Times are changing and so is the market...
Updated: Sep 24, 2020
Two luxury real estate auctions in Santa Barbara
Earlier this month, 706 Park Lane was auctioned through Concierge Auctions following an unusual strategy - after years on and off the market, the sellers hired Concierge who started the auction in the usual way promoting the opportunity of the no reserve auction on a set date. Buyers were encouraged to register and make their opening bid. When the response was lackluster, and this 3+ acre Montecito estate only received one registered bid at $4.250M, they dropped the price online from $8.9 to $4.250M and that got people's attention. The property sold a week later for around $5m.
Then over the weekend, another auction was held live and hosted by DeCaro auctions for an estate in Hope Ranch. This property, 4558 Via Esperanza, had recently undergone an extensive remodel but was struggling to sell. Even after being offered as a no reserve auction, the response was tepid and there were only a handful of bidders on-site. With over $10M invested in this property, the highest bid was $6.2M and the buyer will be paying an additional 10% buyer’s premium making the price $6.82M.
"There is no doubt that auctions are exciting and create sales - however for both of these properties, the local knowledge will tell you, the market price was right in line with the auction prices and a realistic pricing strategy would have achieved the same result, most likely with lower costs to the buyer and seller."