Bidding to build their dreams on foreclosures

At an auction yesterday of foreclosed homes, a Queen Village rowhouse valued at $525,000 went for $185,000; a $495,000 duplex in Brooklyn, N.Y., went for $140,000; and a stately five-bedroom stone house in Bucks County, valued at more than a million dollars, sold for $495,000.

Crowding the hectic and hurried event in Valley Forge were twentysomethings accompanied by their parents, and young couples herding toddlers - many hoping to grab a piece of the homeownership dream at half price. Others said they hoped to rent out the properties or sell at a profit.

With an explosion of foreclosures, this was a banner year for the firm running the auction - REDC, or Real Estate Disposition Corp. Its auctions skyrocketed from about 100 in 2007 to 303 this year, auction staff manager Shannon Wilkes said.

According to its publicist, REDC sold a record 25,500 foreclosed homes this year for a total of $2.9 billion. For each house, the company charges buyers a 5 percent fee.

The bulk of the foreclosures were in Florida, California, Phoenix and Las Vegas, Wilkes said. Philadelphia's real estate bubble never expanded to quite the spectacular proportions it did elsewhere.

Despite frigid weather, more than 300 people converged for the event at the Valley Forge Convention Center, competing for scarce parking spaces with a hugely popular gun show.

More than 100 properties were on the block, with each sale taking just a minute or two. In a machine-gun staccato, the auctioneer called out the bids as pictures of the foreclosed homes appeared on a screen.

Bidders flashed cards as three tuxedo-clad assistants scanning the room noted their bids, keeping up the energy and sense of urgency as they clapped and offered the occasional cheer for the highest offers.

The auctioneer sometimes called out "sold" and sometimes "sold upon approval by seller." Those who needed approval might still be turned down by the banks selling the houses, Wilkes said. Buyers would know within 15 days.

The houses would not be sold if the maximum bid didn't rise past a reserve value, she said, which was higher than the posted opening bids. But about halfway through the action, she said she expected 85 percent of the houses to be sold.