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Auburn business breakfast speakers offer good, bad and hopeful messages

By: Gus Thomson, Journal Staff Writer
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Bracing messages of real-estate reality and entrepreneurial hope challenged Auburn’s business and community leaders Friday to tackle the recession with renewed perception and confidence. Michael Lyon, president of Lyon Real Estate, provided a healthy dose of reality to a morning Power Breakfast gathering titled “Not Business As Usual” organized by the city of Auburn and Auburn Chamber of Commerce. Using statistics from real-estate sales in March as well as recent forecasts on the estimated number of foreclosures yet to come, Lyon gave Auburn residents some grim numbers. For sellers of properties that are not bank-owned in Auburn the average asking price in March was $620,000, while the selling price was $354,000. That compares with January 2008, when the average asking price was $654,000 and the selling price for properties not owned by banks was $512,000. Lyon, head of a regional real estate empire that includes 18 offices and 900 realtors employed, said the competition for homeowners is coming from banks and other creditors that have houses for sale and are willing to unload them for significant discounts. Bank-owned property average asking prices in Auburn dropped from $485,000 in January 2008 to $301,000 last month, he said. The actual average selling price for bank-owned properties decreased marginally from $244,000 to $242,000. “The trend is ‘small and nice,’” Lyon said. Lyon said more bank-owned properties are due to come on the market as foreclosures continue to dig deeper into the stock of homes with variable-rate and interest-rate-only mortgages. “They’re just starting to hit,” Lyon said. “There is more coming and they should continue through 2012.” Lyon warned that the city of Auburn needs to be prepared for continuing decreases in revenue as assessed property values drop. But he did offer a ray of hope for Auburn. “The quality of life in Auburn will continue to attract people and any economic troubles will be smaller and shorter than in the valley,” Lyon said. Other Power Breakfast speakers were: Titan Gilroy, owner of a North Auburn machining company that has diversified by leasing space next door to open Titan’s Dungeon, a 15,000 square-foot workout facility. Gilroy advised the 150 people attending the event to set goals and be able to find a way to work around roadblocks. On a larger scale, Gilroy also remains upbeat. “As soon as people start relaxing and see the world is not over, and start spending money, everything’s going to be fine,” Gilroy said. “When the economy comes back you’re not going to have problems.” Gary Moffat, whose Old Town wine shop, bar and restaurant Carpe Vino has made shifts in its offerings in recent months to reflect new economic trends. Moffat said that his family business has “seized the opportunity” by adjusting its food menu from fine dining to “small plates” costing around $10, even going so far as jettisoning its use of tablecloths. A second decision was to refocus the establishment on wine sales. That proved fortuitous because local vineyards are maturing and wineries have learned to make great, prize-winning wines over the past decade, he said. Marketing also plays a role, including continuing to connect through its database with Carpe Vino’s best customers, Moffat said. The Journal’s Gus Thomson can be reached at gust@goldcountrymedia.com