RISMEDIA, February 13, 2010—(MCT)-In a move that could speed the sale of massive numbers of distressed properties on the market, Miami-Dade County recently launched online bidding for foreclosures, bringing together bidders from across the globe and launching hopes of an accelerated return to normalcy in the real estate industry.
The new system, managed by Plantation-based RealAuction.com, will completely replace the traditional courthouse procedure, and is expected to save the county $750,000 annually while cutting out a lot of the paperwork that has weighed down the process, said Miami-Dade Clerk of Courts Harvey Ruvin. The move comes at a time of high anxiety at the foreclosure division of Miami-Dade Clerk of Courts office, as it tries to balance a ballooning backlog of foreclosure cases and a slashed budget.
“This couldn’t be happening at a better time for us,” Ruvin said. “We are in an enormous avalanche of foreclosures. We have over 110,000 open foreclosure files, with an additional 7,000 coming in each month.” Ruvin says the new online system—capable of handling four times as many auctions per week as the courthouse—will help reduce the troublesome backlog.
Foreclosure-ravaged Florida is the first state to adopt an online auction system for distressed properties, using the software in nine counties, with three more to be added by March, 2010. The state has sold more than 20,000 homes via Internet auction since 2008, when the Legislature changed the law to allow for online public sales, said Lloyd McClelland, CEO of RealAuction.com.
In the months ahead, the county’s online auction could sell as many as 2,000 properties per week, compared to the 450 homes the courthouse procedures regularly logged, allowing the county to reduce its caseload. Since the program needs minimal human maintenance, most of the 23 employees dedicated to running the traditional auction process will be redeployed to attend to other areas of the foreclosure process, Ruvin said.
In order to participate, potential buyers have to register at http://www.miamidade.realforeclose.com. Registration is free, and once bidders have completed this step, they can access thousands of foreclosed properties, view pictures, link to a property appraiser’s report, take a street-level virtual tour of the neighborhood and check a profile on Zillow.com. To get started, bidders have to put down a refundable 5% deposit—which can be paid online or in person. After entering a maximum bid, they can let their computer take over and bid on their behalf, or monitor the auction and bid manually.
With home prices in Miami-Dade down by more than 18% since last year, people from other parts of the U.S. and the globe are looking to take advantage of the Web’s portability to score a bargain. “The word is out,” Ruvin said. “This has gone global—we’re getting acknowledgment and bidders that are registering from all over the world. That just opens the universe to our process. We hope to have more people competing; therefore the prices will go up.” The site has seen visitors from dozens of countries, including Australia, Jordan and India, McClendon said.
Julian Dominguez, president of Foreclosure Investment Systems and a regular at county courthouse auctions, said the online setting will make the process more pleasant for first-timers by preventing courtroom bullies from using intimidation tactics. “We have people that have created a level of stress across the system by their actions,” Dominguez said of the traditional auction process. “It just created a tense atmosphere for those that came new, and we’re looking for the new system to help with that.”
Miami-Dade County has one of the highest foreclosure rates in the country and is the largest metropolitan area to adopt the online auction procedure so far.
(c) 2010, The Miami Herald.
Distributed by McClatchy-Tribune Information Services.
