The effects of Hurricane Maria only exacerbated Puerto Rico’s already-weak economy. So to help accelerate recovery from the recent storm, Auction.com and other leaders from the mortgage and housing industries came together in San Juan, Puerto Rico, November 14 to 16, for the Five Star PR18 leadership summit. This industry think tank, of which Auction.com was a host sponsor, discussed solutions to help accelerate the recovery and revitalization of Puerto Rico.
In addition, right before PR18 started, Auction.com held a special online auction of Puerto Rico properties. Auction.com Cares, a program which helps communities thrive by supporting efforts that help stabilize neighborhoods, then gave $10,000 of the proceeds to Pitch In for Baseball. This organization helps children in Puerto Rico, as well in other places around the world, to escape the loss and sadness of disasters through baseball.
Auction.com’s Puerto Rico partnership
Before Hurricane Maria, during the crippling financial crisis that started in 2007, Auction.com began helping to revitalize Puerto Rico’s neighborhoods through the auction process.
Selling distressed properties quickly to investors and owner-occupants helps boost the local economy and protect communities from blight. New owners will typically rehab homes, infusing the local economy with capital for the labor and resources needed for improvements.
Since the crisis, Auction.com has held dozens of auctions for Puerto Rican property, as well as educational events. The result has been hundreds of Puerto Rican properties sold on the Auction.com platform, with many being rehabilitated using local resources and materials.
But after years of financial hardship, nothing could prepare Puerto Rico for Hurricanes Irma and then catastrophic Maria, leaving the island desperate for help.
Hurricane Maria’s sweep across Puerto Rico in the fall of 2017 was disastrous: Property damage affected more than 250,000 housing units — of which approximately 35,000 remain uninhabitable.
A little over a year later, recovery and rebuilding remain tedious.
Auction.com’s Puerto Rico Ambassador
Dave Lee, Auction.com’s Business Development and Sales Vice President, has been with the Auction.com family of companies since 2004. Lee grew up in Puerto Rico and has worked extensively on the island for Auction.com. He owns property on the island and plans to retire there. Like Auction.com, he has a vested interest in the island that goes beyond buying and selling property. He wants to see the people prosper and the island’s financial stature become healthy again.
“Where there are vacant homes, there are problems,” he said. “Auction.com is able to get people back into homes. Owner-occupants and investors from the island and the contiguous United States are stabilizing factors for Puerto Rico’s communities.”
Along with the benefits of rehabilitating properties, Auction.com’s marketing efforts help spread the word worldwide about Puerto Rico’s plight. Auction.com’s extensive buyer database allows heavy targeting in areas with high concentrations of Puerto Ricans, such as New York and Florida. And that interest in Puerto Rican assets culminated with an October online auction that resulted in 87% of assets having two or more bidders. By attracting more buyers to participate in the auctions, Auction.com helps speed the recovery.
Sellers also benefit by Auction.com’s commitment to the island. In the same October Puerto Rico real estate auction:
- 40% of assets were sold
- Winning assets sold on average at 114% of reserve
What’s more, after the hurricanes — during periods of chaos and confusion — sellers can find it difficult to place a value on island properties. But since Auction.com can bring distressed properties to market quickly and efficiently, the competition ensures that sellers are able to get a good read on what the market will bear and find the market rate for assets.
“It’s been a year since Hurricane Maria,” said Lee. “And although the island may have fallen out of the headlines, Auction.com is keeping laser-focused attention on Puerto Rico with the auctions we are holding.”
Helping to change lives
Lee recently met a local Puerto Rican woman during an on-island auction educational seminar. Coincidently, the woman’s name is Maria.
Maria still lived at home with her family and wanted to buy her own place. Her mother’s house was heavily damaged by the hurricane, and her family had been without power for about six months.
Maria and her mother were first-time auction participants who responded to local Auction.com advertising. She was interested in buying a home or condo in San Juan but didn’t think she could afford anything currently on the market. That’s what drove them to check out the auction.
Maria and her mother attended the auction educational seminar. They were nervous, but Lee helped build trust and confidence in the process.
Lee remembers getting a call after the auction. It was Maria letting him know that her dream of homeownership had come true: She had won her auction. Maria then thanked Lee for helping her understand the process and Auction.com for offering the opportunity.
Lee also connects with local investors who are using Auction.com as a conduit to build their business in Puerto Rico.
Whether owner-occupied or a fix and flip, a repaired Puerto Rico home that’s reintroduced into the neighborhood helps feed the local economy and lift the spirit of the community. Using the auction process alongside industry efforts such as PR18, we can put families back into homes and Puerto Rico back on the path to growth and success.