchase will be subject to commission split with you.” Prior to auction, REALTORS® are advised to assist a buyer with finding out everything there is to know about a property. Anderson: “We want the buyer to feel very comfortable by the time they enter their bid. Our goal is to have a buyer only thinking about purchase price at the auction - nothing else.” Buyers may want to hire a property inspector, which they pay for themselves, prior to auction but often times sellers have had an inspection done within the last year. “Buying real estate is a high dollar investment – and it’s just prudent judgment to hire an inspector,” said Anderson. “It may be well worth a small invest to buy the peace of mind.” Important to know, however, is that foreclosure auctions may not always provide that same opportunity. Conducting a Short Sale through Auction An ever-increasing occurrence these days is that of short sales and a commonly asked question is how an auction fits into that picture. Can an auction even be a short sale? According to Williams, experienced in working with lenders and owners of distressed properties, the process of doing a short sale through an auction is similar to a traditional real estate transaction. “A foreclosure is as devastating to a lender as it is for a homeowner and most lenders are becoming more receptive to a short sale in order to avoid potentially worse losses, whether through a traditional transaction or an auction.” Clearly, pre-approval by the lender is necessary before the auction company starts the process of selling a home. Traditionally, a REALTOR® advises a customer about a sales price based on current market value, offers come in and lenders either approve or deny any given purchase bid. In an auction, however, there is no set price, only the highest bidder. Asked what stipulations lenders typically make, Williams points out the fact that an auction will in fact deliver whatever the market determines the value to be.“ So, are all lenders typically willing to consider a short sale through auction? According to Williams, the primary loan market is fairly easy as for working out a solution whereas the secondary market is very challenging, but that would hold true regardless of whether the sale goes through auction or a traditional listing. A Glance at the Florida Auction Trend Asked whether we can expect an increase in auction demand here in Florida, Longly shared that auctions have increased gradually over a number of years and not necessarily because of the housing slow-down we’ve experienced in recent years. “While real estate auctions increased 46% from 2003 until 2007, the increase from 2006 until 2007 was only 5.3%,” he said. King says that his company traditionally represents non-distressed properties above $1,000,000. To meet increased demand from those now facing foreclosure, however, J.P. King recently opened an asset sales division through which they mainly serve new clients; banks and financial institutions with the sale of distressed properties. According to King, the number of condos sold at auction by his company increased 30% over the last year. He credits that increase to developers now being more open to finding alternative sales approaches in order to move inventory. King said that he anticipates an increase in business in the state of Florida this year. “We expect to do about 25% of our transactions in Florida,” he said. Quite a large percentage considering that his company is doing business in a total of 49 states. PINELLAS REALTOR® ORGANIZATION July 2008 21
Table of Contents Feed for the Digital Edition of PROView - July 2008 PROView - July 2008 Contents Chairman’s Notes Feature Story PROActive Making the Most of Your Membership Marketplace Analysis Home Sales Report MLS Update Brokerage Design MLS Mind Your Manners Calendar of Events & Programs New Members and Affiliate Members PROView - July 2008 PROView - July 2008 - PROView - July 2008 (Page Cover1) PROView - July 2008 - PROView - July 2008 (Page Cover2) PROView - July 2008 - Contents (Page 1) PROView - July 2008 - Chairman’s Notes (Page 2) PROView - July 2008 - Chairman’s Notes (Page 3) PROView - July 2008 - Feature Story (Page 4) PROView - July 2008 - Feature Story (Page 5) PROView - July 2008 - PROActive (Page 6) PROView - July 2008 - PROActive (Page 7) PROView - July 2008 - PROActive (Page 8) PROView - July 2008 - PROActive (Page 9) PROView - July 2008 - Making the Most of Your Membership (Page 10) PROView - July 2008 - Making the Most of Your Membership (Page 11) PROView - July 2008 - Marketplace Analysis (Page 12) PROView - July 2008 - Home Sales Report (Page 13) PROView - July 2008 - MLS Update (Page 14) PROView - July 2008 - Brokerage Design (Page 15) PROView - July 2008 - MLS Mind Your Manners (Page 16) PROView - July 2008 - Calendar of Events & Programs (Page 17) PROView - July 2008 - Calendar of Events & Programs (Page 18) PROView - July 2008 - Calendar of Events & Programs (Page 19) PROView - July 2008 - Calendar of Events & Programs (Page 20) PROView - July 2008 - Calendar of Events & Programs (Page 21) PROView - July 2008 - New Members and Affiliate Members (Page 22) PROView - July 2008 - New Members and Affiliate Members (Page 23) PROView - July 2008 - New Members and Affiliate Members (Page Cover3) PROView - July 2008 - New Members and Affiliate Members (Page Cover4)
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