Real estate auction activity continues to thrive. In today’s tumultuous economy, both residential and commercial properties are selling in droves via auction.
According to PropertyAuction.com, the number of auctions posted on their site has almost doubled in 2011. From January to September, 99,924 residential, commercial and land auctions have been listed. Compare that with 52,404 during the same time period in 2010.
And it’s not just foreclosed homes. As CCIM Institute reports, “Auctions are gaining popularity as an effective sales strategy for all types of commercial real estate. For instance, the number of industrial property auctions is increasing as companies divest themselves of surplus space resulting from the volatile economy…even multifamily real estate is garnering record sales prices at auctions as investment yield rates fall and condominium conversions drive up selling prices.”
True as this is, it does differ from state to state. Take the Southeast—always a hotbed of real estate activity, the auction sector in this area is persistently ripe with inventory. According to Bret Richards, auctioneer, CAI, auctioneer and sales manager with Hudson & Marshall, the South remains in the thick of the auction action. “We’re seeing a lot of auction activity in the Southeast, such as Florida and Georgia,” Richards states. “It’s all very market- and property-driven. For example, if you’ve got a lot of condos in Florida, you may have a good shot at getting those moved. If you have them in Chicago, it may be a little tougher right now.”
In the case of Florida, the foreclosure rate only strengthens the number of real estate auctions. An article written in The New York Times reports, “The state routinely sets new records for foreclosures.” Georgia is also burgeoning with real estate auctions. According to PropertyAuction.com, Georgia led the number of auction posts to date in 2011 with a record 12,080 auctions.
Yet, believe it or not, there are actually some states that are currently seeing movement in the traditional real estate market, such as Washington, D.C.
According to PropertyAuction.com’s numbers, postings from states such as New York, New Jersey and Massachusetts barely hit double digits this year during the May – August 2011 period. Connecticut topped out at six, and Rhode Island didn’t have any posted auctions for two of the three months in that time frame.
One thing is clear: The auction method of sale is being utilized consistently in the real estate industry as a lucrative option for sellers and investors. According to Richards, “We think there’s going to continue to be more auctions and more opportunities. We haven’t heard any indication that it’s over by any means.”
