As more properties in the metro area face foreclosures, banks are turning to auctions to try and make up some of their losses, and more prospective homebuyers are considering the option.
“Banks are anxious to get rid of the investment, said Crystal Wright, spokeswoman for real estate auctioneer Hudson & Marshall.
The Dallas-based firm is auctioning off more than 250 homes in the metro region this weekend, marking its second auction since October. The auction will take place on Saturday and Sunday at 1 p.m. at the Sheraton National Hotel in Arlington.
Buyers can “get a good piece of property at a great value,” said Wright, sometimes as much as 20 percent off the most-current list price.
Buyers can find lower prices at an auction, confirmed Linda Simpson, president of the Prince George’s Association of Realtors — an important consideration in a tight credit market where homeowners are qualifying only for smaller loans.
With a turnout last time of more than 2,500 people for about the same number of homes, Hudson & Marshall is hoping for an even better performance. Last time, about 70 percent of the houses were sold for an average price of between $175,000 and $200,000, according to principal Dave Webb. Webb is predicting closer to 80 percent of the homes will sell this weekend.
There are 313 properties listed across all of Maryland, Virginia, and D.C., including in Richmond, Baltimore and Norfolk, Va. Many of the foreclosures are in areas outside the Beltway, which have been hit hardest by the housing crisis, Simpson said. Of those listed, 80 have been presold to online bidders whose bid was approved by the banks.
In recent months, more prospective homeowners have been turning out for the auctions, which had been typically dominated by investors. In October, the ratio was about 50:50; Webb expects 60 to 70 percent of the attendees this weekend will be hopeful owner/occupants.
“Private auctions are becoming more mainstream,” Wright said. More of the properties are high-end, move-in-ready homes; as some recent foreclosed properties had adjustable-rate mortgages, not just subprime mortgages, Webb said.
But people should do their homework before the auction, Wright said. Hudson & Marshall is retaining agents with the lenders who put the houses up for auction, so buyers can preview the houses and get home inspections.
