What did I just witness on DLBA Auction?

[Jesse Kassel]

Hello BP community, this is my first post. I'm just starting out still looking for my first project. 

Recently came across a Detroit land bank home that was in pretty good shape in a decent neighborhood, needed about 20-30k with ARV of ~115k. With bids starting at 1k I was very interested! Of course bidding quickly passed my 30k tap out point.

I wanted to see where this thing went so I watched the rest of the auction. With an hour left bids jumped from around 30k to 50 to 100 with a final bid of 200k.

I am totally confused and wondering if anyone here has any insight as to what happened? Was this some kind of strategy for bumping the previous bidder or just frustrated frenzy over what could have been a stellar deal? Would love to know if there's a part of this process I am missing should another chance like this come up again..

Thanks! 

[Travis Biziorek]

This is the one that was on Lafontaine, huh?

I was tweeting about it. And to be quite honest, I have no idea what happened there. The winning bidder "won" with a $200,000 final price. But it jumped from $100,000 before that and like $50,000 before that.

Honestly, I expected this house to go for $50,000 up to as much as perhaps $80,000. The $200k makes no sense and I highly doubt that buyer closes on it. 

I don't know what happens at that point. I believe the DLBA offers it to the next highest bidder.

One other potential scenario is the winning buyer was willing to pay ~$100,000 for this house AND they are a city employee or has a relative that is a city employee. That means they can get a 50% discount on the winning bid.

If that's the case, they a) knew they'd kill the competition by smashing it to $200,000 and b) know they weren't going to pay any more than $100,000 for the house. 

It's hard to say exactly what the outcomes but it was insane to see for sure!