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Homes for sale: Slump forces auction
Land, commercial properties are on the block as well
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It’s a problem that retail merchants deal with every year — when inventory gets too high, you have a sale.

For a number of years, real estate developers have had a steady stream of buyers. However, tighter credit policies have kept some buyers away from home ownership, leaving developers with too much real estate on their hands.

On Wednesday, a Rome auction company will sell homes, home sites and commercial properties in an auction at the Georgia Mountains Center.

J.L. Todd Auction Co. is conducting the liquidation of surplus property, much of it belonging to Cooley Custom Homes, a Gainesville developer.

"There’s a lot of builders, because of the market situation, are looking to reduce their inventories," said Frank Coker, associate broker with J.L. Todd. "The auction method has become such an accepted way of selling property because it’s quick and simple. It gives the builder an opportunity to put a large part of his inventory in front of the public at one time in one day."

The Wednesday sale includes both finished homes and undeveloped lots in the Oaks subdivision off Bob Bryant Road in southeast Hall County.

Also to be sold is a 55-acre subdivision on Eberhart Cemetery Road. The 14 lots will be offered individually, to be followed by a chance to purchase the entire tract.

Coker said that there will be opportunities for individuals to purchase a home at lower than market price.

"The prospective buyer should look at the home and then pre-qualify with a mortgage company or a bank. Then, they should be prepared to bid up to their price at the auction." Coker said.

The auction company requires a 20 percent down payment with the balance to be paid within 30 days. There is a 10 percent buyer’s premium on all purchases.

But Coker is quick to point out that the current situation is a buyer’s market.

"There are going to be some bargains at this auction," he said. "Property, especially building lots and houses, is bringing anywhere from 20 to 30 percent less than market value. Once the market corrects itself, which will probably be toward the end of 2008, the purchaser who saves that 25 or 30 percent will gain that back."

For Chris Cooley, owner of Cooley Custom Homes, it is a chance to move his inventory in a single day.

"This will help our company move surplus property," Cooley said. "The auction enables us to know the date our property will sell so we are free to move ahead with future plans."

Coker will hold similar builder liquidation sales in Winder, Villa Rica and Hiawassee in the next month.

"When the market gets kind of sour like this, there are a lot more sellers who call us to see if we can sell their property," he said. "Land and commercial property is still selling good. The only thing that is off is the housing market, and that, unfortunately, is the way it is right now."

The sale is scheduled to begin at 2 p.m. in meeting room A of the Georgia Mountains Center.