Schenectady County

Schenectady already selling recently foreclosed properties

Just weeks after the city foreclosed on hundreds of houses, it is already selling them.
This home at 2602 Campbell Avenue in Schenectady was purchased for $1,000 just weeks after it was foreclosed on by the city for unpaid taxes.
This home at 2602 Campbell Avenue in Schenectady was purchased for $1,000 just weeks after it was foreclosed on by the city for unpaid taxes.

Just weeks after the city foreclosed on hundreds of houses, it is already selling them.

The City Council on Monday approved the sale of the first four in only its second meeting since the latest foreclosures were finalized. The city also sold two more houses from a previous round of foreclosures.

In the previous round of foreclosures, in 2012, it took months to sell the first house — and then that sale fell through.

This time, everything is in place — attorneys, inspectors and a policy on how to evaluate buyers to pick the best owners for each property.

One of the first buyers is Chris Malizia, who also bought and renovated a property from the last round.

His brother lives in that house now. This one may become a rental, said Assistant Corporation Counsel Rachael Ward.

The mayor and council have favored owner-occupants, wanting to avoid problems with absentee landlords. But, Ward said, Malizia proved himself in his complete restoration of his first purchase.

So the city approved selling a second house to him.

“The mayor is very much driven toward owner-occupants. But at the same time, if we know who the owner is and they’re in the area — they’re right down the street — it’s the perfect situation [for renting],” Ward said. “What we want is owners who really care about the property. We just want to get away from the people who were buying houses cheaply just to make a profit.”

It helped that Malizia wanted a property that city officials never expected to sell.

He bought 2602 Campbell Ave. for just $1,000.

“This would have been slated for demolition,” Ward said of the house. “It’s missing part of the roof. There’s been substantial water damage.”

Malizia will likely have to tear it down to the studs and rebuild, she said, adding that the cost of that was factored into the sale price.

Because of the roof problem, city officials rushed to get the house onto the City Council agenda for Monday night so he could get to work soon.

“He was very anxious to start, because of the weather,” Ward said. “He’s hoping to make a lot of progress this fall, before it snows.”

The only downside to the first sales is that they were both for small amounts of money. Malizia paid $1,000 while Davika Motilall bought 1062 Bridge St. for $5,000. Both houses were in poor condition.

The city also managed, at long last, to sell two nearly impossible properties from the 2012 foreclosure list.

In both cases, the owners of the property had passed the title to someone else after they were served with the foreclosure paperwork. The new owners claimed they didn’t know about the impending foreclosure, and although the city legally gained title anyway, title insurance companies would not participate in any sale.

In the end, the city simply foreclosed on those properties again in August, serving notice to the new owners, Ward said.

Then she went back to the bidders who wanted to buy each property, and asked if they were still interested.

“We told them they would have first offer,” she said.

The bidders on 805 Lincoln Ave. and 1055 Strong St. still wanted the properties, and the council agreed Monday to sell to them.

With the exception of the Campbell Avenue and Bridge Street houses, the sales are very close or more than the city was owed in back taxes.

After taxes, the city made a $500 profit on 18 Jefferson St., a $600 profit on 1055 Strong St., and a $2,000 profit on 1734 Albany St. The Albany Street and Jefferson Street houses were taken in floreclosure in 2012 and didn’t sell until Monday, along with the other four.

On 805 Lincoln Ave., the city took a $100 loss, in terms of taxes recouped.

Of course, getting enough money to pay back the taxes doesn’t cover the costs of foreclosure and of marketing and selling the properties. But city officials had said, when they began the foreclosures, that they were hoping to at least collect enough to cover the delinquent taxes.

Ward said she focuses on finding good owners, and then negotiating a fair price. The fact that the price ended up close to the tax bill was “unintentional,” she said.

The city had already written off the taxes long ago, she noted. So her goal is simpler: “Get these on the tax roll,” she said.

She expects sales to stay strong throughout the fall.

“I expect a lot more,” she said. “A lot of people have been coming in. We’re excited. We’re really going.”

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