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At least 32,000 Wayne County properties likely headed to auction in the fall

Jun 23, 2015

Credit Charles & Adrienne Esseltine / Flickr

After months of outreach and efforts to avoid a massive foreclosure crisis, more than 32,000 Wayne County properties are still on track for the county’s annual property tax auction in the fall.

That’s 32,629 properties county-wide, according to the latest numbers from the Wayne County Treasurer’s office. 28,545 of those distressed properties are in Detroit, the heart of the delinquent property tax issues.

Just over 4,000 of the Detroit properties are owner-occupied homes, while another 6,300 or so are rental properties.

There is some good news and some bad news in these numbers.

The good news is that the number of properties still in foreclosure is considerably less than the almost 75,000 tax-delinquent properties the county sent foreclosure notices to last fall.

That’s in large part because the county has been aggressive about reaching out to delinquent homeowners, and getting them onto low-interest payment plans. In fact, the state legislature temporarily changed state law so more homeowners could get help.

According to the county treasurer’s office, around 20,000 people are currently on those payment plans.

But now the bad news: even more people had signed onto those plans, but an unspecified but significant “number of people … are already non-compliant with the agreements,” Deputy Treasurer David Szymanski said in an email.

Those numbers could change before the fall auction. By law, the county is required to offer those properties to the state and then local governments before proceeding to auction.

Before that happens, the county will once again offer some owner-occupants a last-ditch chance to get on payment plans in August through a process called reclamation, Szymanski says. The county had already extended the period for the initial period of “redemption” to avoid foreclosure from March to June.

But then there’s the matter of the so-called “reverters” — properties that have already been through the tax foreclosure auction once, but reverted back to county ownership once again for failure to pay property taxes.

According to data from the property data-tracking site Loveland, there are 20,773 reverters in the system right now. However, Szymanski says the county will likely only foreclose on a fraction of those to avoid being completely overwhelmed.

However many properties end up on the auction block in the fall, it’s virtually certain to be a record number. Last year, just about 24,000 properties went to auction.

Many Detroiters and housing advocates say the city and county need to do much more to help people stay out of foreclosure, or risk an unprecedented crisis that will further devastate neighborhoods, and jeopardize Detroit’s fragile recovery.