Downtown Jersey City. Nestled on Newark Ave, just a short walking distance to the Grove St PATH, and on restaurant row, The Saffron, built by Fields Development Group, a brand new construction project of modern condominium residences is now almost complete and Sheldon Good & Company has started advertising that it's auctioning it's first few residences off to the highest bidder. Opening bids will start at $175,000 for 1 bedrooms and $250,000 for two bedrooms. This brand new building offers all new, never lived in units some with terraces and views, all have modern kitchens and bath with stainless appliances, washer and dryer in unit, bamboo flooring and a shared gym, lounge and roof top deck. The project is split up into two buildings, sharing a very modern chic lobby with earthy elements, the Newark building and The Maxwell. The units are actually pretty nice, however some are a bit small and don't offer much of a living room. They're also very modern, so if you like traditional period details like molding and exposed brick/wood work - this isn't for you.
How do auctions work? Typically the owners select a few or sometimes all residences to be auctioned off. This doesn't mean however, that if a unit has an opening bid say of $150,000 it will necessarily be sold to the highest bidder at $250,000. The builders reserve the right to deny a sale in most cases. So what you need to know, as the buyer, is how many units will be sold absolute - that means, sold regardless of price.
In this instance, The Saffron, will sell 9 units absolute at their upcoming auction Sunday November 8th. That means that 9 buyers will name and pay their own price.
It is also a good idea to work with a real estate agent when buying in auction. Contrary to rumors, this will not hurt your buying price. Why do you want a real estate agent in these cases? A real estate agent knows the current market and can flat out tell you what the market value of a unit or units currently are. This will ensure you not overpaying. Auctions can sometimes deceive your perception by thinking that you're getting a great price, however bidding can sometimes move very quickly and price escalates.. if you have a realtor with you they can guide and say "hey, we're at $600 a sq foot, that's above market, let's wait for another unit."
Some things you'll need to know to attend and/or buy a unit being auctioned.
Terms: in every auction I've seen, a deposit is required the day of. Usually this is in the form of a certified check - which is like cash. The Saffron is requiring $10,000 hard cash for one of their one bedrooms, and $15,000 for one of their two bedrooms.
Closing: Sometimes you might have to adhere to their closing date requests. In this case, The Saffron is offering an incentive to close quickly - by November 23rd, 2009 (which would make you eligible for the 1st time buyer tax credit) to receive an additional 2% discount.
Mortgage: I haven't seen any auctions require you to use their preferred lender, however I have seen some big incentives for doing so, sometimes this can be a good route and work in your favor. Again, having a real estate agent help you through this can save you a lot of money.
Attorney Review: Still the same as with a normal sale, however with new construction it will most likely be a different, new construction contract in which case you'll want a good real estate attorney to review.
You can preview The Saffron at their open houses only. They are October 11,17,18,24,25 & 31. November 1 & 7th. The auction itself will be held at a different location and registration is required.
If you're interested I highly recommend using an agent. If not, it's a cool learning experience to attend one of these to see how they work..
I'll be attending if you're interested in coming along!!
See more of Sheldon Good's upcoming auctions at www.sheldongood.com
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