Residential Real Estate Auctions

March was a month that took many real estate professionals by surprise. According to Austin Kilgore with Housing Wire, national housing sales rose 6.8% over February’s sales. The New York Times reported that the Western Region of the country did exceptionally well as sales rose 17%. Standard & Poor’s Case-Shiller Home Price Indices came out this week and showed that the overall home prices were up in the month of February.However, a report in Agent Genius Magazine says, “Where it gets mixed up is that despite this being the first time since 2006 that the annual rates of change for both [the 10-city and 20-city] composites are positive, more than half of the cities in the larger composite experienced price declines.”

Real estate professionals are speculating this recent uptick in sales is greatly due in part to the federal home buyer tax credit that expires at the end of April 2010. Prospective home buyers are moving off the sidelines to cash in on the low interest rates and potential $8,000-$6,500 tax incentive ending soon. However, Alan Ziebler reports “doubts remain about whether the momentum will be sustained in the second half of the year when federal support is gone.”

States such as California, are initiating their own home buyer’s tax credit in an attempt to maintain the momentum of residential real estate sales. According to the California Franchise Tax Board, “These tax credits are limited to the lesser of 5 percent of the purchase price or $10,000 for a qualified principal residence.” Though this incentive can provide eligible home buyers more than the federal tax credit, the California state tax credit will not last forever and is scheduled to end on August 1, 2011.

Obviously, there is a short window where buyers can capitalize on some real estate deals that probably won’t present themselves for several decades to come. Interest rates are at record lows and tax credits are offering those in a financial pinch a lot of help. The real estate market is overstocked with a supply of REO’s and short sales just waiting to get off the bank’s books. With so many factors piling up in the buyer’s favor, what else would it take to get more buyers to move forward with purchasing in the market?

Will the market continue its gradual stablization or will the real estate market take a double-dip once the government stops offering incentives? What are some of your market thoughts and speculations?

In this third post of our series on Using Online Auctions, I will discuss why online real estate auctions are a superior marketing tactic compared to traditional outcry auctions. The LFC Group of Companies is in a unique position to address this topic, having spent the majority of the last 30 years auction residential real estate, commercial property and land through an outcry format. However, after recognizing the shifting trend in commerce, LFC left outcry auctions behind to begin auctioning property exclusively online in 2004.

Here are a few reason why the outcry auction format falls short and why online auctions are the new industry standard:

• The Internet has a global reach, yielding the broadest possible market exposure.
• Bidders never need to leave home or work to attend the auction.
• Online auctions offer a fair and transparent process.
• All documentation can be downloaded electronically.
• LFC’s online auctions typically run 30-45 days, allowing all interested bidders to take their time and make an informed decision before placing a bid.
• Using the Internet as an open information source allows bidders to decide a property’s true real estate value for themselves.
• People are increasingly comfortable making purchases online.
• And best of all, no auctioneers are yelling and pressuring you as deliberate on one of the biggest financial decisions of your life.

Previous Posts in the Using Online Auction Series:

• Minimum Bids, Reserve Auctions, & Absolute Auctions
• Using Online Auctions: Busting the Auction Myth

Every time the LFC Group of Companies begins an online auction, I’ll write a blog post describing the city and region for that specific property. This requires some extensive research, which is often helped by the increasingly common social media presence of many towns across the country, both big and small. Towns like Spartanburg, South Carolina, Bemidji, Minnesota, and Paso Robles, California are doing a fantastic job utilizing social media to connect with local residents and visitors, and of course, simultaneously aiding real estate professionals like myself (a much appreciated unintended consequence!).

Take a look at the quality of material, the consistency in appearance across all of their accounts, and, most importantly, their engagement with followers/fans/viewers.

• Spartanburg, SC: Facebook Twitter YouTube Flickr
• Bemidji, MN: Facebook Twitter
• Paso Robles, CA: Facebook Twitter YouTube Delicious Flickr

Resources such as the chamber of commerce, visitor’s bureau or a city’s home page can be a huge help to better understanding all of our auction locations from a local’s perspective.

What are some of the ways your city is participating in social media? What do you like/dislike and why?Related Posts

• Coming Soon: Online Auction in Spartanburg, South Carolina
• Land Auction in Bemidji, MN: Bank-Owned Resort Development
• REO Auction for Land Parcels in Central California

In this next post in our Using Online Auctions series, I’ll dispel a common myth that real estate auctions are only suited for distressed properties. In fact, online auctions are perfectly suited for sellers with brand new properties. As you’ll see, online auctions are increasingly seen as an alternative marketing strategy, not a last resort option.

Sellers elect to auction properties and forgo a traditional real estate sale primarily because of one over-arching reason: auctions accelerate sales. Below are several characteristics of the online auction that ensure velocity of sale.

• The Bid Deadline
  • The Bid Deadline creates a sense of urgency for prospective buyers, getting all those fence-sitters in the game.
  • The Bid Deadline also lets everyone know that there is a certain date of sale.
• Focus Market Attention
  • LFC’s online auction campaigns feature aggressive marketing campaigns that grab buyer attention
• Global Reach
  • Online auctions have a global reach.
  • Bidders can perform all their due diligence and submit bids from anywhere in the world. Bidders no longer have to show up at a ballroom for a live, outcry auction.

Do you agree with these benefits of an online auction? Do you think using a conventional real estate sale is better? We would love to hear from you so please send us your comments.

The next post in our Using Online Auction Series will compare outcry auctions with online auctions.

Real estate auctions are the all the buzz these days, and there is a lot of auction vocabulary that can easily confuse people who are unfamiliar with the process. Given that the LFC Group of Companies has been conducting auctions for over 30 years, we decided to do a series of posts that can help clear up any confusion or misconceptions about auctions.

This is the first post in our series, Using Online Auctions. Today, we’re going to quicklysummarizeseveral different types of auctions.

1. Absolute Auction/No Reserve

• With an Absolute Auction, there is no reserve price, and the seller is obligated to accept the highest bid, no matter what the amount.

2. Minimum Bid

• The Minimum Bid is the least amount that you may initially bidfor a property.

3. Reserve Auction*

• A reserve auction means that the seller has the right toaccept, reject or counter the highest bid if it does not meet their reserve price. Note that the minimum bid is not always equal to the reserve price.

*On our online real estate auction website, FRE.com, the most common auctions are reserve auctions with minimum bids.

If anything is still unclear about the minimum bids, my post about lower minimum bids in our Ft. Lauderdale Auction might help further explain this integral aspect of online auctions.

Coming Soon

• Be on the lookout for our next post in this series: Debunking the myth that online auctions are only for distressed homes.

While taking on the responsibilities of social media for our company has become the highlight of my work, sometimes good old fashioned manual labor comes with the job of being the communications manager. I am also in charge of managing the majority of outdoor signage, and when we host auctions locally that means I get to do the advertisement installations myself.

I love working with my hands and being active, not to mention getting outside to enjoy the warm weather and California sunshine. On top of installing our company’s generic signs, the company founder and chairman is a huge advocate for any kind of guerrilla marketing we can implement into our auction advertising.

For example, I have had to go as far as putting up 40 directional signs for a single home during its open house and I have also designed advertisements for a truck to do some mobile marketing.

Some ideas work and others do not. But the beauty of Guerrilla marketing is that it’s cheap to do and does exactly what an advertisement is supposed to accomplish; to grab people’s attention.

Take a look at this ad I saw on http://billboardom.blogspot.com from a printer company in Paris, France Billboard for printer made with sheets of paper.

The City of Newport Beach is hosting its 101st Christmans Boat Parade this year and the parade does a u-turn right in front of the condos we are auctioning. We are allowed advertise on the seller’s yacht and I had a very interesting experience trying to get the signs up in a hurry.

Here are a couple of shots from the yacht ads but I want to know if you have done any crazy guerrilla advertising before! Should we have gone for more festive colors or maybe even added Christmas lights instead of our traditional yellow and black combo?

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About this author: Casey Flynn is the Communications Manager for the LFC Group of Companies. He also coauthors on CommercialAuctionListings.com and RealEstateNoteAuctions.com. You can follow his Twitter account @LFC_Auction.

We are happy to announce, in conjunction with Coldwell Banker, our latest Must Sell auction on FRE.com, two luxury condos in Newport Beach, CA. The auction has started and is currently accepting bids.

Being that Newport Beach is my home town, I am a little biased when I say this has been one of my favorite places I have ever lived. What is not to love about Southern California? These condos are only a few blocks from the Newport’s award-winning beaches and are situated right on Newport Harbor.

The first open house is scheduled for this Saturday, December 19th from 1:00PM to 4:00PM. Both properties will be open for visitors to mosey through and get a taste of what these one and two bedroom condos have to offer. But you don’t have to wait to see the photos. Simply head over to FRE.com.

The Bid Deadline is February 4th, 2010 @ 5:00 PM PST and while you may not have all the time in the world, we have sped up the due diligence process by posting all available materials and photos online for you to download.

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About this author: Casey Flynn is the Communications Manager for the LFC Group of Companies. He also coauthors on CommercialAuctionListings.com and RealEstateNoteAuctions.com

In a year when many traditional real estate companies struggled to survive, the LFC Group of Companies grew stronger, relying on their agility and versatility to launch several new programs and proving that their robust online auction platform can sell anything and everything, from high-end residential estates, to retail/office condos, to industrial/commercial properties, to vacant land, to former ski resorts.

LFC began 2009 with the auspicious launch of its revolutionary mortgage note auction website, BigBidder.com. Utilizing the same proven auction platform and technology behind the company’s residential and commercial real estate websites (FRE.com and LFC.com, respectively), BigBidder.com became the first website ever to auction individual mortgage notes, opening up the historically exclusive secondary market for notes to investors of all types. While several note auction websites have emerged in recent months, none can match BigBidder.com’s transparency, simplicity and diverse inventory.

In addition to BigBidder.com, LFC launched several new auction programs designed to help sellers and lenders in today’s turbulent market. On FRE.com, the Must Sell^® program was unveiled to help high-end homeowners and brokers achieve successful quick sales at maximum value. Must Sell^® came at a crucial time, just as the tidal wave of mortgage defaults began to hit luxury homeowners, and has since expanded to include assisting mortgage servicers with pre-foreclosure sales of high-end homes.

Our Director of Sales, Shawn Miller, said, “We’re constantly developing innovative new programs that allow us to adapt and grow in even the most adverse of market conditions. We saw where the market was going, where the next foreclosure crisis was coming from, and with the Must Sell® program, we were able to get ahead of the wave.”

LFC also launched their Never Lose a Listing^® program for commercial real estate brokers who are struggling to gain traction on their listings in today’s oversaturated market. With Never Lose a Listing^®, LFC has invited brokers and agents to utilize the company’s proven online auction platform to bring broad exposure to their properties. The program marks a new era of collaboration and partnerships between LFC and the brokerage community, including such national companies as CB Richard Ellis and Grubb & Ellis.

Throughout the years, LFC has proved time and again that the company can excel in good times and bad. “We will never rest when it comes to innovation,” said LFC’s Chairman William Lange. “We pride ourselves on our ability to adapt to the ever-changing real estate landscape. We’ve emerged from 2009 stronger and more versatile than ever before, and we look forward to another exciting and successful year in 2010.”

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About this author: James Gerber is the Public Relations Specialist for the LFC Group of Companies. He hails from New York, New York and also coauthors on CommercialAuctionListings.com and RealEstateNoteAuctions.com

Photo from WSD_GM at Flickr.com

Inman News posted an article back on Oct. 14 titled, The First Home Online. The article simply read:

“Who was the first person to post a for-sale home listing on the Internet? Inman News Publisher Brad Inman (@BradInman) posed the question in a Twitter post today.”

That being said, I don’t know who first listed their home online but I can narrow down speculations as to what inspired them to list online. Here is a list of the main reasons why I think the first person moved to an online listing format and away from the traditional classified ads:

• Online listings are an effective and alternative marketing tool for selling real estate
• By hosting listings in an online platform, prospective buyers have millions of listings right at their finger tips
• Buyers no longer have to travel to open houses across town, the country or the world to “visit” a property
• Listing your home online will act as a catalyst for speeding up the research on homes such as prices, sizes, photos, documentation, etc. before prospective buyers move forward with a visit to your property or talks with an agent.

It’s no secret that the internet reaches every far corner of the world and that the first step in researching anything is to “Google it.” Let’s face it, research has moved to the internet.

In turn, websites have become an essential for every company. However, websites do not replace the face-to-face interaction or having a tangible means of communication with someone involved in real estate.

Listing a home for sale online is crucial in order to maximize the property’s exposure when selling one’s home, and as the recession continues, I predict more and more companies will discontinue their traditional print ads to save money.

Why or why not would you list your home online?

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About this author: Casey Flynn is the Communications Manager for the LFC Group of Companies. He also coauthors on CommercialAuctionListings.com and RealEstateNoteAuctions.com

16 Genieve Harbor Ridge Real Estate Auction

Featured on the company’s residential auction website FRE.com, 16 Geneve, a well-appointed custom estate in Harbor Ridge, boasts spectacular ocean views and state-of-the-art amenities.

This exquisite custom estate home sits atop the guard-gated community of Harbor Ridge on a peaceful cul-de-sac, and offers one of the most breathtaking panoramic views in all of Newport Beach. Even in a town known for world-class ocean views, this home stands out, with stunning vistas of the city lights and Newport Harbor, not to mention nightly sunsets over the Pacific Ocean that defy description.

If the stunning views set the bar, the home’s impressive interior raises it, featuring four bedroom suites and eight bathrooms. The expansive Master Suite includes a spacious retreat, fireplace, two walk-in closets, and a palatial bathroom with marble countertops, heated floors and towel rack, as well as an enormous, computer-controlled shower and bathtub. The home’s well-appointed features include 5-inch Garrison® walnut plank floors, oversized picture windows, wood beam ceilings, exotic granite kitchen countertops, Viking® appliances and a built-in beverage center. The subterranean Bonus Room offers a comfortable sanctuary to entertain friends and family with a built-in bar, built-in flat screen TVs, 100 bottle wine storage and space for a pool table.

“Our recently-launched Must Sell® online auction program comes at a crucial time for Orange County real estate,” said Joe Rybus, Executive Vice President and Director of Residential Resales. “Although there has been an uptick in sales of moderately-priced homes, the high-end luxury market remains saturated and stagnant. Must Sell® combines aggressive marketing with universal reach to ensure each luxury home stands out from the crowd.”

Interested buyers of 16 Geneve, Harbor Ridge are encouraged to visit www.FRE.com/368D4 for specific property documentation, auction details and viewing schedule. The bid deadline is October 20, 2009.