Highlands housing auction attracts thousands of bargain hunters
December 5, 2008
By Jon Savelle
NEW — 9:22 p.m. Dec. 5, 2008
Imagine buying a brand new home in Issaquah for $89,000.
It is a price from a bygone era. Now, however, that same figure is the minimum bid for five new condominiums in the Issaquah Highlands that builder D.R. Horton will auction Dec. 7.
There are 18 units available in total, all in the Ashford condominiums at the Vista Park complex on 10th Avenue Northeast and Northeast High Street. Depending on size, starting bids for the others range from $99,000 to $129,000. At the $89,000 end, you get 580 square feet; for $129,000, you can stretch out in 1,059 square feet.
The units are part of a massive inventory reduction for Horton, which is auctioning 90 properties in eight communities around the state.
In Issaquah, any unit that sells at close to the minimum bid will be a great bargain. Horton sales manager Aaron Siverts, in the highlands office, said the regular prices for the condominiums would be $199,000 to $235,000.
The company is taking the auction approach simply to move inventory quickly and eliminate the carrying costs of unsold property, he said. There is no issue of foreclosure, distress or any other compromising condition.
“It is a great opportunity for buyers to take advantage of incredible deals,” he said.
Those buyers should be aware of some caveats. The Ashford property, under an agreement between Horton and highlands developer Port Blakely Communities, is subject to income qualifications for buyers and a price cap for sellers. This agreement, in turn, is subject to oversight by the city of Issaquah and A Regional Coalition for Housing.
According to Arthur Sullivan, program manager for ARCH, 10 percent of Horton’s highlands units must be affordable to buyers earning less than 80 percent of the region’s median income. Another 10 percent must be affordable to buyers earning 80 percent to 100 percent of median. And 10 percent must be affordable to those earning up to 120 percent of median.
“None are low income,” Sullivan said. “For a lot of them, that’s market price.”
That is true of the Ashford property, he added. All its sales are limited to buyers earning median income or up to 120 percent of it. And each unit has a maximum sale price, set by ARCH, plus restrictions on resale.
All of those conditions remain in place regardless of the method of sale — auction or otherwise, Sullivan said. If the auction price is less than the maximum allowed, the only one pinched is the seller.
Of course, no one knows what prices the units will bring. But if bargains are to be had, it will be individuals getting them, not nonprofit housing organizations. Marchelle Mertens, housing development associate at St. Andrew’s Housing Group in Issaquah, said it doesn’t have the resources for that kind of acquisition.
“That’s a lot of cash to have hanging around, for an organization buying a whole bunch,” she said.
And tenants of St. Andrew’s probably wouldn’t be able to swing a deal on short notice either.
“I doubt that any of the bidders would be affordable housing entities,” Mertens said. “But this is a wonderful opportunity for some people.”
Similar housing auctions are unheard of in the highlands, said Port Blakely spokeswoman Genni Reilly, who added she knows of no other builders who might be contemplating such a step, and there is no indication that the market is pushing that direction.
“We just finished an analysis of sales,” she said. “New home sales through October of this year, if the trend continues, will be 90 percent of 2007. We believe that, comparatively speaking, our new homes are continuing to hold their value.”
At the Horton sales office, Siverts said model units have been open to prospective bidders for nearly a month. The auction has been advertised on radio, television, the Internet and via e-mail, and some 2,000 people have come for a look.
Those who want to place bids must do so in person if they are Washington residents. Registration starts at 10 a.m. with the auction commencing at 11 in the Westin Seattle hotel, 1900 Fifth Ave. Out-of-state bidders may submit their bids online at www.auctiontoday.com. The site also has full details about the properties and auctions.
Reach Reporter Jon Savelle at 392-6434, ext. 234, or firstname.lastname@example.org.
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