Foreclosure Auction Draws Deal Seekers
Thousands Attend Massive Sell-Off

By Michael E. Ruane
Washington Post Staff Writer
Monday, March 10, 2008

Emmanuel Warren was with his wife and eight children seeking a home with lots more room.

Franco Abbruzzetti was looking for a house for his son.

Carlos Amaya and his pregnant wife, Shardonna, had their eye on a five-bedroom in Bowie, but they lost out to a higher bidder.

It was a multi-house auction yesterday at Walter E. Washington Convention Center, fueled by the skyrocketing numbers of local foreclosures, and it fulfilled some hopes and deferred others, as more than 200 homes went on the block.

While tuxedo-clad auctioneer Mark Buleziuk chattered rapid-fire prices and the public address system blared the '80s hit "Living in America," several thousand people bid on ramblers, townhouses, condominiums, bungalows and McMansions in the District, Maryland and Virginia.

All the homes had been foreclosed on and were owned by banks trying to recoup some of their losses, according to Real Estate Disposition of Irvine, Calif., which ran the auction.

"It's clear by what's out there in the media that there is a high rate of foreclosure," said Mary Clare Quella, vice president and associate general counsel for the auction firm. "Lenders do have large portfolios in foreclosed homes."

But the tragedy of foreclosure presented a chance for others, she said.

"These are members of the community who recognize that they have an opportunity to get a real value on a property, help determine what that selling price is, rather than the local broker, and hopefully have a good investment in their first-time home," Quella said.

The auction continues today at the Baltimore Convention Center and tomorrow at the Greater Richmond Convention Center.

The first house on the block yesterday was a renovated three-bedroom, two-bath brick rowhouse with a porch on Quincy Place NE in the District.

The house had been previously valued at $435,000, the auction catalog said. The starting bid was $139,000.

Buleziuk began like a track announcer calling a horse race. Bidding moved quickly to $300,000, then $310,000. "Who else came to buy?" he droned. In the crowd, Abbruzzetti raised his white bidder's card. "Three hundred and fifteen. Thank you, sir," Buleziuk called. He tried to push the price higher, but the house went to Abbruzzetti.

The 69-year-old chef and owner of Alexandria's Trattoria Da Franco restaurant later expressed irritation when he was told that his winning bid did not meet the bank's undisclosed reserve, or minimum price. The bank still has 15 days to decide whether to accept his bid. "It's ridiculous," he said. "It's a joke."

Investors Leon Segears and Joyce Palmer, who buy, rehab and sell homes for a living, had targeted five dwellings in the auction catalog but managed the winning bid on only one. The three-story rowhouse on Madison Street NW had been valued at $398,000. The starting bid was $149,000. The partners' winning bid was about $275,000.

The two said later that they had calculated how much each house would cost to renovate, how much they could later sell it for and how much they were prepared to spend. They said that despite the mortgage crisis, there was money to be made by the disciplined investor.

"We don't get emotional," Palmer said. "If the numbers work, we do it. If the numbers don't work, we don't do it."

Warren, a member of the U.S. Capitol Police, said he was simply looking for more bedrooms for his eight children. He and his wife, Corrie, who live in Triangle, had 12 homes on their list. As the auction went on, he kept an eye on the kids, who filled a row of seats in the cavernous hall, while his wife pored over the catalog.

Amaya, 35, a D.C. police officer from Landover, focused on an elegant brick home in Bowie with a two-car garage. He and his wife have one child, and with another on the way, they were looking for a bigger house in a spacious neighborhood.

The house was valued at $780,000, and the starting bid was $289,000. But others were interested, and the bidding rocketed to $450,000, $475,000, $500,000, then $530,000 -- well beyond the $470,000 Amaya was ready to pay.

"It went bad," he said after it was over. "But it's okay. . . . I'm not disappointed."

Meanwhile, the voice of the auctioneer thundered nonstop from the big black speakers scattered throughout the hall: "Whadayasay . . . five hundred thirty-five. . . . I'm-asking for five-thirty-five. . . . "

In the back of the room, John Magnacca and his neighbor, Vicki Lillicrapp, of Alexandria, were on their way out after coming to see how the auction worked.

"To me, it's depressing," said Magnacca, 56. "This is going on across the country. It's really sad."

Lillicrapp added: "This is actually people who are losing their homes.

"We were also saying how much worse it's going to get over the coming months," she said.