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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsStop paying your property taxes if you are in Detroit
Detroit squatters can keep homes
Occupants of thousands of Motor City homes that didn't sell at a tax auction can purchase their abodes for $500. That includes squatters, renters and owners who didn't pay taxes.
By Karen Datko 22 hours ago
Unlike the man who claimed a pricey Dallas home for $16, squatters in Detroit houses that failed to sell at a tax auction may be able to keep their new digs -- for a mere 500 bucks.
The Detroit News reports:
In a stark sign that paying property taxes is optional for some in Detroit, Wayne County Treasury officials decided last week its workers will go door-to-door to some of the 6,500 city properties unsold at last fall's tax auctions and offer to make a deal with whoever is living inside. That could include renters, squatters or the owners who defaulted on their taxes.
If taxes had been paid on the 1,500 or so occupied units last year, that would have added $17.6 million more to Detroit's shrinking coffers, the News estimates.
The fact that some people will be able to keep their homes for $500 after not paying taxes for three years -- or just by virtue of squatting there -- hasn't gone over well with other taxpaying residents of Motor City.
Said one reader of MLive in Detroit: "Why am I paying ever-increasing taxes on a property worth less than half of what I paid for it if paying these taxes is optional?" Post continues below.
http://money.msn.com/taxes/article.aspx?post=a70b1623-a7f2-4262-81b9-ff8ad138040e#scptid
Why wouldn't the city just repossess the properties and sell them to payoff the overdue taxes?
TheWraith
(24,331 posts)That's hardly a guarantee anywhere these days, particularly if a property isn't in the best condition or the best location. As noted in the article, they're talking about properties which didn't sell at the tax auctions, implying that they couldn't sell these for what they wanted to.
Snake Alchemist
(3,318 posts)For them. And what about the guy next door that's paying a few grand in taxes? Can he now appeal that amount down to 500$? I have my doubts.
Motown_Johnny
(22,308 posts)but I think the limit is a 20% reduction per year
My brother , who also lives in Detroit, is in the process now.
Snake Alchemist
(3,318 posts)Rock solid appeal at 500$.
TheWraith
(24,331 posts)Suppose that in three or four months, they could find someone willing to pay $5,000. But over the course of that 3-4 months, they have the problems associated with those properties being either vacant or illegally inhabited. Vacant houses in the city are magnets for prostitution rings, drug deals, etcetera, requiring extra police attention that Detroit already can't afford. There's also the need to have additional bookkeepers tracking these properties, possible maintenance issues, people to solicit buyers, arrange auctions, all of which is being weighed against the extra $4,500 that that property would bring in a few months.
Add to that the immediate benefits of having a property legally inhabited; not only is it better protected against crime, but it improves property values in the neighborhood, increases the odds of the home being properly maintained, and greater chances of the home becoming again a productive part of the community.
In many cases, both for tax auctions and bank foreclosures, it's considered a better deal to sell these properties for a fraction of what they're actually worth rather than hold on to them hoping that you'll get a better value for them.
Snake Alchemist
(3,318 posts)And now you've given the house to people who you know can't pay taxes so the city better be content with getting 500$ per year.
Zalatix
(8,994 posts)DCKit
(18,541 posts)Snake Alchemist
(3,318 posts)Try half our even a third.
TheWraith
(24,331 posts)Tax auctions rarely sell at the full amount.
Snake Alchemist
(3,318 posts)And they're a lot higher than 500$.
MrCoffee
(24,159 posts)Snake Alchemist
(3,318 posts)Appeals.
drm604
(16,230 posts)They're acting as if they can stop paying and then just buy their house back for $500 after the city seizes it. That assumes that the city won't be able to sell it at a tax auction. That's a dangerous assumption.
Snake Alchemist
(3,318 posts)Seems like they have a rock solid appeal.
drm604
(16,230 posts)why would they settle an appeal for $500?
Snake Alchemist
(3,318 posts)Just paid 500$ in taxes for the year then it is a rock solid appeal.
KamaAina
(78,249 posts)What would happen if a progressive group were to start cruising these tax auctions and amass a decent-sized portfolio, perhaps focusing on one or a few neighborhoods?
izquierdista
(11,689 posts)I say we keep holding out until the wingnuts completely capitulate -- agree for the government to be the owner/landlord of last resort and to allocate housing 'to each according to his need'.
ProgressiveProfessor
(22,144 posts)The primary source of income is property taxes. Without adequate amounts it self destructs, not unlike Detroit is doing.
izquierdista
(11,689 posts)"From each according to his ability" -- That's where you can get adequate amounts of income.
Snake Alchemist
(3,318 posts)Amount. Maybe try for half? Even a third.
MrCoffee
(24,159 posts)Go to Detroit, ten square blocks of real estate, and establish a self-sufficient farm-type thing.
I would die of cholera within the first year, though...almost exactly like Oregon Trail!
KamaAina
(78,249 posts)with urban farming as one component (there's already quite a bit of that going on in the D). Possibly power generation as well, because their utility DTE is nearly as evil as our PG&E (cutting people off in the dead of winter, etc.)
AngryAmish
(25,704 posts)amandabeech
(9,893 posts)Article discussed someone who bought Detroit property, and planted it to oak. The plan was to let the oak grow for 20 years, and then harvest it. This plan supposedly is not farming.
MrCoffee
(24,159 posts)Now I'll never get to live in Detroit!!!
amandabeech
(9,893 posts)There is actually some remodeling done in areas close to the downtown--yes, there is one and GM is located there.
Folks either can't afford the Gross Pointes or don't want a hellish commute from the other burbs.
izquierdista
(11,689 posts)When there is demand, you can charge "what the market will bear"; when there is no demand (because of no JOBS!), then you can charge "hey, how much change you got in your pocket?"
Freddie Stubbs
(29,853 posts)Romulox
(25,960 posts)Your wit is why you are so popular, around here.
YellowRubberDuckie
(19,736 posts)Just so you know, if you buy out that lien, you now have a superior stake in that house above the mortgage company unless they buy you out. Loopholes are fun.
Response to Snake Alchemist (Original post)
jeff47 This message was self-deleted by its author.
Earth_First
(14,910 posts)Start buying up homes and giving them to those in need.