Earlier this week The Oregonian did a quick write up regarding the auction and reserve pricing. I’m certainly glad that they are willing to help shed some light on this auction, although I don’t think it is very accurate to compare this auction to an E-Bay auction, or a car purchase. A home purchase is the single largest purchase and investment that most people make in their lifetime, and without the proper due diligence can have disasterous effects on finances, future security, and long term personal well being. We all expect to “lose out” occasionally on an E-Bay purchase, or even a car or larger retail purchase, but those poor decisions or “lemons” don’t have nearly the disasterous effects that rushing into a home purchase could have. Most people can’t afford the risk of moving into a lemon of a house, and without following due dilligence guidelines a home buyer could be at a tremendous risk for loss. And don’t forget, homeownership comes with tax benefits and consequences that could possibly come into play when trying to bail out of a bad situation.

It should also be brought up that traditionally home auctions usually involve foreclosed or distressed properties and attract mostly investors, who are more experience and savvy. My gravest concern with a new construction auction is that it most likely attracts homeowners that intend to make the new purchase their personal residence, and don’t typically have the means to bail themselves out of a lemon purchase, as most serious investors do.

Please feel free to leave comments or ask questions. I’ve included the above comments in my most recent update on my original auction post below.

Opinions expressed in this article are the opinions of author, and not to necessarily the opinions of Meadows Group Inc.
All rights reserved on all original content, non-original content is given credit | Michelle Berry | 2009