Developers Use Auctions to Move Condos

When it's tough to set prices, these sales let buyers do it

By Katherine Thompson, Newser Staff

Posted Nov 28, 2008 1:22 PM CST

(Newser) – With buyers scarce and prices in Florida's condo market plunging, sellers are increasingly turning to auctions to move units in new developments. No longer just a means of unloading foreclosed homes, the auctions also keep agents from having to guess what the public is willing to shell out, the New York Times reports. “In this market, it’s not easy to determine value,” says one auction exec.

“It’s a win for the developer because he moves a lot of inventory quickly,” he adds. And it allows buyers to snap up bargains, while the competition reinforces the idea that such purchases are a good idea. But auctions won't solve everything: they only work if buyers are willing to bid beyond the minimum price.

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Luxury condos, located at The Heights of Carmel Valley, will be up for auction on Saturday, February 9th. Real Estate agents are relying more on auction to set property prices. (Photo: Business Wire)

The lavish condos at Adagio, located in the Las Vegas-Summerlin area, offer up to 3 bedrooms, 2 baths, and 1,362 square feet. Starting bids begin as low as $79,000. (Photo: Business Wire)

For buyers looking for a Florida real estate investment or a vacation home in the United States, Marlin Bay Yacht Club offers a fully staffed marina and turnkey luxury living. (Photo: Business Wire)

With housing prices in limbo, some developers find it easier to let their poential buyers set their prices directly by auctioning properities off. (AP Photo/Marco Ugarte)

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It’s a win for buyers because it shows that there is a market for the building—it gives them comfort in their purchase. - Jon Gollinger, co-founder of Accelerated Marketing Partners, which runs auctions

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Developers Use Auctions to Move Condos