hipchickindc is a licensed real estate broker with extensive experience handling the sales of distressed properties. Her clients include reputable developers, architects, and homeowners prepared to finance and manage major renovations. The opinions expressed below are her own and do not necessarily reflect those of the company or professional associations that she is affiliated with.
Initially, I was pleased to see the bright yellow signs on several of the abandoned, neglected, yet architecturally and historically significant homes in my neighborhood. I’ve been interested in some of the properties for years. To me, they represent possibilities for change and revitalization.
I’m sure the DC Government feels the same way because in 2008, the Property Acquisition and Disposition Division was established. The tag line of their web page even says, “Revitalizing Communities One Home at a Time”.
The yellow signs announce in bold lettering that over thirty properties owned by DC Government will be auctioned off on the 30th of January 2009. Potential buyers are directed to the Alex Cooper Auctioneers website. I dutifully followed the crumbs and came upon the DC Gov Auction pages here: http://realestate.alexcooper.
In addition to the signs and the web page, listings of the properties have begun to appear in the local multiple listing system. The ones that I have seen indicate a list price of $20,000. The remarks clearly indicate that the price is subject to auction. You can see the listings here: http://matrix.mris.com/Matrix/
Buyers that are interested should attend the Buyer Seminar scheduled for the January 22nd, 2009. More information is available on the Alex Cooper link.
Here is some information you should be aware of before even bothering to attend the seminar: Continues after the jump.
- The properties are not available for inspection prior to the sale. I often tell my clients that the properties built 100 years ago are typically very solid, however, shells vary widely in terms of structural condition. If the interior has been subject to severe termite or water damage, there could be much more expensive costs than expected for restoration. You also never know what could convey with the property, such as, oh, I don’t know, human remains?: http://www.washingtonpost.com/
- There properties are being sold subject to covenants. It appears that DC Gov is selling these properties subject to time frames and guidelines related to renovation and possibly re-sale. Hopefully, these buyers will be able to get their permits from DC Gov sooner than my clients have been recently.
- Bring lots of cash. Owner occupants are able to finance renovations fairly smoothly through FHA(203)k products. Investor financing, however, is very, very challenging to come by. (I would bet that the majority of foreclosures in the downtown DC market were failed investor projects.) Because these properties are small and still require extensive work and high management, my guess is that buyers with cash or private equity financing will think twice unless they can buy numerous properties in bulk. At minimum, buyers will need $10,000. per property to bid. If a bid is accepted, the buyer must provide a 10% deposit (the $10k registration fee will be applied to the 10%).
If anyone is planning to attend the Buyer Seminar, I’d love to hear back about how it goes.