Comments on: Condos Go On the Auction Block

By: Ben_Kakimoto

Ben_Kakimoto — Thu, 24 Apr 2008 04:25:58 +0000

Apparently, auction goers got good deals with units going for less than the reserve price.

By: kent

kent — Sat, 19 Apr 2008 18:21:28 +0000

It seems like they want to see what the market is for all the units and make a decision based on where the prices go. They may hit reserves on some and not others, but make individual decisions based on the overall bids. eg. if they hit reserves on all but 3 or 4 units you can bet they will go lower on those just to get it over and done with. It seems like a smart way to go. This is the only way to find out what the real market is in times like these. It will be interesting for sure.

btw… great blog Ben, thanks for your efforts.

By: me

me — Fri, 18 Apr 2008 22:09:29 +0000

so what’s the purpose of having a reserve price if they’re going to take less than the reserve?

this thing has bait and switch written all over it

By: jerry K

jerry K — Fri, 18 Apr 2008 00:02:42 +0000

I have spoken to the auction people, and even if the price someone bids is BELOW the reserve, the offer will go to the owners, then they can choose whether or not to proceed with the sale. I hear they are motivated, so even if the price is below the reserve price, they will very likely take it. This is a beautiful project, and a chance to get a real bargain. I will be there.

I don’t agree with LonH. He needs to check value.

By: LonH

LonH — Thu, 17 Apr 2008 20:21:53 +0000

I am currently staying with friends at the 400. They are very nice. However, having lived in Bremerton/Kitsap County for almost 30 years, I can tell you the Minimum bid price is about what I would pay. There is a reason there are 28 vacant units left. Price being the reason.

If I could get in to one of these at close to the minimum bid price, it would be a fair deal to me.

However, the documentation specifically states the auctioneer will act on behalf of the seller to bid the price up to the “reserve” price and the seller does not have to accept any bid that does NOT meet or exceed the reserve price.

They make it appear the seller is motivated to sell the properties, but I think it is probably more marketing than necessity.

I will try to report back if I hear of any actual selling prices. The Kitsap Sun (www.kitsapsun.com) will more than likely cover teh auction as well.

By: Mike H

Mike H — Tue, 08 Apr 2008 02:04:24 +0000

And don’t forget the MONTHLY HOA dues. These range from $108 to $350/mth.

If you are in the market, these could be a good deal. They are doing it this way because the condo market in general is very slow. However, they are not going to give these away. The market will drive a fair value, but people need to make sure to do their homework and determine what a CURRENT fail price is and take into account the fees such as the 5% auction fee, closing costs, HOA dues, etc.

My suggestion is to do the homework, determine what you will pay for each unit then go to the auction with that in mind. If you get a good deal, you should get in just under what the current market bears and have equity building going forward.

Here is a good link with some sales prices to compare against.
http://www.condocompare.com/WA/Kitsap/Bremerton/West_Bremerton/West_Bremerton/98337/THE_400/condo_summary.aspx

Good luck!

By: Nancy Noble

Nancy Noble — Sun, 30 Mar 2008 02:07:34 +0000

Does anyone know what the relationship between the starting bid and the “hidden” reserve is? I mean why don’t they just start the bidding at $1 if the “hidden” reserve has already rendered the opening bid meaningless? I guess because the current owners want to keep the reserve hidden, it can only mean this really is just an elaborate marketing ploy. Boy, it really slaps any kind of truth in advertising principles right in the face. It seems the local news media is really lending a helping hand by throwing out the big hook for the auction co. by saying “Starting bids will be nearly 60% below the list price.” What a crock.

By: Ben_Kakimoto

Ben_Kakimoto — Wed, 26 Mar 2008 20:00:12 +0000

There is a reserve price on the units, according to the auctioneer’s website.

Specifics info about the auction process, reserve info, buyer premium and so forth are located in the downloadable PDF in the “Disclosures” section of the website.

http://www.redcpublicsale.com/

By: Jim Wells

Jim Wells — Wed, 26 Mar 2008 19:41:38 +0000

Is this an absolute auction?

I just read this above on your website, copied and pasted here: “I highly doubt this is anywhere close to the bargain it seems. All of the condos have undisclosed reserve prices that are above the starting bid price, I would guess by at least 50% or more. Additionally, there is a 5% auction commission on top of a winning bid. I suspect this is more of a marketing ploy than anything else, but it does seem to be working given the coverage it has gotten. The original prices are far too close to Seattle pricing for condos that are an hour ferry commute away.”

Is this true?

By: Sorin

Sorin — Wed, 26 Mar 2008 07:02:34 +0000

I highly doubt this is anywhere close to the bargain it seems. All of the condos have undisclosed reserve prices that are above the starting bid price, I would guess by at least 50% or more. Additionally, there is a 5% auction commission on top of a winning bid. I suspect this is more of a marketing ploy than anything else, but it does seem to be working given the coverage it has gotten. The original prices are far too close to Seattle pricing for condos that are an hour ferry commute away.