by Nanette Massey
October means it is time again for the City Of Buffalo’s annual in rem auction of properties in default of back taxes. On Thursday, August 30th, the Buffalo Information Sharing Collective held a free public information session at Burning Books on Connecticut Street to give individuals who wish to participate in this year’s auction important background information.
B.I.S.C. is a loosely formed group of people with individual expertise in a variety of fields such as credit and banking, real estate, building and remodeling, and just about any other topics Buffalonians might need help with. “We live in the age of the internet,” said the group’s point man Ahmad Nieves. “So much is coming over, we don’t know what’s real and what is not real and can be easily overwhelmed. To move forward as a society we need to share our resources, and one of those resources is information.” Ahmad owns six pieces of property that he has bought through the city’s auction in past years.
The first step is to go to BuffaloNY.gov/839/Inrem- 51-Foreclosure-Listings on your computer. This list is frequently updated as properties become available. Make your own list of several properties you might wish to target. Secondly, drive by and visit those parcels. Ahmad’s brother, Ayat Nieves of Red Door Real Estate WNY, said this is a crucial piece of homework not to be missed. Tread with caution though. Seemingly abandoned lots are still private property, and standard laws about trespassing still apply. Third, find out which tax district each of your targeted properties falls in. Tax districts 1 through 5 are auctioned on the first day (Friday 10/15), districts 6 through 10 on the second day (10/16), and 11 through 14 on the last (10/17)
Next, secure your monies for purchasing way ahead of time. On the day of the auction buyers are expected to put down a deposit of 20% or $500, whichever number is greater. The rest–plus an additional $325 filing fee–is due by mid-December. Failure to pay in full by that date puts the property back into the city’s pool, and the bidder forfeits their deposit.
Some Things To Keep In Mind Ahmad warned those who bid beyond what they are ready to put down immediately will be politely escorted away by uniformed officials and barred from returning to future auctions. It used to be a common practice that cagey agents would overbid on desirable properties knowing that when they failed to come up with the deposit during the break, the property would be made available again later that day at a steal once competing bidders had unwittingly left. A useful bit of information to keep in mind should you lose a property you had your heart set on to another bidder.
If you can spare the time, wait around a little in a last ditch effort to see if circumstances play out such that it becomes available again. It is important to understand that until the auctioneer opens her mouth to announce a particular lot, the current owner still has the right to clear the back debt or negotiate a new settlement with the city. Surprisingly, this actually does happen quite often. That’s one of the reasons you should have several properties in mind going in.
The availability list printed even that morning is not set in stone. If you are a party on the unpleasant end of this transaction, meaning yours is the property being sold, you have a horse in this race too. Every penny beyond your arrears to the city belongs in a check coming back to you.
Yes, you heard correctly. That can mean having your debt wiped out, and a few dollars to make a new start. Many people are unaware of this, and that surplus money languishes in the N.Y. State pot of unclaimed funds. Contact the WNY Law Center to find out how to turn this windfall into real money for you. The bidding starts at $500 for vacant lots, $1,000 for lots with homes.
It used to be the case that one could easily expect to walk away with a sweetheart deal, but not anymore. Word of Buffalo as a city on the “come-up” has spread and out of town, even foreign, investors come to these auctions with deep pockets ready to lay cash on the barrelhead. Reports from last year’s event said many potential individual homesteaders left outbid and scratching their heads. Ahmad put forth that even buying just a vacant lot is a smart investment at this time “because it’s better in your hands than in some developer’s.”
The popularity of urban farming can make that lot an income generator sooner than you think. Local supermarkets such as Lexington Co-op, and especially juice bars like Ashker’s on Elmwood, are very progressive about cooperating with and purchasing from local independent produce growers on a regular basis. Crops like kale, swiss chard and other greens are in high demand.
Burning Books’ facility was standing-room-only for this evening’s presentation. Store owners Leslie Pickering and his wife Theresa bought this location at auction themselves in 2008 for a modest price. The savings on the property “has been a vital element of our business model,” said Leslie. “Because we got it at such a reasonable price, it has enabled us to make space for more arts and cultural events,” instead of only sponsoring those immediately contributing to a pending mortgage payment.
You are now ready to show up armed with facts (and cash) on the weekend of October 15th, 16th, and 17th at downtown’s Buffalo Niagara Convention Center, 153 Franklin Street, at 9am. Parking is always a challenge in this part of town so be sure to time yourself accordingly and bring lots of quarters.
Check the B.I.S.C. Facebook page for future info sessions, also in the Somali and Spanish languages, preceding October 15th.