Real Estate Disposition Corporation Foreclosure Home Auction Part III

Today marks another auction occurring at the San Diego Convention Center. While I did not attend today's auction, I took a further look at the results from the last auction on August 18, 2007 concerning homes in Oceanside, CA:

1. No additional homes have closed escrow that were on the auction list

2. 3839 Vista Campana S. #32 in Oceanside's 55+ community of Oceana is still listed in the MLS since 6/8/07 now with an asking price of $164,900

3. 4477 Pala is still listed in the MLS since 6/6/07 now with an asking price of $244,500. Both are listed by the same broker and were taken off the market during the auction time, but then re-listed

4. With less than half the homes that were on the auction block actually sold, does that mean buyers are now avoiding the homes altogether, even with the low starting bid prices?

5. 488 Big Sky closed escrow yesterday with a sales price of $539,900. That's great they got their full asking price after being on the market 20 days, but the auction buyer has probably realized a loss of at least $14,000 and that is assuming the listing agent didn't take his commission of at least $10,000

6. And from the May 12, 2007 auction, 4306 Morgan Creek is still listed for sale, and has dropped their price about $75,000 from when it was first listed to it's current price range of $625,000-685,000. The house was bought for $649,000 at the auction! It's too bad that this home and the one on Deer Valley are in the River Ranch community which has seen some drastic price drops in the past couple months.

7. 4309 Deer Valley went in to escrow after being on the market only 10 days and priced at $479,000. The original May 12 auction price was $465,000, but that deal fell through and it was sold again Aug 18 for $415,000(including the 5% buyer's fee). This investor upgraded the house with travertine, tumbled marble, granite, paint, and carpet. Since this was a cash auction buyer, their cost to buy and sell is probably about $30,000. When you include the cost of upgrades and owning the home for a couple months, this one might be a break even deal.

I still think these investors would be better off consulting a local knowledgeable real estate professional to discuss the risk and reward of trying to flip properties in this market. They may be better off at this time considering other markets, probably outside of San Diego and Riverside Counties, or even in other states.