Foreclosed homes going once, twice…sold

An auction of foreclosed homes Wednesday night at DeVos Place in Grand Rapids was a huge success, organizers said.

Sixty-six of the 73 homes on the auction block were sold for $2.4 million. That's an average of $36,363 per property.

The auction was put on by the Real Estate Disposition Corporation (REDC) , which has hosted four auctions in Michigan in the past week. One hundred forty-one homes sold for $6.44 million in Flint; 113 homes sold for $3.77 million in Detroit; and 59 homes sold for $1.83 million in Dearborn.

Organizers say the turnout at DeVos Place exceeded expectations.

"It's quite a bit larger than we expected here in Grand Rapids," said David Lee, one of the auction's organizers. "The interest has been terrific here in Michigan."

That interest may be in part because of the high number of foreclosures West Michigan has seen. More than 800 homes went into foreclosure in February alone.

"We're very sensitive to the fact that someone has lost their home for it to be on the auction block," Lee told 24 Hour News 8.

For Richard Morton, it meant a steal. He was the winning bidder for a home in Ravenna that sold for $77,000.

"(It's) a house on 15 acres, with a pole building, a mother-in-law's apartment, a pond on the property," Morton said. "It needs a little work, but for $77,000, the neighbor's house just sold for $410,000."

REDC says it established industry records in 2008 by auctioning 32,799 foreclosed homes for a total purchase price of $3.4 billion. Organizers of Wednesday's auction said they expect to sell twice as many homes on the auction block.

REDC CEO Jeff Frieden says now is the perfect time for a successful home auction.

"When you combine low interest rates with highly motivated sellers, in this case the banks, it has created a 'perfect storm' for home buyers," he said.

"This (auction) is the silver lining of the foreclosure issue that we're having in the United States," Lee added. "When they purchase a house next door to you that's been foreclosed for four to six months, it helps the neighborhood. It brings the property values back up."

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Real Estate Disposition Corporation