Property worth €15m goes at auction

HOW low can it go?

The results of the first major fire-sale of repossessed properties would provide solid proof of the total collapse of the Irish property market, according to the worst fears and predictions of some industry experts.

However, the verdict may still be out on whether house prices have reached rock bottom after almost €15m worth of property was sold during sometimes frenzied bidding at the auction in Dublin’s Shelbourne Hotel yesterday.

Scenes outside the building on St Stephen’s Green were in many ways reminiscent of the heady days of the Celtic Tiger economy when investors strove to outbid each other.

More than 30 minutes before the official start of the auction at midday, crowds had thronged the vast ballroom of the venue, once a favourite watering hole of property developers and leading estate agents.

With reserve prices for some properties pitched at less than the cost of a family car and a third of lots with reserves in five-figure sums, it was no surprise that over 1,000 people queued up to attend the auction.

Security men faced a torrid time in trying to restrict numbers as potential buyers waved cheque books and photo ID in the air to prove their bona fides to gain admission.

Many – including one successful bidder on an apartment in Portlaoise – were forced to watch the auction from outside on the street, while others moved a short distance down the road to Doheny & Nesbitt’s pub where proceedings were relayed by a video-link.

While many in attendance could easily be pinpointed as rival estate agents and the merely curious, there were also a sufficient number of genuine bidders looking for a new home.

According to the organisers, over 70,000 unique visitors accessed their website in the weeks before the auction, with investors from as far away as Israel and Hong Kong expressing an interest in some of the lots.

Auctioneer Gary Murphy warned potential bidders at the outset that it was presumed they had inspected the relevant properties and had arranged solicitors, surveyors and finance to be in place. “If you are not 100% happy, if you have any doubts and can’t get a satisfactory answer, please don’t bid,” he advised.

He said that once his gavel fell, the successful bidder entered a legally biding contract.

The auction was suspended for a brief period shortly after 1pm after gardaí warned overcrowding on the street outside was posing a safety risk.

After five hours, all but five of the 84 properties had been sold for a combined total of €14,465,500.

Prices ranged from €30,000 for a three-bedroom semi in Mullingar, Co Westmeath to €560,000 for a mixed use block of residential and commercial units in Wexford town.

It is estimated that the properties which fell under the hammer exceeded their reserve price by 22% on average, although 11 lots were still sold despite failing to meet their reserve.

Concluding the auction, Mr Murphy observed: “I think we might be back.”