Hudson & Marshall Came to town last week. This is an auction company based in Dallas Texas. Their primary focus is to facilitate the sale of residential foreclosures in bulk. Over the past couple of years here have been other real estate auctions but this one involved numerous listings in my company and it seemed to be particularly well publicized. I went in with an open mind.
My first request was to speak with a represerntative from Hudson & Marshall. In response they invited myself and several other Dickson Realty agents to join them in a conferance call for the purpose of training. In general they seem very professional, accomodating and agent friendly. They made it perfectly clear that there would not be any additional fees charged to the buyer should the buyer choose to be represented by a qualified agent. However, I would anticipate at least one additional fee added to all of these transaction and it’s likely to be labeled something along the lines of “auction premium”. In this case it was $5,000 across the board. Again this fee is charged to the Buyer regardless as to whether or not the Buyer brings his/her cooperating agent.
I found the conference call/training very helpful and stumbled into a very important fact. One that is not clearly explained in the H & M public information sites and brochure. The fact is there were no representatives from the bank(s) with the authority to sign offers at this auction. With that in mind I think most of the high bidders left feeling as if they purchased a home. In fact they had most likely purchased the right to negotiate directly with the Bank or their Asset Manager at some later date. Looking over the low numbers on these bids I’m pretty sure there will be more negotiations. I noted each winning bid while at the auction and plan to check MLS in 45 days to see which ones actually close and for what price. I will report the results at that time.
As a generality this would seem to be a fairly risky transaction from the buy-side point of view. They do not accept any contingencies (financing & inspections for example) and the buyers earnest money in considered non-refundable from the very point the purchase agreement is signed by all parties. It remains to be seen if the actual reward compensates for that risk. In the end I do hope this strategy works. We need all the help we can get in clearing out the “Bank Owned” inventory.
I will keep you posted.