City foreclosure auction opens slowly
Properties for sale hit record number
Buffalo's largest foreclosure auction in its history got off to a sluggish start Monday, with with nearly 85 percent of the properties failing to attract opening bids.
But city officials quickly pointed out that most properties on the block on the opening day of the three-day event had been offered unsuccessfully in past years.
They predicted activity would pick up today and Wednesday when the auction continues in the Buffalo Niagara Convention Center.
Nearly 700 bidders participated in Monday's auction, but only 237 of about 1,420 properties offered attracted the minimum opening bids.
As of Monday, about 3,400 properties remained up for sale. The number declined slightly each hour as people who owe back taxes and fees scrambled to pay their debts.
"We can remove properties from the [auction] list right up until two minutes before the sale," said Martin F. Kennedy, the city's commissioner of assessment and taxation.
He encouraged people to visit the tax office in Room 121 of City Hall to pay their delinquent bills.
Some bidders Monday were looking for investment properties. They included Clint Holcomb, who acknowledged that investors must plan beyond the initial purchase price.
"People need to make sure they not only have money to buy the place, but also to make repairs," he said. "There's a reason a property is only selling for $4,000 or $5,000."
City Judge Henry J. Nowak, who presides over Housing Court, urged bidders to become familiar with the process and any properties they hope to buy. Many properties on the list have pending housing code violations that will have to be resolved after sales are finalized.
"The people who have the most trouble are people that come in with unreasonable expectations — those who think they can buy a beautiful property for next to nothing that needs no work," Nowak said.
But he also noted that the number of auctioned-off properties that later become problems in Housing Court seems to have declined.
Some give partial credit to a task force that has been targeting "flippers," who buy cheap properties, then quickly sell them without making improvements. Kathleen A. Lynch, coordinator of the Mayor's Anti-Flipping Task Force, noted that buyers must sign anti-flipping affidavits promising not to sell the parcels for more than 120 percent of the auction price for at least six months.
"Please understand that the city will monitor and will enforce that provision," Lynch told participants.
She later told a reporter that housing advocates who are monitoring the auction have not seen any obvious signs of potential flipping activities.
Many first-day bidders bought vacant lots. Diane Picard, executive director of the Massachusetts Avenue Project, successfully bid on a West Side parcel that her not-for-profit group has been using as part of an urban farm.
While this is the largest auction in city history, Kennedy noted that unlike last year, the list included properties that are delinquent in paying water bills. If the city hadn't imposed a one-year moratorium last year on foreclosures for newly delinquent water bills, Kennedy said, last year's auction would have been larger.
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