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Posted on Wed, Sep 22, 2010 : 6:20 p.m.

No takers: Large development properties go unsold in Washtenaw County's online tax foreclosure auction

By Paula Gardner

Thousands of people viewed the online auctions for three Washtenaw County development parcels before bidding closed Wednesday afternoon on the tax foreclosure sales.

But in the end, no one bid on the chances to build new housing on the properties.

"At this point, they're not worth anything," said Saline-based builder and developer Jim Haeussler. "They're worth more as an open field."

Up for auction at were three properties that represent some of the largest tax foreclosure auctions ever in the county:

• Wellesley Gardens, where 33 acres in the second phase of the 427-home condo project were auction off for unpaid back taxes. The property in Pittsfield Township was available for a minimum bid of $1.2 million.

• Uptown Village in Milan, where 31.47 acres went unbuilt in the neo-traditional community developed by Delcor Homes. The minimum bid was $193,327.

• Liberty Square, where 63 townhouses in the condemned, 151-unit Ypsilanti Township complex were available for the minimum bid of $299,926.

The lack of bids appears to show just how much residential development has slowed.

Haeussler, president of Peters Building Co., said "there's not a market" at this point for development property in Washtenaw County.

Even if a buyer didn't have to finance the land, "no one will loan anyone money to finish (a project)," he said.

Liberty Square is a unique circumstance because the auction was for non-contiguous units, and the county is requiring a cash performance bond to ensure a buyer either demolishes or rehabs the units.

The other two parcels — once part of the county's fast-paced residential growth — show the limited market for land in outlying areas or condos, where many existing units are on the market, Haeussler said.

"Market-wise, they reached the saturation point with other (homes) available at a similar price," he said.

And due to other considerations like the secondary locations, "other products would sell first," Haeussler said.

That makes the next step for the county important as it seeks to recoup the back taxes, said Treasurer Catherine McClary.

The three parcels that didn't sell Wednesday will go back up for auction without minimum bids, she said. In total, the 22 parcels that did not sell in this month's multple online auctions - plus the three development properties - will be listed for starting bids of $350 on Oct. 26.

"We're going to have a chance to sell all of the ones we haven't sold at a sale where we will not try to recoup the taxes," she said. "We're just trying to ... recoup as much money as we can."

That amount, McClary said, will recover the costs of the auctions and fling the deeds after the sale.

"My hope is that when people start bidding... the property will get bid up to something that is closer to the value of what it should sell for," McClary said.

If they don't, it's possible all of the taxing entities that received advance tax payments from the county for the properties will face chargebacks from the treasurer.

That means municipalities and other beneficiaries from property taxes - like Washtenaw Community College and affected libraries - could be forced to issue refunds to the county from their already-strained general funds.

Paula Gardner is Business News Director of Contact her at 734-623-2586 or by email. Sign up for the weekly Business Review newsletter, distributed every Thursday, here.



Thu, Sep 23, 2010 : 3:59 a.m.

Joe Payer and Engineer are right: to charge so much when this part of the state is suffering through some outrageous job lack is insanity. Why would anybody buy a home here when there are no stable jobs? I've been checking a few of the major universities' job placement programs and the best jobs I've found is Walmart-styled retail positions. You cannot afford a home with that kind of employment, even if you were lucky to get that job and flourish in it. Prices have to come down and jobs have to come back. Until that happens, expect more of this. It's really a shame because the Milan development is looking incredibly ragged right now. Now it looks like it's going to return to what it was before: more featureless cornfield with US-23 cutting through it.


Wed, Sep 22, 2010 : 10:49 p.m.

Their minimum bids are crazy high. There is a reccesion folks. Make the min a couple hundred bucks and offer me tax incentives (ie no taxes) for years to come like you give your rich buddies and I will take one and begin to fix it up into some thing useful. Good way to clean up the blight!


Wed, Sep 22, 2010 : 10:30 p.m.

How does Washtenaw County expect anyone making ten bucks an hour to afford any property in this area and pay top dollar for property that will never return their investment? They should rename this area WashAway County cuz After Ford and Gm closed up so did everything else, oh and BTW U of M can't even resurrect this one from the grave. When a nurse once considered a good occupation can't even afford to buy a home here whats left for anyone else


Wed, Sep 22, 2010 : 8:46 p.m.

And BTW, B.O. said the recession was over in July of 2009. Yeah, right!

John Alan

Wed, Sep 22, 2010 : 7:51 p.m.

@ John Q I guess one way of looking at it is now that Washtenaw County owns these property, they should step up and pay these fair taxes!!! It is their property since they forclosed on it. It appears that some think that these assessments are fair and true so it is not a big deal for the new owner (the County) to step up and bite the bullet and pay what they expected other people pay in property taxes....


Wed, Sep 22, 2010 : 7:38 p.m.

@John Q It may be true for developments But when is the last time you bought a home? Do you have a clue how much of a jump the taxes take when the property is uncapped?

John Q

Wed, Sep 22, 2010 : 7:29 p.m.

Wrong. It's exactly what Mr. Haeussler stated. There's no market right now for development in those areas. It has nothing to do with the taxes that the cities and townships did or didn't raise.

John Alan

Wed, Sep 22, 2010 : 7:07 p.m.

This is the proof that the townships and cities kept raising taxes and now go figure..... No one is even willing to pay just the back taxes and take over the property for free.... Of course the county says the buyer must pay full 2010 taxes which is an arm and leg to begin with. On top of that, at the end of 2010, one got to go and fight to get the SEV lowered and get denied by the board and then go to Tax Tribunal and etc.....