Auction Carnival
Tuesday, June 26th, 2007In an atmosphere of carnival fun the auction proceeds in a packed room. In a fast and furious pace a three bedroom condo in South San Francisco is snapped up for $425,000. Over 2,300 people had crowded in. ‘Ringmen’ in tuxedos were managing the show. One even did a jig whenever there was a bid. Black and white clad women ‘runners’ clapped and cheered while rushing around with paper and board. Some sold out in two minutes with only four bidders. All the while snack dealers made hay while the accompanying children played around in the sun outside.
That was only one of the 88 properties up for foreclosure mostly in the Counties of Alameda, Contra Costa and Solana. In a decade there had not been the likes of such a large-scale show in the foreclosure field. There was no doubt that the rising tidal waves were lashing the Bay Area also.
The company conducting the auction, had been hibernating for the last ten years. The market was too hot. But now they were hot on the trails of a cooling market and making up for lost time. In the matter of a month they had auctioned off 290 foreclosed properties in Southern California. They were now on a hurricane tour of the county, knee-deep in the foreclosure crisis. Financial institutions are selling off their properties via the auction route on the reasoning that a quick sale is better than a slow one. Losses can be repaired as against time that never comes back.
The game plan was that each property had declared a minimum bid but there was a y secret reserve price. The latter was the minimum acceptable to the banks. Bids below the actual reserve price were given the denial notice within a week. The rates were fine for those who want to live in it but not tempting enough for investors.
Bidders had to bring $5,000 cashier’s cheque. The top bidder was expected to put down 5% of the bid price and sign over the cashier’s cheque together with the personal cheque for the balance. A 5% buyers fee has to be paid to defray costs. The realtors get a seller’s fee. The difference between foreclosure and county auctions is that the latter is out of reach of the common man because it requires all payments in cash. Moreover the title deeds may or may not be clear.
