Property Auctions

I would be interested in knowing how low these sellers are expected to go and the tone of your posts High, makes me think that pressure is now being exerted on them to take these really lowball offers. Regarding that beachfront lot, I got a buyer looking for a beachfront lot under $2 million about 4 weeks ago. I think that was his request but would have to check with realtor that I gave the lead to. If there are buyers out there looking for beachfront under $2 million, I'm gonna scream if that seller takes $1.25 :bang: :bang: :bang: because then this auction process is devaluing our properties. Tell me that's not the deal you're still working on High :banging:

Good morning, Cork.

Rest easy. It's not. You can also rest easy on the pressure issue. It may be overstated somewhat, but I don't want to get into that now. I think anyone in attendance Saturday will vouch for us on the pressure issue, or the lack thereof.

Let's talk about "WHY" we believe much of the nation's real estate, especially residential, is about to experience a serious readjustment in value. It's really quite simple.


The US economy has experienced significant economic growth since 1982 thanks to Ronnie & Bill (Reagan & Gates). After the S&L/RTC fiasco in the late 80s most people invested heavily in the stock market.

"Put your money in business! Support your nation's economic growth!"

Thru the 90s we had solid growth in the stock market, moderated by several adjustments, both large & small, and capped by the dot.com bust. In spite of the adjustments most people improved their financial condition thru that time period. Investors started putting significant amounts of money into land and improved real estate.

"Buy Land! They're not making it anymore!"

Due to the availability of wealth generated by Ronnie & Bill, many people "invested" in vacation homes and recreational lands. This was a good thing at first, but hype and speculation set in following the inital phase of investing. The impending rapid and unsustainable growth was fueled by low interest rates, interest only loans, IRS incentives, and the hype of everyone even remotely related to the business of real estate marketing and mortgage/money marketing.

Our nation's media fueled the fire by reporting on the stability, growth, and profit potential in the real estate market. "Flippers" started buying and selling land (often without ever having closed) at prices supported primarily by the previous transaction values and the anticipation that land values do not go down, but only go up. How soon we forget. Remember the day-trading frenzy in the dot-com scenario? The flippers are different only in the particular commodity that they are trading. The demand for these properties was created by people wanting to make a profit (artificial demand), not by people wanting to take up permanent residence (real demand). Hot Potato. Who's holding it?

Cheap money also became easy money. People buying on credit often weren't concerned about the cost of the asset, but the amount of the payment. They anticipated an unabated appreciation in value as justification for the additional expense. As interest rates increase, many buyers who anticipated a better personal financial condition five years down the road are finding that they have no more cash than before, and the note payments are rapidly increasing. The interest only loans are starting to mature or transition into P&I.

With an increase in interest rates you have an inverse reaction in property values. How often have we qualified a buyer based on what he/she can "afford"? (I don't care what it cost, just tell me how much the payments are.)

The two types of owners indicated above will be our (the real estate licensee's) sellers. They bought wrong, or at the wrong time. Unfortunately there are far too many of them to be able to reallocate the assets without significant adjustments in R/E values.

You don't make money when you sell, you only make money when you buy.

I'm throwing this in here for a little fun.

On Feb. 28th, a 2 year old Thouroughbred was sold at auction for $16 million at the Fasig Tipton Florida 2 yr. old in training auction. Average sale price was $403,812. That is basically a $16 million dollar lottery ticket purchased at auction.

I could buy a few Sowal parcels for $16 mil?

I'm throwing this in here for a little fun.

On Feb. 28th, a 2 year old Thouroughbred was sold at auction for $16 million at the Fasig Tipton Florida 2 yr. old in training auction. Average sale price was $403,812. That is basically a $16 million dollar lottery ticket purchased at auction.

I could buy a few Sowal parcels for $16 mil?

Yeah, we saw that but heard it was a 4-year-old. We're horse people, too. How screwed up are we?

Yeah, we saw that but heard it was a 4-year-old. We're horse people, too. How screwed up are we?

Nope - he's a baby- it was the 2 year old in training sale at Calder. Guess it's a bit better than paying that price for a yearling.


Being from KY, thoroughbred auction prices don't totally surprise me anymore. Doesn't everybody have $16 mil to spend on a horse??:floor:

Nope - he's a baby- it was the 2 year old in training sale at Calder. Guess it's a bit better than paying that price for a yearling.


Being from KY, thoroughbred auction prices don't totally surprise me anymore. Doesn't everybody have $16 mil to spend on a horse??:floor:

Neigh!!!! 😀

Hi high (love that 😀 )

I don't have any real problems with the auction process because as you say it's nothing new. I do have problems with the language that the company's website uses regarding exerting persistent psycholigical pressure or something like that. Also language about the frenzied environment creating an illusion (wrong word) of an impending sale. First, I'd have concerns about allegations of undue pressure and secondly I don't pressure any buyer into a sale because its just too important of a decision to make under any sort of pressure. That's my primary beef with the marketing.and/or process.

I have not been to their website, but I can tell you that purchases made under pressure, or in a frenzied environment are not recognized as normal conditions and therefore, do not classify as true "market value."

Cheap money also became easy money. People buying on credit often weren't concerned about the cost of the asset, but the amount of the payment.

Very good comments, High. I have lots of clients in the car and boat biz and they relate similar comments- it's all about the payment. Pick up a major city weekend newspaper and look at the big dealer ads- most pimp the monthly payment, not price of car. And most are leases.

I think overall many Americans have become "cash flow purchasers", only looking at monthly outgo vs inflow. The media and the lenders encourage this, unfortunatley. Most times a loan officer is not looking at your financial situation from any other angle than "how can I juggle the #s to get you qualified and into that house/boat/car so I can make my fee".

That creates a tightrope effect- ie: with a small change in either income or outgo, you will see a much larger spike in delinquency, BK, etc. I suspect there are owners on the Gulf right now where the numbers dont work anymore once you factor in higher insurance, monthly note, etc. Not the majority, but a few.

There will be a rebalancing, not a crash, and there will be "investors" at the margins caught in the squeeze. That will create opportunities for the rest of us, and create more business for Mr. High Bidder, IMO.

I suspect in a great place like SoWal, however, those bargains will be snapped up quickly. There will be opportunity until supply/demand rebalances. The good thing for SoWal is that due to demo trends, boomers, QOL, etc, the demand should continue to be good. Not speculative, perhaps, but good long term.

Affordable Housing In South Walton?

Maybe this Bubble Bursting in So Wal, will allow for some substantial Section 8 housing projects to take hold. Maybe Dune Allen.

Critics of Seaside, say that it is too artificial, surreal, perfect. Solution: slap a 32 story, 300 unit HUD 'project' in there at the town center ampitheater.

Affordable Housing In South Walton?

Maybe this Bubble Bursting in So Wal, will allow for some substantial Section 8 housing projects to take hold. Maybe Dune Allen.

Critics of Seaside, say that it is too artificial, surreal, perfect. Solution: slap a 32 story, 300 unit HUD 'project' in there at the town center ampitheater.

Sounds like you think that SoWal consists of only property along 30A. There is plenty of undeveloped land "stuck" in areas with low densities, which would be very suitable for affordable housing rental units. FYI- just because it is affordable, that does not degrade the level of the people living there, nor does it have to be bland in character.

Sounds like you think that SoWal consists of only property along 30A. There is plenty of undeveloped land "stuck" in areas with low densities, which would be very suitable for affordable housing rental units. FYI- just because it is affordable, that does not degrade the level of the people living there, nor does it have to be bland in character.

c'mon joe, you know sowal is really only the property below 98 :roll:

Hi high (love that 😀 )

I don't have any real problems with the auction process because as you say it's nothing new. I do have problems with the language that the company's website uses regarding exerting persistent psycholigical pressure or something like that. Also language about the frenzied environment creating an illusion (wrong word) of an impending sale. First, I'd have concerns about allegations of undue pressure and secondly I don't pressure any buyer into a sale because its just too important of a decision to make under any sort of pressure. That's my primary beef with the marketing.and/or process. ..........

Exactly.:blink: The website makes me cringe.

Reading HighBidder's posts has helped and been informative. Yet the website seems so different in tone from the posts. :idontno:

I have been to auctions for boats, cars, etc where once you jump in with a bid, one of the bidding assistants (or whatever they call them) runs over to you and literally gets in your face yelling and cajoling, using all sorts of
pressure to get you to bid higher. If you dont stick to your predetermined
limits, it's easy to get caught up in the hype....

Joe, then the last 5 years here were not normal. You could not get a counter offer back fast enough to the seller before they raised the selling price.

:floor:

Affordable Housing In South Walton?

Maybe this Bubble Bursting in So Wal, will allow for some substantial Section 8 housing projects to take hold. Maybe Dune Allen.

Critics of Seaside, say that it is too artificial, surreal, perfect. Solution: slap a 32 story, 300 unit HUD 'project' in there at the town center ampitheater.

:floor: :floor: :floor: :floor: