Building Detroit, a website designed to auction off city-owned houses
, has launched. It features a number of safeguards that are designed to keep speculators from bidding on the properties. The idea is to ensure that houses go to people and companies who will fix, maintain, and populate the homes.
Houses will be available at a rate of one per day starting Monday, May 5. Bidding starts at 8 a.m. and runs through 5 p.m. There are currently 12 houses listed on the Building Detroit website. Bidding for the first house, 4184 Bishop, starts at $1,000. Registration has opened for potential bidders.
The city is employing what it calls a "rigorous process" to vet winning bidders. Winners must pay 10% of the price within 72 hours of winning the auction. If purchased for $20,000 or less, winners must make the full payment within 60 days of the auction. Winners have 90 days to make a full payment if a property is purchased for more than $20,000.
The Detroit Land Bank Authority requires winners to demonstrate executed construction contracts for home rehabs within 30 days of closing. If the winner is rehabbing the home themselves, they are required to provide corresponding receipts.
Buyers have six months to be granted a certificate of occupancy and have the home occupied. Failure to meet all of these requirements results in losing both property and purchase price. Such rules should prevent speculators from buying properties only to sit on them, leaving them unoccupied and at-risk for scrapping and squatting, something for which the Wayne County Tax Auction has been criticized.
On April 27, the East English Village Association, heavily involved in the auction's first round, will be hosting open houses for the buildings available in its neighborhood.
Source: Building Detroit press release
Writer: MJ Galbraith
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