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The first major auction of property that has been sitting on the market for, in some cases, years, was held Sunday October 1 in the Wildwood Convention Center. I was there. I witnessed the bidding and sale of 8 of the 13 properties that were offered.
The first thing that stuck me was the number of people. There were a lot of people there and, it seemed, a lot of people registered to bid. I would have thought the bidding would have been spirited given those numbers but it was very limited.
The first properties that went up for auction were two townhouses that were originally on the market for 1,050,000 dollars each. Over the year or two that they were on the market the price fluctuated from that high to a low of 850,000 dollars until going back up to 1,050,000 before the auction. At auction the bidding started at 400,000 (for the fully furnished model) and rose fairly quickly to 700,000 and didnt move from there in spite of much coaxing by the auctioneer. That price is 66 per cent of the original price or said another way, thats 34 per cent below the original price.
The second of those townhouses was unfurnished but was identical in every other way. Bidding started at 400,000 and topped off at 650,000, 38 per cent below the original price.
Those were the best of the lot that I witnessed. Nothing else did that well.
Four condos that originally listed at 800,000 went in a similar manner but the starting bid was much less money. Each of the four started bidding at 200,000. Again bidding was very lackluster and the auctioneer often stopped to try to goose bidding by talking about the quality of construction and the great deal these prices were. The final selling price of each ranged from 475,000 to 440,000. That represents 41 to 45 off the original price.
There were two more sales that were even worse. These were much smaller condos at about 1300 square feet. One had an original listing price of 679,000 and that was sold for 300,000 or 56 per cent below the original price. The other one was originally price at 619,000 and that sold for 260,000 or 58 percent below the original price.
Theres another auction October 15 for 22 condos/townhouses in North Wildwood New Jersey. Many have a minimum bid of 375,000 others are offered with a reserve. I suspect many won't sell. The glut of condos in the Wildwoods is ridiculous. Some areas are going to be hit more than others and this is one area that will be hit hard.
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