AZ auction

Arizona Daily

There apparently is no shortage of deal seekers in the Green Valley real estate market.
Dozens of them turned out for Saturday's auction of nine new homes in Las Campanas Village. The house where the auction was held was packed with more than 100 bidders and spectators — so many that some had to sit outside on a patio and hear the action through a sliding-glass door.
But despite the rapid-fire chant from the auctioneer, the bidding came hesitantly and in increments of only $1,000 or so. Several of the winning bids landed around $140,000 plus a 10 percent auction premium. That's about $100,000 below the list prices for the two-bedroom homes, which ranged from about 1,680 to 1,760 square feet.
The developer, Mark Hughes, called it "a bad night in Las Vegas."
Retiree-oriented Green Valley, south of Tucson along Interstate 19, saw a surge of second-home buying and investment activity during the recent real estate boom, local real estate agents said. At the end of 2004, only about 200 homes were on the market, said Jack Woerner, a Coldwell Banker Success Southwest broker who tracks Green Valley listings.
But since the slowdown, the number of listings has soared to about 1,100, Woerner said.
"There's not really much of anything selling down here," said Hughes, who has 24 houses in Las Campanas Village that have been on the market about nine months. "This type of buyer does not have to buy."
Agents say part of the problem is a general slowdown in the second-home market. Some retirees who want to relocate to Green Valley are also having some trouble selling existing homes, especially in places such as Michigan, they said. And prices may have gotten too high too fast during the boom, they said.
Now prices are in retreat, and that's helping to bring back the buyers, agents said.
"Pricing is lower than it was back in the peak," said Gary Smith, an independent agent based in Tucson who is handling sales for Hughes. "People are getting good bargains, and there are a lot of properties to pick from."
Despite some buyers' difficulties selling homes in other markets, "the people are coming here to buy, still a goodly number coming with cash," said Steve Smith, president of the Green Valley Association of Realtors and no relation to Gary Smith.
But a drop in prices is not welcome news for some retirees who bought at the peak.
Winter resident Joe Morrow, who attended Saturday's auction, said his Green Valley house is probably worth about $150,000, compared with about $200,000 two years ago. Judging from the prices at the auction, he thought he might revise that estimate to the $120,000s or $130,000s.
Gary Beatty, an unsuccessful bidder on two properties, said he felt sorry for other buyers in the Las Campanas neighborhood who paid in the $230,000s or more. He bid about $137,000 on both tries on behalf of a brother. The winning bids were not much higher.
"This market is terrible right now," he said as he stood on the patio wearing a bright yellow hat, matching shorts and a backpack.
Hughes, the builder, said he probably will reduce the prices of his remaining houses based on the auction results. Only three of the houses, those that were "absolute" with no cancellation rights, were sold after the auction. Hughes made counteroffers for the other six.
The winning bids "were lower than I expected," he said.
● Christie Smythe covers real estate for the Star and writes a weekly column on the industry. Send news about commercial and residential real estate to her at Business, Arizona Daily Star, P.O. Box 26807, Tucson, AZ 85726; fax to 573-4144; or e-mail to csmythe@azstarnet.com.