Foreclosure Home Auctions in Buffalo Bar Flippers

City officials conducting foreclosure home auctions in Buffalo, New York have been prohibiting flippers from participating in the bidding, according to Kathleen Lynch, head of the Buffalo Anti-Flipping Task Force.

Lynch explained that the city is trying to avoid further problems related to vacant foreclosures that result from flipping. She said that in the past, flippers were snapping up cheap foreclosed properties at auctions and then reselling them quickly without making repairs and improvements.

Each prospective auction participant is required to sign an anti-flipping affidavit, promising not to resell any property bought at the auction for over 120 percent of the final sales price within six months from the auction date. She said that the city of Buffalo will monitor all properties after the auction.

In the most recent Buffalo tax foreclosure auction held in October at the Buffalo Niagara Convention Center, nearly 3,500 properties were offered for sale at the auction. But before the bidding started, the properties dropped in number as owners rushed to pay back taxes and penalties to take out their properties from the list.

According to Buffalo Taxation Commissioner Martin Kennedy, tax officials can remove listed properties from foreclosure home auctions up until a few minutes before the auctions.

At the October auction, it was Buffalo Judge Henry Nowak who presided and opened the auction. He told auction participants that they need to be familiar with the properties they are planning to purchase because a lot of the properties have pending building code violations that they need to resolve after sales contracts are signed.

He explained that in the past, many buyers thought that they can buy the best properties at the lowest prices. He told his audience that they need to be realistic because most of the properties being auctioned need repairs. If not, the properties would have not been offered at cheap prices as low as $4,000, he added.

Among the prospective buyers was Diane Picard, head of the Massachusetts Avenue Project, a nonprofit that plans to buy a vacant lot where they have been growing plants. Before the foreclosure, the owner has been allowing them to create urban gardens on the land.

According to Commissioner Kennedy, the October 2009 auction has been the biggest compared to all city-administered foreclosure home auctions in the past, but he added that unlike in the past, properties of owners delinquent in paying water bills this year were included.

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