Investments

New Orleans planning huge public property auction

City seeks to revitalize blighted neighborhoods

The city of New Orleans is planning to auction of 3,000 tax-adjudicated properties in an effort to revitalize some of the city’s blighted neighborhoods.

According to a report in the New Orleans Times-Picayune, prospective buyers will be able to view the properties online beginning March 6 and may be able to claim a property for as little as $3,000.

From the Times-Picayune report:

Those interested in bidding will, in exchange for $650 in earnest money, be able initiate the pre-auction process, a 90-day due-diligence period during which the city will attempt to locate the property owners and give them one last chance to make good on their tax bills.

After that period, bidding for the properties will begin.

According to a separate Times-Picayune report, there is no minimum bid for the properties, but the closing costs on most properties are expected by around $3,000.

But in nearly all cases, the properties in this auction aren’t actually houses, they are vacant plots of land.

From the second Times-Picayune report:

Any property can become tax adjudicated, but properties whose taxes go unsold at a tax sale are usually abandoned and are more frequent in low-income areas of the city. About 90 percent of the properties in the auction are vacant land, according to the city.

All back taxes and liens associated with the property will be wiped clean with the purchase, according to the city.

If a bidder does secure of these properties by winning an auction bid, the bidder is free to do what he or she wishes with the property, as if it was purchased through a traditional transaction, but there is a caveat.

Again, from the Times-Picayune:

If you win the auction, the property is yours to do with it what you wish, just as if you bought the property through a traditional transaction. You will, however, be responsible for maintaining it and paying the taxes. Blight and weed fines can stack up quickly. A month's worth of fines often total about $30,000 and remain attached to the property as a lien until you pay them off.

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