Homebid.com has announced the results of the world's first e-auction of privately held homes in the metropolitan Phoenix area, successfully completing a months-long campaign to woo brokers into trying something other than traditional MLS marketing methods. Homebid.com proposed that Phoenix-area brokers give-it-a-try approach with the resulting sales of over 31 homes valued at $6 million.

The e-auction held June 14th -17th, 1999, and sponsored by Coldwell Banker Success Realty, John Hall & Associates and Prudential Preferred Properties, was the public’s first opportunity to make offers on private homes over the Internet. Over 163 privately owned homes represented by real estate brokers were featured, ranging in price from $70,000 to $2.9 million. The average price of homes sold was $200,000.

"We are delighted with the response from the real estate and seller communities," said Kevin M. Hickey, president and CEO of homebid.com. "The results indicate that this is definitely a viable method of buying and selling homes. "

According to Hickey, many of the homes were sold during the "e-offer" phase of the homebid process -- the time period prior to the actual auction, when potential buyers can view the homes posted on homebid’s Web site and visit them for a first-hand walk-through. As homebid marketed the homes and anticipation of the e-auction increased, many buyers were moved to action, snapping up 10 homes only hours before the sale began.

Several participating real estate agents said the homebid auction spurred an upswing in interest during open houses held on the two weekends before the auction. Safe Karoubi, an associate broker with John Hall, said he was very happy with the number of bids he received during the auction. He added, "When I hold my own open houses, I am happy if ten people show up. homebid did such a good job marketing the homes in this auction that I had between 20 and 30 people attending my open houses."

One key to the success of the online auction was homebid's careful attention to overcoming buyer resistance to the concept. In addition to priming the pump with open houses, homebid offers potential buyers a complete online video tour of all the homes included in the auctions to help buyers eliminate homes and to choose which properties they are most interested in previewing before the auction takes place. Objections are minimized by property and pest inspections and preliminary title reports which are completed in advance of the auction.

Having those items done means that the brokers and sellers are clearly behind the concept of online auctions as a viable means of marketing homes to buyers. According to figures supplied by homebid, the large response in closed sales, is better than anticipated, since the most recent comparison that homebid had to go by was a HUD auction in which 137 homes sold for a total of $7.5 million. Homebid knows that its biggest PR chore will be in convincing sellers, buyers and brokers that the Internet is a great place to market beautiful, privately owned homes, and that auctions are no longer for distressed or repossessed properties.

"I think this fact validates the fact that homebid is not dealing with distressed or repo properties, but quality, beautiful houses," says Donald Case, spokesperson for homebid.

Buyers are getting their toes wet and finding they like the Internet waters just fine. Linda C. Meadows, a pharmaceutical researcher who is transferring from San Diego to Phoenix, found her dream home when she previewed the video tours on homebid’s Web site. After seeing the tour, she flew to Phoenix and quickly bought the house.

"It was nice to have the chance to look at the tour -- that was a big plus for me," Meadows said. "I felt like I knew exactly what I was looking at before I got there.’’

Targeting a few cities across the country, homebid.com will continue to "test the ground" under brokers' feet as they sell this new way of marketing homes as an adjunct to traditional MLS marketing. The next auction will be held mid-month in July, in Las Vegas, and the online auction will return to Phoenix for a repeat performance.

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Published: June 22, 1999

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