That's right. There was this auction a couple of weeks ago for the remaining 30 units at Parkside of Alexandria. According to Cityfeet, the auction actually did better than expected. All of the units were gone in an hour!
Seeking to unload the 30 remaining condos at the 378-unit Parkside at Alexandria complex, Mid-City Urban put them out for auction last week. The results were better than the Silver Spring, MD-based development firm had expected: the units, which started at $225,000 sold within the hour at prices ranging from $288,000 to $362,000.
The $225,000 represented a significant discount from recent market trades. According to Delta Assoc., the price set before the auction--approximately $204 per sf for the three-bedroom homes, and $212 per sf for the two-bedroom units--is less than half the current average per-square-foot price of new condos in the Arlington/Alexandria area.
If they could move 30 condos within an hour, that is amazing. On the other hand, with the way market is heading, it does not look that the prices those buyers paid consider 'good buys' in any stretch of imagination. Think about it.
Based on market research using data from MRIS, sales of 2BR+ condo sold in the City of Alexandria from September 1, 2007 to date, shows a trend that prices paid were 4-5% off the asking price. Using the data and working backwards, we know that developer reserve price was $225k, you then add 4-5% to the reserve.. that should be the price paid. Then, it would be a steal.. er, good deal.
It's too late now for those buyers to get out from the contract. Because there's no way out when buying property from an auction!
The next time you want to buy property on auction, make sure that you prepare yourself. Do your home work. Check what properties been selling in the neighborhood. Plug in all the numbers to see a trend up or down. Then decide your own 'reserve' price. Don't buy on emotion. Stick to your game plan.