By Mike Hill
I’m going out on a limb here, the limb that goes back to Jan. 20 of last year when I said “in a weakened economy and amidst alarmist headlines, Valdosta is nearly bullet-proof. Our only soft spot is the number of new houses from $150,000 to just over $200,000.”
I said the limited soft spot “will be there until local excess inventory disappears, which won’t be as long as it’ll take the excess inventory to be eaten up nationally.”
In the year, three months and 13 days since, what else did I say and what did I get right? In making semi-informed guesses about the future, how far out on the proverbial “limb” did I go?
On Feb. 3, 2008, I said that “…. except for too many new houses in a narrow price range, negative national housing news doesn’t apply here, except to the extent that it drives potential buyers to the sidelines.”
On March 23, I said that “Now that it’s commonly accepted that the real estate world is coming to an end and we’ll all die terrible financial deaths in our over-priced homes, national media is beginning to herald that, well ... maybe things aren’t that bad, except for speculators and the naive hopefuls who took on more than they could handle, with the connivance of lenders who should have known better.”
On April 6, I reported that then presidential candidate Senator John McCain said that paying little or nothing down can leave buyers owing more than their houses are worth and that tax dollars shouldn’t be used to bail out lenders.
On May 4, I said that real estate is tardy hitting its normal spring activity level and that the Associated Press quoted an expert who used 2007 Department of Labor statistics to name 24 metro areas as “recession-proof,” with Valdosta being the only one in Georgia.
I made a prediction on July 20 that “Both investors and homeowners will stop waiting on lower prices and get off the sidelines, first as a trickle and moving up to flood stage by early next spring, if not before.” (Is it early spring yet?)
July 27, the day after only my 29th birthday, I said that Valdosta didn’t have a bubble and that the bubble we didn’t have didn’t burst. I said it again on Oct. 5, that bubbles are created by limited supply and that if there were suddenly more buyers for $150,000 houses than houses of that price, I still wouldn’t be able to ask — and get — $200,000 for my $150,000 house. A scarcity of land might create that situation, but around here, developers and builders would just move on to the next cornfield and build more $150,000 houses to satisfy the demand.
On March 22 of this year, I said I didn’t know if it was spring-time optimism or little positive real estate nuggets I’m absorbing, but that I felt the market was taking the first little baby-steps to recovery — that our biggest local problem, besides listening to gloomy news, is that builders got ahead of the market in certain prices ranges — and that potential buyers waiting on lower prices better get in the game.
Then on March 22, I said MLS sales for the first 78 days of 2007, 2008 and 2009 didn’t show a collapse, that sales were 152 for ’07, increased significantly to 209 in ’08, then dropped to 129 for ’09, not shockingly under those of the first 78 days of ’07.
But forget predictions, we’re about to (drum roll, please) REALLY GET THE ANSWER on whether the local market is warming up with what Julian Cloud calls a “thermometer auction.” Cloud, owner and chief auctioneer of Professional Auctioneers, Inc. of Valdosta, says there’s no better way to test the market’s temperature than through an auction and he’s about to have one.
From the fall of 2004 until the spring of 2008, Professional Auctioneers very successfully sold a LOT of property for a lot of people. Cloud said it’s been a long stretch since the last auction, so this next auction on June 6, 2009, should provide a good test of the market. Some of the properties to be sold include a house and five acres in Brooks County, 19 acres in Lowndes County, five occupied rental houses, a couple of fixer-uppers, several building lots with access to Long Pond and several small acreage tracts, including Don Brotherton’s train track property.
Using a precise Southern measurement term, Cloud said there will also be a “passel” of antiques, tools and guns sold at the auction, which will be held at the American Legion Building on Williams Street. Starting at 10 a.m., Cloud begins with an explanation of the bidding procedure, briefly describes each auction property and answers any questions about each one. Greg Moore, his trusty lieutenant, and others roam the audience relaying bids and answering questions.
I was responsible for bringing a substantial number of properties to three of the 2004-2008 auctions when sellers left happy and top bidders left smiling, even if Cloud left only lint in their pockets. Most were rental properties that I managed, but one was a little concrete-block house and small lot on the water at Twin Lakes that set a record for price per front foot which I think still stands.
If you’re visualizing an auction chant too fast to follow, Cloud will only occasionally break it out, mostly for his own amusement. The rest of the time, the auction moves at a pace that’s neither confusing nor intimidating and if bidding slows, Cloud livens things up with comments like, “Folks, it’s only money.”
Even if you don’t intend to buy anything, the auction itself is interesting and entertaining enough to attend just for the experience, but if you really, really don’t want to spend any money — don’t take any money.
Mike Hill has been in the real estate business in Valdosta since 1976, and denies that his office staff and most of his relatives are putting him up for auction on June 6.