Idaho will auction off three new undeveloped cabin sites on Priest Lake this year, partly to get a sense of the true bare-land values as the state moves toward divesting itself of the numerous state-owned lots there on which renters have built and owned cabins for years.
The state Land Board approved the auction plan this morning; the auction will take place in late August or early September. The three lots, all contiguous and lakefront, will be marketed nationwide.
“Although historically there have been 354 cottage sites associated with Priest Lake, an additional 17 have been platted and are unleased and undeveloped at this time,” Thomas Felter, the state Lands Department’s manager of commercial and residential real estate, told the board, which consists of the state’s top elected officials. “We believe a sale auction would help determine the market value for vacant and unimproved lots.”
The state had planned to allow some voluntary auctions of existing cabin sites this year where the lessees wanted to go that route – and perhaps bid against competitors to keep their cabin sites, or get paid for their improvements if a competitor won the bidding - but the need to reappraise all the existing sites has slowed that process down. Felter said none of the existing Priest Lake cabin sites will be ready for voluntary auctions before 2014.
He called the three adjacent lots a “unique opportunity,” saying they could be “auctioned in a number of configurations, either as a single or in groupings, to maximize return to the trust.” All three lots still would be limited to single-family residential development, with no more than one home per lot, and the appraised value would be the minimum bid.
Said Felter, “This will establish our bare-ground value. We feel like this will be a good indicator.”
However, Gov. Butch Otter noted that a buyer might be willing to pay more for a larger plot, perhaps setting a false mark for how much a single lot is truly worth. “I think there’ll still be serious questions if somebody comes in to buy another lot in the future,” he said after the meeting. “I just wanted to send a little signal, that let’s be careful.”
Felter said the auction would include opportunities for buyers from elsewhere to participate by telephone or online.
“I think it’s good that they’re doing what they can to broaden the field of interest,” Otter said.
Proceeds from sales of state endowment lands go into the state’s permanent endowment fund; its earnings benefit public schools and other state institutions.