25 units were offered for sale by auctioneer JP. King. Some finished, others to be finished. There were about 60 people in the crowd, but the number of registered bidders was likely 25-30. The style of this auction was that the first ten units to sell would give the winning bidder the opportunity to choose the specific unit(s) they desire for the amount of the winning bid. This style of auction generally delivers the highest bid first, or early on, by a bidder that wants a specific unit and is willing to pay a premium for that choice.
All winning bids come with an additional 10% buyer premium. The first unit – #101 a finished 3bd/3ba 1915ft condo – received a high bid of $300,000, or $330,000 when you include the buyer premium. The second unit – #103 a finished 3bd/3ba 1915ft condo – received a high bid of $275,000, or $302,500 when you include the buyer premium. This was the high point of an auction.
The third unit – #205 an unfinished 1788ft condo – received a high bid of $200,000, or $220,000 when you include the buyer premium. The fourth unit – #102 an unfinished 1915ft condo – received a high bid of $190,000, or $209,000 with the buyer premium.
The fifth unit…. well, let me pause and offer what I observed. From the seller’s perspective this auction could only have been a failure.
By law, the auctioneer was required to sell 10 units “absolute” as it was advertised. And, that’s all they offered as the seller cut the auction short. With only 25-30 registered bidders (some of whom were there only to observe), the bidding velocity was lethargic. I’ve heard rumors that some auction companies will plant ringers in the audience to bolster bidding or to buy the remaining units the law requires to be sold. As it so happens, the fifth auction was won by a person willing to buy six units for his winning bid. This single bidder stopped the bleeding, and the 10 units required by law had been auctioned. In 45 days it will be interesting to check TCAD to see who closed.
Above is a video I took of the first auction. The bidding was so slow that I couldn’t even finish recording the entirety of the first auction before a wrangler, sensing an embarrassing situation, approached me and informed me I was not allowed to take pictures. No worries, buddy. 
What happened? Why the dismal bidding? You could speculate it was the wrong timing, a marginal auctioneer, marginal marketing, maybe it simply has to do with the location – it’s an hour drive from downtown Austin. From the seller’s perspective, I hope this generates a little momentum. From the buyers perspective, everyone got great deals, even at $330k. IMO, the exterior design of Waterstone is stunning.
The complete, short, result list can be downloaded here (.pdf).
-Jude
Tags: condo auction, real estate auction