NAPLES NEWS - Realtors Fume Over Property Auction
Some local real estate professionals are livid. It's bad enough that sales of single-family houses in the Naples area has dipped nearly 50 percent.
Now, an impending auction of 45 prime properties has locked up the market, Realtors contend.
An Oct. 29 cooperative open house in Countryside Golf & Country Club is an acceptable approach, but an auction scheduled for Oct. 21 at the Naples Beach Hotel & Golf Club has some Realtors seeing red, as in the bookkeeping term for financial loss.
While private auctioneers slowly have been injecting themselves into the real estate market in the past few years, the Oct. 21 event will be the first time in recent history that more than five Naples houses and condos - some waterfront - will be sold in this manner, said auctioneer Paul Drake, who is coordinating the event with JJ Manning.
However, the proposed auction has tied up the real estate market for the next few weeks, some Realtors protested in early October.
People have stopped buying so they can wait and see what they can pick up at the Oct. 21 sale, at which they can bid online or at the Naples Beach Hotel & Country Club for some 45 homes primarily in The Moorings, Lake Park, the northern boundaries of Old Naples and Cape Coral.
Drake's listings show the 45 upscale properties listed for a minimum of $1.
Real estate professionals say it is especially obnoxious because many of the properties that will be sold on the auction block - by seller desire, not because they can't pay the taxes - were purchased by speculators who likely attempted to manipulate the market.
"The majority of investors are selling off with little or no profits. Look at the 11 homes (in Lake Park) going up for auction by an investor now," says longtime Naples resident and Remax Elite real estate agent Jerry Krecicki.
John Turner, of John R. Wood Realtors, agrees wholeheartedly with Krecicki.
One of the sellers who signed up for the auction has 11 properties in Lake Park plus a few in the Moorings, and probably counted on Naples' continuing sales boon but - apparently - miscalculated, Turner said.
Noting that assessed value and sales price are a matter of public record, Turner cited a house at 1121 10th Ave. N. that listed for $569,000 on March 5, 2005. Moorings resident Marjorie S. Dresner bought the house on March 7, 2005, and closed on it on April 26, 2005.
For $585,000, Turner said.
Collier County Property Appraiser Abe Skinner had the house's appraised value listed as $450,726.
Likewise, a home at 1147 14th Ave. N. was listed for $625,000. Dresner bought it for $635,000 on June 10, 2005. Skinner has the assessed value listed as $563,933. On Oct. 2, Dresner sold it for $564,000, Turner said.
"She kept going around buying these (houses) and she was paying way too much for them," Turner said.
Dresner, who owns 26 of the 45 properties up for auction, could not be reached for comment.
Drake said Dresner didn't want to talk to a Daily News reporter about the auction, but said Dresner had indicated to him that the Oct. 21 event is a business decision.
"We are auctioning off everything she owns, except for her own home," Drake said.
Krecicki said when folks buy for more than the property is worth, they ultimately end up devaluing the neighborhood, he said.
"It's bad enough that we have a real estate market that is, as a whole, slowing down," Krecicki said. That kind of market manipulation is wrong, he said.
So much so that the Naples Area Board of Realtors wouldn't allow Drake to include his auction properties in the organization's multiple listing services.
"Everyone called up complaining. Realtors are in an uproar over this," Krecicki said.
Friday, Drake acknowledged that NABOR forced him to remove his homes for auction from the group's multiple listing services.
NABOR's bylaws state that auctions can't be included in the listings, Drake said.
Scheduled soon to open an office in Old Naples, Drake said he plans to function in the future primarily as an auctioneer. As a result, he downgraded his NABOR membership to "associate" and joined the Realtor Association of Fort Myers, he said.
But the Naples-area homes for auction have made it to the Web anyhow, he said.
"The ironic thing is that Fort Myers (realty association) has a data-sharing agreement with (NABOR), so in a couple of days all the listings were back in Naples," Drake said.
Drake is optimistic about the auction.
"It's been a tumultuous year for people in the industry," Drake said, speaking of real estate professionals. "An auction is just another option of selling (in) the market." Asked if the property owners who signed up to auction off their properties are hurting financially, Drake sidestepped the issue.
Noting that the 45 properties listed have 12 different sellers, he said folks such as Dresner basically saw the "logic and efficiency of selling at auction," he said. "That is what is attractive to the seller." It occurs at a predetermined time and place, and the property is sold "as is." Buyers have to put down 10 percent. If they do not buy the home, they lose their deposit, he said.
The primary difference between buying at auction and buying through a broker is that the buyer does his or her due diligence before, rather than after, the fact, Drake said.
True property value will be determined at the time of auction.
"The market will tell us," Drake said, adding that it just might improve the real estate climate.
"Nobody can deny that transactions are, arguably, down about 50 percent, and buyers are generally reluctant to make offers. They don't want to overpay. Or they feel the market will continue to decline," Drake said.
The auction could get buyers to start competing again, he said.
According to the Florida Association of Realtors, the number of Collier County houses sold in August was down 45 percent, from 472 to 259, from numbers released in August 2005. The median price of those houses slipped 6 percent from $500,000 in August 2005 to $469,100 two months ago.
Median sales prices in the Fort Myers-Cape Coral area were just as slippery; however, the number of homes sold didn't decrease as dramatically.
In August, sales prices slipped by 7 percent from the same period last year, decreasing from $283,600 to $264,100. Volume of sales slowed by 27 percent, from 966 in August 2005 to 702 two months ago. For the same period statewide, homes sold slipped by 27 percent, from 22,421 in August 2005 to 14,736 two months ago, but median sales prices remained level at $248,400.
A process real estate agents are willing to participate in is the Oct. 29 open house, said Talla Antonczak of Countryside Country Club Realty.
In addition to her agency, participating real estate companies include Blue Heron, Downing Frye, Gulf Breeze Realty, John R. Woods and Paradise Property of Naples.
Some 53 houses and condos in the Countryside development, a gated golf community off of Davis Boulevard, will conduct open house all on the same day, she said.
"Sales have gone down. People want their properties to sell. We feel coming together is going to make it better for everyone," Antonczak said. "This is a positive way to do something for the community and for real estate."
© 2006 Naples Daily News and NDN Productions. Published in Naples, Florida, USA by the E.W. Scripps Co.