Online-only county tax sale draws more bids, results in more buys

Shelby County’s first online-only property tax sale was a success, county Trustee David Lenoir said, reeling in more bidders than previous tax sales with a higher percentage of properties going to buyers.

The sale ran Jan. 19-21 with 438 properties listed; 81 of them, or 18.5 percent, sold. That compares to previous sales where about 10 percent of properties sold, Lenoir said.

Unsold properties are purchased by the county and go into the Land Bank.

The number of bidders more than doubled, from 30 or 40 to about 100, Lenoir said. All but 18 of the 81 properties were purchased by investors within Shelby County.

The sales generated $1.2 million, with $630,000 going to cover unpaid county and city taxes and $580,000 in excess proceeds, which go to the prior owner or lien holder.

The county conducted two informational events before the sale, which helped generate interest, said Brian Danos, chief operating officer with CivicSource, the online sale vendor.

“We had gotten the word out very well and that’s why everybody understood what the online process was,” Danos said.

The county had several computer stations set up at the Vasco A. Smith Jr. Administration Building Downtown, but only about three or four people a day used them, Danos said. Most people bid from remote locations.

The sale officially ended at 8 p.m. Thursday, but sales continued as long as new bids were made every five minutes.

“It finally closed at 10:16 that night,” Danos said. “It was going back and forth that long. That’s the best part of the online sale, you can participate from home and it ensures that nobody is prevented from putting in their highest bid.”

Lenoir anticipates a few tweaks for the next tax sale in April, possibly staggering the bid process so that bidding doesn’t begin and end for all properties at the same time.

“Now that we’ve got one under our belt, what did we learn and how can we improve the process,” Lenoir said.

 

VIA http://www.commercialappeal.com/news/government/county/online-only-county-tax-sale-draws-more-bids-results-in-more-buys-2a40679a-55f7-18a5-e053-0100007f814-366625661.html

Shelby County Tax Property Sale Features Two Firsts

MEMPHIS, Tenn.-The Daily News- When the Shelby County Trustee’s office puts a set of tax delinquent properties up for auction Jan. 19-21, it will be a first in several ways.

The auction will be the first such sale in Tennessee online and it will be the first tax sale with shorter redemption periods for some of the property, depending on how far behind the original owner is on their property taxes.

Shelby County Trustee David Lenoir, who oversees the quarterly tax sales, came to recognize the point at which those buying property at the auctions realized their winning bid would have to wait a year on the original owner.

“He or she could come back at any point in that one year and redeem the property,” Lenoir explained. “I could see the body language of the attendees just slump over. ‘I’ve basically got some dead money for a year because I’m in limbo.’”

Lenoir talked about the coming auction Thursday, Jan. 7, at a Real Estate Roadshow at the Memphis Botanic Gardens cosponsored by Chandler Reports, the real estate information company that is a division of The Daily News Publishing Co.

The event, which was a preview of the auction and an opportunity for questions and feedback from potential bidders, drew more than 300 people.

The new redemption period is based on how many years in back taxes the original property owner owes.

If it is eight years or more, the redemption period is 90 days; it’s 180 days if they are 5-7 years behind; and the one-year redemption period still applies on property behind in taxes by less than five years.

For property that is determined to be “vacant and abandoned,” the redemption period is 30 days.

But Lenoir cautioned that local government leaders haven’t yet worked out who would do the inspections to make that determination.

Tennessee Gov. Bill Haslam signed the new redemption period into law this past summer.

The online auction is over three days and is being run by CivicSource.com, an online auction company based in New Orleans that was chosen through a county government request for proposal.

Through its web site, registered bidders can see the property on a map including vacant lots that are often listed without a house number.

They can bid remotely through CivicSource. The Trustee’s office also will have computer terminals available at the Vasco Smith County Administration Building.

Brian Danos, CivicSource COO, explained that buyers cannot have delinquent taxes, cannot be county government employees and must have a bank account.

The online site includes a “proxy bid” feature that allows a bidder to set a maximum amount they are willing to pay and the software will continue to go one-dollar higher than a current high bid until it hits the limit.

That allows online bidders to set the feature for several properties at once. They see rival bids but not the identity of the bidders.

All of the auction sales also come with a “sliding close” feature. A last bid, even if it is at the very end of the auction, must stand unanswered online for five minutes to be final.

If a bid is made within five minutes of 8 p.m. on Jan. 21, the closing time on the last day of the auction sale, bidding is automatically extended five minutes for any further bids.

If there is another bid in that five minutes, bidding is again extended.

“Sometimes this means things go on for a long time,” Danos said.

Lenoir was asked about out-of-town investors and landlords buying up large numbers of the tax properties and letting them deteriorate, adding to an already stubborn blight problem in Shelby County.

Lenoir said there are “good and bad” landlords and buyers who are local as well as out-of-town.

“When large hedge funds come in and buy big lots of properties long-term that could potentially be a problem because they are not necessarily buying it from a community development standpoint,” he said. “They are buying it from an investment standpoint.”

But Lenoir said he doesn’t think more hoops for buyers to jump through is necessarily an effective solution.

“I’m willing to listen to any practical, well thought-out solution for addressing the problem,” he said. “If someone wants to circumvent the system and put their property in a local buyer’s name just to solve that problem and then sell it 60 days later to an out-of-towner, you’re not going to police that.”

-The Daily News

Memphis, TN

Shelby County Launches First Online Delinquent Tax Sale Auction in Tennessee

MEMPHIS, Tenn. (Jan. 11, 2016) –Shelby County Government will hold the State of Tennessee’s first ever internet-based real estate tax certificate auction at www.CivicSource.com, beginning Tuesday, January 19th at 8:00 a.m. CST through Thursday, January 21st at 8:00 p.m. CST, subject to a sliding close. By hosting the sale online, bidders who would not normally be able to attend the auction in person are still able to participate.

Over 500 residential, commercial and vacant properties in Shelby County will be included in the January auction on CivicSource.com.

“The County is pleased to introduce this innovation by offering the tax sale in an online format,” said Shelby County Trustee David Lenoir. “Having the auction online opens up the market and can allow increased revenue to Shelby County.”

The tax sale allows investors to purchase the tax title to a property, which grants possession and ownership of the property following the expiration of the redemption period. In order to redeem their property, delinquent owners must are statutorily required to pay investors interest. Current interest is 12% per annum, which will begin to accrue on the date the purchaser pays the purchase price to the clerk and continuing until a motion to redeem is filed. The redemptive period for each property varies based on the number of years of delinquency, viewable on each property’s detail page at CivicSource.com .

The opening bid for a property includes delinquent city and county taxes, accrued interest and penalty charges, court costs, attorney fees, as well as service and title costs. The sale is open to the general public. Free registration and a list of available properties are available now at www.CivicSource.com.

“CivicSource allows citizens to actively better their community by helping to collect delinquent tax debt and offers Shelby County an opportunity to expand revenue potential,” said CivicSource CEO Bryan Barrios. “Participants are able to bid and monitor the auction remotely – offering convenience and efficacy through a sophisticated, yet user-friendly system.”

Additional questions regarding the process can be directed to the Shelby County Trustee, at (901) 432-4829, or the Chancery Court Clerk & Master’s office at (901) 222-3900.

Interested parties can sign up for the tax sale at http://www.civicsource.com. Register now for a free account and familiarize yourself with several investor friendly features such as custom watch-lists, sliding close and proxy biding.

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About CivicSource:

CivicSource is the leading auctioneer of tax-distressed real estate. From tax sales to adjudication auctions, CivicSource digitizes due process compliance to ensure legally valid sales. Founded in 2008, New Orleans based CivicSource has been recognized by Inc. Magazine’s 500|5000 as one of “America’s Fastest Growing Companies” and has been recognized as the one of the “Best Places to Work” in New Orleans for the past five years. For more information, visit: CivicSource.com.