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Doing a bit of research on Auction RE Sales

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Ray Miller

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Feb 20, 2002
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Licensed Appraiser
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Wisconsin
Just running around the internet a bit to day trying to establish how many homes sell at auction. The numbers are surprising me.

Williams and Williams an auction company out of Ok. Has it appears sold over 3000 homes in 2 years in Wisconsin. I think my count in the past two years there have been over 20,000 RE sales at auction in the state. Williams and Willams have another 30 listed on there web site for the next two months to sell. Couple that with all the other auction web sites, should we not new being considering the auction method a true and tested method to sell homes. Should not those numbers be listed and given standing in our data? That is also not counting the Sheriff auction sales. I end up with a combine number of around 40,000 homes/RE property sold at auction. No doubt I have missed some. There are a number of large national auctions firms working with in the state.

By the way you will not find those sales on MLS, you will need to research the auction web sites and the court house records to find the data.

How many appraiser take the time to research these kinds of sales??
 

Jan Roseberry

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Sep 25, 2002
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Ohio
In our local market, auctions account for just over 5% of total sale but almost 10% of the volume.

I keep advertisements, brochures for all farms over 30 acres. It's a real part of my market.
 

TEL2002

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Louisiana
Ray, are there tooooooo many auctioneers now, like there are too many appraisers???????????? I'm still thinking about going to the MO school.
 
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Colorado
There have been at least three auctions in Denver in the past three months -- most of the properties were REOs that didn't sell via the MLS, so it's off to auction they go. By not selling MLS, it means they are the worst of the worst -- at the auctions, most of these sold for 80-90% of the list price.

Do we as appraisers need to consider them? Of course -- they are another flavor of REOs, that push down the average sale price.
 

Ray Miller

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Feb 20, 2002
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Licensed Appraiser
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Wisconsin
Ray, are there tooooooo many auctioneers now, like there are too many appraisers???????????? I'm still thinking about going to the MO school.


Yes there are, but most don't practice. If you can find a nich area/market it is a good profession. It will make you some nice income. Got to get with the high dollar sales.

No brag just fact, I am working on three auctions for this spring, total gross sales will be some where around $1,750,000 the auctioneer gets some where around 10% or $170,000 less about 50% cost of doing business. So you will net pre tax $85,000 for you and your company. I am fast becomming a one man show for the most part. Just really tired of employees.
 

Terrel L. Shields

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Arkansas
Williams and Williams
The first really "big" house I did was a 400 ac. property with a 6800 SF house, auctioned in parcels and sold by Wm & Wm. East of Tulsa about 70 mi. It involved an owner who owned 16% undivided interest. A double wide MH for the ranch hand, a tennis court, private lake, and horse stables. I got to appraise the 'big' house and 2 of the tracts with an appraiser, the late Nolan Williams, probably the best and most honest appraiser i ever knew. BTW, it sold for about $300,000 (93), and the buyer ended up putting much of the land tracts back together and it resold for multiples of that a few years later. The house cost $300,000 to build in the early 80's when it was less than $45 per SF to build.

Most W & W sales I have seen are arm's length, well exposed to the market, and sell for market value. The above property was the cheapest I've seen simply due to the ownership issues as this involved litigation and was at a time when such a house was unique and totally uncommon for E. Oklahoma.

I cannot think and talk at the same time, especially in dollars, to be an auctioneer but I have a custom hat and a pair of Elephant boots so I could be a ringman :) ... Went to an auction of an old estate this past weekend. There were 2 old Weber wagons for sale. auctioned $1400, $1350, old dry harness several hundred, a really bad Fraizer saddle $375 (my saddlemaker buddy has just bought a GOOD JHHaney & Son saddle for $400 - he quit at $350.) An 1890 Winchester .22 short pump gun sold for $950, rusty, <50% bluing, and a Remington Rand made .45 auto sold for $1350. So I guess people still have money.
 

Ray Miller

Thread Starter
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Joined
Feb 20, 2002
Professional Status
Licensed Appraiser
State
Wisconsin
The first really "big" house I did was a 400 ac. property with a 6800 SF house, auctioned in parcels and sold by Wm & Wm. East of Tulsa about 70 mi. It involved an owner who owned 16% undivided interest. A double wide MH for the ranch hand, a tennis court, private lake, and horse stables. I got to appraise the 'big' house and 2 of the tracts with an appraiser, the late Nolan Williams, probably the best and most honest appraiser i ever knew. BTW, it sold for about $300,000 (93), and the buyer ended up putting much of the land tracts back together and it resold for multiples of that a few years later. The house cost $300,000 to build in the early 80's when it was less than $45 per SF to build.

Most W & W sales I have seen are arm's length, well exposed to the market, and sell for market value. The above property was the cheapest I've seen simply due to the ownership issues as this involved litigation and was at a time when such a house was unique and totally uncommon for E. Oklahoma.

I cannot think and talk at the same time, especially in dollars, to be an auctioneer not hard to do but I have a custom hat and a pair of Elephant boots so I could be a ringman :) ...tanks a bit more then that but you have a good start, come see me or drop over to Williams & Williams. Went to an auction of an old estate this past weekend. There were 2 old Weber wagons for sale. auctioned $1400, $1350, good buy old dry harness several hundred, a really bad Fraizer saddle $375 cheap for a colector (my saddlemaker buddy has just bought a GOOD JHHaney & Son saddle for $400 he made a good buy- he quit at $350.) An 1890 Winchester .22 short pump gun sold for $950, rusty, <50% bluing, Winchesters are going high now, check the out on the internet. and a Remington Rand made .45 auto sold for $1350. So I guess people still have money.
It appears they do. I did an auction a month ago where some things sold higher then it cost to buy them a year ago.


Williams and Williams is one of the best Auction outfits around the country. Mr. Williams is the President of the National Auctioneers Association this year.

He tells a story that at one time in his life all he had was two dimes to rub together and that he would be dead broke. Since then he has built this auction compnay to be one of the best.

As far as ringmen, we need a few more good ones. They can make or break an auction.

I understand from the articles I am reading that Williams & Williams are now buying up REO Property (they are taking the risk) from the banks and wall st. and reselling them at auction around the country. Visit there web site and just look at the number of listings and sold. www.williamsauctions.com
 

hastalavista

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Joined
May 16, 2005
Professional Status
Certified General Appraiser
State
California
Ray-

I just did two appraisals for a client of mine who bought two homes out of auction.

Just to give you some background on what I saw out here:
He paid about a 5% bidders premium.
He purchased the properties about 5% below market (and I used REO marketed sales and current low listings to do the appraisals).

These homes were purchased in 2006 for the $600k's, went into foreclosure this year with liens in the mid-$500k's, and sold at auction for below $400k. Based on my rental analysis, he's positive cash flow.

He asked me if I thought we'd hit bottom; I said no. But we both agree no one can time the bottom. What we do agree on is we are somewhere near the low in pricing (could fall another 10%-20%), but we are not near the low in timing (this could last another 2+ years). He plans to hold for 3+ years and wait till prices back up before he sells.

These are nice, 3-year old homes in a well-kept development with living area of 2,300 and 2,800sf. Some cosmetic deferred maintenance; new interior paint and flooring and ready to add to the rental market.
 
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