The auction event for Gallery is cancelled for tomorrow. Accelerated Marketing Partners, the auction company, sent an email this morning informing all the registered buyers that they are switching the auction event to an one day "Buy Now" event. This one day sales event is not available to the public. It's only available to buyers who registered for their auction event. I suspect they didn't have enough bidders for a robust auction but that is just my spider sense talking.
Registered buyers can visit the sale office in Gallery tomorrow at 2.00pm for the "Buy now" event. Each buyer will be assigned a number. This is on a first come first serve basis. The event will start at 2.30pm. A representative will be working with the buyer on an one to one basis and they will reveal the set price for the particular home that they're interested. So, don't expect to see a board broadcasting prices for all the homes. If you wish to proceed with the purchase, both parties will go into a purchase and sale agreement. Read more details here.
According to AMP, the set prices will be lower than the previous auction prices. Remember the last auction held on September 2009? Me neither so I looked it up and here is a list of prices for their first auction event. It does not include the final closed prices. The average price per square foot on the auctioned homes ranged from $267.59-$565.48, averaging around $430. I wonder how low they would go for their Buy Now event.
Let say we use one unit as an example, #615 is available for purchase. We know that #715 ( Open One bedroom and one bathroom, 596 sq.ft) was sold during their first auction event. It auctioned for $310,000 and closed for $302,640. If the Buy Now price for #615 is 10% lower than #715 at $272,376, would that be a good buy? Let's use two sold comps as a comparison.
1.) Cristalla #604 (One bedroom, one bathroom, 585 sqauare feet), a northeast corner home with city views sold for $260,000 on 11/29/2010. Even though Cristalla #604 is smaller and an older building, it's much nicer than Gallery and has an actual one bedroom and a better view. So at $272,376, Gallery #615 may not look attractive to me if I were a buyer. In other words, a 10% drop from the previous auction price is not enough to get me excited.
Let's take another comp.
2.) Mosler Lofts #603 (Open one bedroom, one bathroom, 585 square feet) has neighborhood views and was sold for $252,000 on 12/06/2010. Mosler Lofts and Gallery are both pretty new buildings. Even though Mosler Lofts #603 is slightly smaller, it has a better view than #615. So if Gallery #615 is priced at $272,376, it's still not a good buy.
So, it seems to me that if they price Gallery #615 at 10% lower than their previous auction unit (#715), I wouldn't get too excited. However, if the price is 20%+ lower than the 2009 auction price for this particular home, the numbers start to look more attractive.