162 East 63rd Street, #TH (Modlin Group LLC); Sonja Morgan (Sonja Morgan Facebook: https://www.facebook.com/sonjatmorgan/ )
Starting May 15, 2024, fans of The Real Housewives of New York City will have the chance to bid on alumna Sonja Morgan’s iconic Upper East Side townhouse at 162 East 63rd Street when it comes up for auction. Ms. Morgan’s attempts to sell it were part of her story arc almost the entire time she was on the show, and the townhouse was practically another character. There is no minimum bid, but one expert says beginning bids could start at low as $1.75 million – a far cry from the $12 million it was initially listed for in 2008, and it has been on and off the market at various price points since then. Buyers have until May 29 to place their bids.
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“The auction process aligns with my goal to sell at market value in an efficient and timely manner” – Sonja Morgan
The move has some scratching their heads, as many auctioned properties are distressed ones that have gone into foreclosure; while Ms. Morgan’s townhouse is certainly due for upgrades, it is far from distressed and in a prime Upper East Side location. However, luxury properties like hers occasionally come up for auction. This article explores the pros and cons of buying this way.
Types of Property Auctions
Foreclosure Auctions
The vast majority of auctioned-off homes are auctioned off due to foreclosure. In many cases, these are also distressed properties. In New York City, details about upcoming property auctions can be on the NYC Department of Finance site.Government Surplus Auctions
Regional, state, and federal authorities occasionally also hold auctions to sell off surplus items. In most cases, auctioned items are limited to old office furniture. For example, NYC’s Citywide Administrative Services is currently auctioning off several old lamps, printers, and even a few boxes of lightbulbs. From time to time, however, homes also come up for auction. While auctioned-off homes are rare in New York City, vacant lots do occasionally get auctioned off by local authorities. At the state level, home auctions are somewhat more common. Visit the state's Surplus Real Estate Auctions site to learn about upcoming opportunities.Luxury Auctions
While rare, luxury homes are also auctioned off from time to time when a seller is eager to ensure a quick sale. Ms. Morgan’s is the most recent and famous example; and, earlier this year, a condo at The Plaza generated headlines when it started at $1 at auction. It did not stay there for long, though – the winning bid was $2.5 million. While owner Tim Smucker took a loss on it, he was ultimately pleased with the speed of the process.The Advantages of Buying an Auctioned Home
One key advantage to buying a home at auction is access to unique properties at a steal of a price. However, it is important to note that it may not stay that way for long. A case in point was a Tribeca loft that was sold in a flash auction in January 2024: It started at $3 million in a dramatic reduction from the last asking price. However, after multiple bids that drove the price up, NBA star Mikal Bridges won the auction and paid $5.995 million for it, a figure much closer to the original listing price of $6.495 million.
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The Dangers of Buying an Auctioned Property
There are many potential dangers associated with bidding on auctioned properties, especially if you don’t already have an extensive background in real estate.
Limited Access to View or Inspect the Property
In contrast to a traditional sale, you may not be able to walk through the property in advance, which can put you at risk as a buyer. Likewise, you may or may not be able to carry out an inspection before putting in a bid and closing on the property.Additional Research
When bidding on a property, the onus is on you and your legal representative to find out what is going on behind the scenes. As always, hire a title search company to find out if there are any liens on the property, including contractor liens. Also, be certain to determine if their property is still financed and whether a second mortgage has ever been taken out on the property.Higher Closing Cost
Since researching the property is bound to take more time, expect your attorney fees to be higher than average. You may also have to pay outstanding loans or taxes at closing. Finally, to protect yourself at closing, you will likely need to purchase title insurance during the Escrow or soon after to protect yourself if your initial title search failed to discover a lien against the property.Legal Complications
Just because a property is being auctioned off doesn't mean the former owner is on board. In rare cases, the former owner or a tenant may still be living in the home, which evidently creates complications fewer bidders are likely to welcome.Limited Financing Options
Depending on the property, finding a lender may be more difficult if you’re pursuing an auctioned property. This partly reflects the fact that these properties often come with unique risks and unknowns.Given the potential dangers of bidding on auctioned properties, one might wonder if it is ever a good idea. In fact, if you're interested in a property being auctioned off and you do your due diligence, bidding on an auctioned home can be a great way to purchase a unique or undervalued property. Still, as a rule of thumb, always go in with your eyes wide open since bidding on auctioned properties shares little in common with the typical home buying experience.
Listings up for auction in NYC
145 West 86th Street, #1C
$450,000
Broadway Corridor | Cooperative | 3 Bedrooms, 1.5 Baths
Marketed for sale by private auction
Bidding open now through May 23
145 West 86th Street, #1C (Compass)
15 East 70th Street, #1A
$600,000 (-72.7%)
Park/Fifth Ave. to 79th St. | Condominium | 2 Bedrooms, 2 Baths | 2,035 ft2
Auction bidding open; current high bid $600K
Bidding ends May 21
15 East 70th Street, #1A (Compass)
15 East 70th Street, #GALLERY
$2,500,000 (-61.5%)
Park/Fifth Ave. to 79th St. | Condominium | 3 Bedrooms, 1 Bath | 4,605 ft2
No reserve; starting bids expected between $1.75M - $3.25M
Bidding open May 1-15
15 East 70th Street, #GALLERY (Compass)
15 East 70th Street, #GALLERY1A
$3,250,000 (-61.8%)
Park/Fifth Ave. to 79th St. | Condominium | 3 Bedrooms, 3 Baths | 6,594 ft2
No reserve; starting bids expected between $2.25M - $4.25M
Bidding between May 8-12
15 East 70th Street, #GALLERY1A (Compass)
2099 Fifth Avenue, #TH
$4,490,000 (-.1%)
East Harlem | Townhouse | 6+ Bedrooms, 6+ Baths | 5,939 ft2
No reserve; starting bids expected between $1.125M - $2.125M
Bid May 23 - June 6
2099 Fifth Avenue, # (Christies International Real Estate Group LLC)
162 East 63rd Street, #TH
$7,500,000
Lenox Hill | Townhouse | 5 Bedrooms, 6+ Baths | 4,500 ft2
No reserve; starting bids expected between $1.75M - $3.75M
Bidding May 15-29
162 East 63rd Street, # (Modlin Group LLC)
101 Warren Street, #3210/3240
$15,000,000 (-16.4%)
Tribeca | Condominium | 6+ Bedrooms, 6+ Baths | 6,400 ft2
Price reflects the Reserve Price for the property
Bidding open now through June 4
101 Warren Street, #3210/3240 (Douglas Elliman Real Estate)
Would you like to tour any of these properties?
Just complete the info below.
Or call us at (212) 755-5544
Would you like to tour any of these properties?
Contributing Writer
Cait Etherington
Cait Etherington has over twenty years of experience working as a journalist and communications consultant. Her articles and reviews have been published in newspapers and magazines across the United States and internationally. An experienced financial writer, Cait is committed to exposing the human side of stories about contemporary business, banking and workplace relations. She also enjoys writing about trends, lifestyles and real estate in New York City where she lives with her family in a cozy apartment on the twentieth floor of a Manhattan high rise.
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