RISMedia, June 1 2011—Summer is renowned as the ‘vacation season’ where even thriving companies tend to slow down. Real estate is notoriously sluggish during the summer months, but with the consistently high number of foreclosures flooding the market, could this be a potentially lucrative season for real estate auctions?
According to last year’s data, PropertyAuction.com had a plethora of listings in summer 2010. The month of June saw 5,044 listings of both commercial and residential auctions combined, July came in at 5,649 total auctions, and August proved to be a very busy month with a total of 9,912 auctions listed. None of the summer months were at the bottom of the inventory list—the lowest amount of auction listings were in January, February and April, respectively.
It’s a well-known fact that the increasing foreclosure rate continues to depress the housing market. After last year’s robo-signing scandal, the foreclosures held back in 2010 are making a reappearance, which places a great burden on traditional sales. Msnbc.com reports, “foreclosures are expected to remain elevated through the year as homeowners contend with stubbornly high unemployment, tougher credit standards for refinancing and falling home values…The decline will push more borrowers underwater on their mortgages. Already, about one in five homeowners with a mortgage owe more than their home is worth.” Some could speculate that this can possibly trigger a substantial inventory of real estate auctions.
Dan Mahaney, accredited auctioneer of real estate, has seen that certain types of auctions excel at different times of the year. “Spring and fall are busy times for land sales. Fall is always the busiest time of the year. Sellers are looking to convert assets into cash before the end of the year,” he says. “It just seems there are never enough weekend sale dates in the fall to accommodate a seller’s request.” As for the summer months, Mahaney states, “Vacation homes always sell well during the peak summer travel months in destination locations. Colorado summer sales are always strong due to the increase in outside traffic, especially with buyers from Texas looking to escape the Texas heat. Midwest farm ground still appears to be the hottest asset in demand. Strong commodity prices make this a strong hold, at least for the time being.”
This proves to be true: Farmers National Company is already posting their June land auctions in Nebraska, Missouri and Iowa. On upper-tier listings, luxury property auction companies such as Grand Estates Auction Company, J.P. King, and Premiere Estates Auction Company each have several key properties slated for June.
In short, the summer season can still be a tough read for the real estate auction business even at mid-Spring, but as of now industry professionals are planning on keeping pretty busy.
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