Home Auction the next big thing

Home Auction the next big thing
Before long, going-going-gone may be as common as multiple listings
By DANIA AKKAD
Herald Salinas Bureau

Going once, going twice. Sold... by Auction: Houses

It should come as no surprise in an era when a grilled cheese sandwich bearing the image of the Virgin Mary sells for $28,000 on eBay that the Real Estate Market would turn to the Auction gavel.

What worked for the grilled cheese, say some Real Estate Investors and Agents, may just be the next big miracle in home sales.

"You know how you've always heard about some of these movie stars -- he's an overnight success after 20 years in the business?" said Ben Anderson of Anderson Auctions Inc., chairman of the National Association of Realtors Auction Forum. "The Auction is like that."

Last weekend in Florida's panhandle, where he works, Anderson held a live Auction for a 15-acre horse ranch. It sold in nine minutes.

"When you can generate that kind of a frenzy, a circus atmosphere," said Richard Freedkin, founder of Liquidation Events in Chicago, who lectures about Real Estate Auctions around the country, "you create a want, a mentality of 'If I don't buy it, they will.'"

And in a Real Estate Market that has slowed, Auctioning brings a new speed and fervor for owners who don't want to let their homes sit for weeks and months. That's what Bob Janssen is hoping.

On Sunday, Janssen's Abbey Management is auctioning off a home at 20 Santa Rosa Ave. in Salinas. He said the house appraised at more than $590,000. Starting bid is $429,500.

Janssen, who runs his company out of his Monterey home, has been investing in Real Estate for years and started auctioning homes in Utah, Oregon and Nevada, particularly in Las Vegas. This will be his first home Auction in Salinas.

"Some of (the houses) go at market price. Some of them go above market price," he said. "It just depends on who is drawn to the Auction."

Unlike Real Estate Agents, Janssen doesn't have a Real Estate License, but he said he does own a portion of the property. And that makes the Auction legal, said Tom Pool, spokesman for the California Department of Real Estate.

"If they are disposing of their own property," Pool said, "you don't need to be licensed."

The Auction has been advertised as a trustee sale, but Janssen said there is no bankruptcy or foreclosure involved with the Salinas house. Abbey Management is the trustee, he said, but he was unclear who the trustor was and said he would have to look at some documents to figure that out.

Janssen initially advertised that he would be giving a portion of the proceeds to the Make-A-Wish Foundation, but on Wednesday, Greater Bay Area Make-A-Wish Foundation Executive Director Patricia Wilson said they had no idea Janssen was planning on donating money to the organization -- or using its name in advertisements and on Abbey Management's Web site.

"This is a first. This is just unprecedented," Wilson said.

Janssen said he didn't realize he needed to fill out agreements with the organization to use its name and give donations. He was just trying to be a nice guy, he said.

"It was really a passing comment that I wanted to make a contribution towards them," he said.

He has since decided to donate a portion of the sale proceeds to the Sally Griffin Active Living Center in Pacific Grove, where he and his wife are members. On Thursday, they held a Pre-Auction Party and presented a check to the center's Executive Director, Vivica Lohr.

Today and Sunday, Janssen will hold an open house at the home from noon to 5 p.m. Then at 6 p.m. Sunday, a round-robin Phone Auction will begin. The final price remains to be seen.

What does look promising, said Freedkin and Anderson, is the future of this kind of auction in the industry.

Anderson said the National Association of Realtors and the National Auctioneers Association are now working together to create programs to develop the process, and many Real Estate Agents and Brokers may choose in the not-too-distant future to add Auctioneering as a specialty in their sales arsenal.

"Not every seller is suitable for an Auction. Not every buyer will go through that process and not every property is right for the process," he said. "You just have to find the right blend."