October 26, 2006
By I.M. Stackel - Naples News Staff
As seen in Naples News - October 26, 2006
Buyers and sellers have until midnight Friday to complete deals resulting from 45 potential sales in a property auction this past weekend in Naples.
None of the six Cape Coral lots drew interest during the auction at the Naples Beach Hotel & Golf Club in an event attended by about 450 people.
Most of the properties were in Naples residential neighborhoods.
About 450 people filled the resort's ballroom on Saturday morning, said Naples
auctioneer Paul Drake, who conducted the event.
"We had a good day," Drake said Wednesday when the auctioneer released some of the results of the weekend event. "We did our marketing and we got people out
Drake was under no legal obligation to disclose the bid prices to a Daily News
reporter, but did so Wednesday because of interest in the auction.
News of the auction created discussions around town during the past two weeks.
Issues raised included whether real estate professionals had been handcuffed by the event, with some contending that folks weren't buying until they saw what they could pick up at the auction.
Another issue was whether real estate speculators were losing momentum and dumping properties to survive the housing market downturn.
A third issue was whether homes worth hundreds of thousands of dollars could be
included in the area's multiple listing service for a minimum value of $1.
Drake has maintained all along that the market will determine the property value.
Naples Area Board of Realtors President Jo Carter said Wednesday her members
didn't object to the idea of an auction, only that the true property values weren't reflected in the opening price.
"Auctions are a positive for our business. It is one more activity ... just another way to sell," Carter said.
However, she said, she would like to see more realistic starting prices of each property.
While Carter didn't use any examples, there are numerous cases of homes valued
around $1 million, according to records obtained online from Collier County Property Appraiser Abe Skinner's Web site.
For instance, Skinner's records show that a 1430 Crayton Road property has a taxable value of $788,257.
Assuming the seller doesn't reject the high bidder's offer, someone will walk off with that Moorings home for $660,000, a price that includes the auction house's 10 percent commission, figures released Wednesday show.
It was purchased in March 1994 for $210,000 and resold in October 1998 for the same price.
Zillow.com, a national database of some 67 million properties, placed the house's value on Oct. 18 as $989,405.
At the other end of the spectrum is a home at 539 Rudder Road that was purchased
in April 1995 for $180,000; in April 2004 for $535,000; then resold in October 2004 for $809,000. Skinner's records show the property - which isn't homesteaded - has a taxable value of $933,269. Zillow showed the Oct. 18 value to be $1,390,180.
The top bid, or proposed contract price if the deal goes through, for that house was $671,000, Drake said.
After an auction, sellers have a few days to take or leave the offer, he said, differentiating between an "absolute" auction and a "reserve" auction.
Drake serves as the go-between.
"Absolute means it will sell for that price on that day," Drake explained, adding that he prefers absolute auctions and that "they draw three times (the number) of buyers."
Drake's next auction will likely be absolute, not reserve as this one has been, he said Wednesday.
A couple of scenarios can transpire until midnight Friday, Drake said. The seller could look at the high bid and say "no thanks," or could say "it's a little bit below reserve."
At that point the potential buyer, who handed over $10,000 in escrow, is under no obligation and the deposit is returned, Drake said.
"The seller is then back to square one," he said.
© 2006 Naples Daily News and NDN Productions. Published in Naples, Florida, USA by the E.W. Scripps Co.