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Ineffective County Tax Auction Finally Makes Blight Bundle

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The Wayne County tax auction, which sells tax foreclosed properties in an online bidding process, has not been known to actually reduce blight or improve property tax collection in Detroit. The most obvious example of its failings is that 78% of the properties it has sold since 2011 were to owners that did not pay taxes on them. So at 22% success there has to be something better. Some say that is the Land Bank, the entity that auctions off two properties per day online via the Building Detroit page. Now the Wayne County tax auction has gone and invented something called a "blight bundle" which might put a lot more properties in the Land Bank's hands.

The reason the Land Bank auctions are considered more effective than the Wayne County auctions are that they come with a lot more rules and accountability. To buy from a "Building Detroit" auction a bidder has to be a Michigan resident, a non-Michigan resident who will live in the property after rehab, or a company/organization authorized to do business in Michigan. Which is to say speculators over seas can't bid on the properties just to hold on to them for a few years in an attempt to sell them for profit. Bidders can't have unpaid property taxes, or unresolved blight or code violations and can only purchase one property per month. Most importantly, bidders will be held accountable for renovations. The official rules are as follows:
• Within 30 days after closing, you must provide the Land Bank an executed copy of a contract to rehab the home. If you can demonstrate to the Land Bank you have the skills to rehab the house yourself, within 30 days after closing you must provide the Land Bank receipts showing you have purchased the materials necessary.
• Within 6 months after closing, you must provide the Land Bank with a Certificate of Occupancy for the house and demonstrate that the house has an occupant.
• If the property is in an historic district or has historic designation, you must provide the Land Bank with a Certificate of Occupancy within 9 months after closing.
• If you fail to meet these deadlines, you forfeit both your purchase price and the property and are forbidden to bid in all future auctions.

So this in year in the Wayne County auction they have created a package of 6,300 properties that have to be bought as a whole. This so-called blight bundle is on Wayne County page for open bids but it it does not sell (and it likely won't) those properties will be transferred to the Detroit Land Bank Authority (DLBA) so that they can sell them via their own process. The 6,300 properties are a mix of vacant land that comes with a pretty heft stipulation:
Purchaser must either demolish all properties in six months or present a development agreement acceptable to the Wayne County Treasurer's Office.
So if you're up for herculean tasks, we'd challenge you to even visit all 6,300 properties in the next six months, much less figure out what to do with them. Bidding in the tax auction will begin tomorrow.
· Wayne County Treasurer [Official]
· Tax Auction Kicks Off Again On Thursday With 18,201 Properties [Curbed Detroit]