Across the country, there is growing acceptance of the auction process, even among luxury developers.
In Boston, for example, several high-end condos have been auctioned off in the past year (not to mention the John Hancock tower!). But the real drama unfolds next month. That's when, for the first time as far as anyone there can remember, a posh, single-family home on Boston's famously blue-blood Beacon Hill will be put on the auction block.
One real estate agent in the neighborhood told Boston.com that both sellers and agents are keeping their fingers crossed for a successful sale of the property. "It might start a new trend," Sally Brewster says.
The Beacon Hill row house, on Brimmer Street, dates back to the 1860s. It was in run-down condition when it was purchased by developers Peter and Elizabeth Georgantas for $2 million back in 2006. The couple pumped some $4 million dollars into renovations, adding marble floors, a greenhouse and wine cellar.
At the time, of course, Boston, like the rest of the country, was still in the middle of a housing boom and the developers expected to fix the old house up and sell it for a hefty profit.
Or better yet, Pop!
We all know what happened next: the bursting of the housing bubble forced the developers to reduce (and, trust me, that's an understatement) their $9 million asking price down to just about $2 million.
But even at $2 million, there were no takers.
Hence, the auction.
it will be handled by Great Rock Auctions, a new company formed to capitalize on the auction trend. The opening bidding price of $5 million shows why auctions have become so popular: the often generate a higher price. (Something to do with the testosterone that a competitive biding situation brings out?)
There are plenty of Web sites advertising auctions for all sorts of distressed (foreclosed) homes, but what makes what is happening in the Boston area different is the auction process is being aimed at the top of the market.
"You are not looking for bottom feeders, " Jon Gollinger, of Accelerated Marketing Partners tells the Boston Globe."You are looking for people who don't want to overpay."
Of course, in this day and age, just finding people who can pay, is an achievement not to be taken lightly.
Charles Feldman is a journalist, media consultant and co-author of the book, "No Time to Think-The Menace of Media Speed and the 24-hour News Cycle." He has written about real estate and related matters for several years.