“We have a real vested interest in fighting foreclosure, preventing the effects of blight and avoiding the effects of real estate speculation not just in Detroit but throughout the entire region and the state.” Andy Meisner on Detroit Today.
Yesterday on Detroit Today with Stephen Henderson, the conversation turned to the massive amount of land in Detroit owned by a handful of speculators betting on the future value of property in the city. That land often falls to blight because of a lack of incentive to invest in upkeep. But there are also issues with property taxes and how county revenues are affected by the blighted properties.
Oakland County Treasurer Andy Meisner tells Stephen Henderson that when auctioning off foreclosures, in addition to having a public-private partnership with area realtors to try to get families to buy the properties, ”I do our auction in person versus on the internet…that also gives us the opportunity to more thoroughly vet prospective purchasers to check and see if they are operating through an LLC.”
Meisner explains his vetting process further, “If we are working with somebody on a tax foreclosed property that we are re-purposing, we always will do that with a development agreement where we hold a developer’s feet to the fire, you can’t just sit on this property, you can’t speculate. Within six months we want to see those environmental [fixes] initiated, we want to see plans submitted within the first year. We want to see shovels in the ground within this time-frame, and if you don’t do it the property comes back to the county treasurer, and that provides some needed accountability.”
He also mentioned a study by MIT professor Parag Pathak, called Forced Sales and House Prices. The study found that when a home is foreclosed the value goes down on average 27%. That is in comparison to housing values dropping 5-7% due to death and 3% from bankruptcy.
“What this study suggests is that the average decrease for a home within 250 feet is at least 1%. In Oakland County that added up to $14 billion in taxable value and took us from the fourth wealthiest county in the country to the top twentieth,” says Meisner.
Click on the audio link above to hear the entire conversation.