published Monday, February 4th, 2013

On the block: Number of back-tax properties rising in Hamilton County

A lot on the 2000 block of McCallie Avenue awaits to be sold along with 191 other properties in Hamilton County that have lingered in tax delinquency for years.
A lot on the 2000 block of McCallie Avenue awaits to be sold along with 191 other properties in Hamilton County that have lingered in tax delinquency for years.
Photo by Connor Choate.
  • photo
    This property at 2014 Ivy St. is one of 191 properties being sold in Hamilton County's annual delinquent tax sale.
    Photo by Connor Choate.
    enlarge photo

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    This home on Wert Street is one of the 191 properties that is being sold in Hamilton County's annual delinquent property sale.
    Photo by Connor Choate.
    enlarge photo

IF YOU BID

The county encourages prospective buyers to visit and inspect properties before bidding. Properties are sold as-is.

For property lists, bidding forms and more instructions, visit www.hamiltontn.gov/realproperty or call 423-209-6444.

HOW IT WORKS

There are two phases of the county's annual property sale.

1. A round of sealed bids is due to the Real Property Office by Feb. 18. The bids will be opened publicly in the County Commission chamber Feb. 19. Bidders or their representatives must be at the opening, and must pay a 10 percent deposit on any property bid that day.

2. A 10-day waiting period follows, during which the high bids are advertised and others can send letters of intent to raise those bids by 10 percent. Properties with challenged bids will go to a "bid-off," or a public auction, which will be held in the commission chamber March 15. The highest bidder gets the property.

As Hamilton County officials tallied up the number of properties on its annual property sale this year, it was like watching the recession play out on a four-year delay.

It takes about four years of unpaid back taxes before Hamilton County seizes and sells properties. So most properties in this year's sale first went into delinquency in 2008 -- right as the economy began its nosedive.

The number of properties on the auction block this year is more than twice what it has been in recent years.

"It's definitely showing what started happening to the economy that year," said Dan Thornton, Chattanooga's director of general services. "I think over the next three years we will see a large number of parcels as that plays out."

The 191 properties in this year's sale -- vacant lots, old houses and industrial sites -- are available for enticingly low minimum bid requirements. They range from a vacant lot in East Lake for $75 to a spot on Main Street starting at $7,500.

There are properties across Chattanooga and reaching into Hixson, Soddy-Daisy, Signal Mountain and Highway 58. All are leftovers from the county trustee's annual tax sale last summer.

"This is the last stop for us as we try to get these properties back on the tax rolls," said Hamilton County Real Property Manager Paul Parker, who has been to 28 property sales.

Most are vacant lots, although about 40 include structures, records show. The city and county must perform basic upkeep on back-tax properties, but the budget to manage the lots is tight, Thornton acknowledged.

"A lot of them have dumping and debris," he said, "Many of the houses are falling in."

The sealed, mail-in bidding takes place this month, and the final bid-off is March 15. The redemption period has expired, so no taxes are owed and the properties are ready to change hands after the Hamilton County Commission approves the high bids following the sale.

"We try to help prospective purchasers by creating a customer-friendly environment," explained Parker. "We try to make it from being bureaucratic."

A few properties have already cycled through the sale and landed back on the list, said Thornton. Sometimes buyers think they are getting a great deal, but fail to do anything to the property and neglect the taxes on it.

Thornton and Parker said the ideal bidder is someone who has a plan to expand a pre-existing residential or business lot, or to build a new structure.

"It is very interesting to see all the motives people have when they go in there," said Parker. "A lot of people are looking for deals, but some people are dead set on getting one particular lot."

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