Amid tight housing market, Amsterdam’s foreclosure auction attracts interest

Rashid Badwi looks at the interior of a foreclosure property at 260 Division St. in Amsterdam on Thursday.

Rashid Badwi looks at the interior of a foreclosure property at 260 Division St. in Amsterdam on Thursday.

AMSTERDAM — The tight housing market is driving up interest in the 28 homes for sale through Amsterdam’s foreclosure auction, according to Grant Egelston, one of the city’s housing inspectors.

Open houses held at 15 of the properties to give prospective bidders an opportunity to tour the structures for sale through the online only auction each attracted around 50 area residents over three days last week, Egelston estimated.

“It’s nice to see them actually looking at the houses,” Egelston said while showing a foreclosure property at 260 Division St. on Thursday.

Although the city has traditionally opened the doors of foreclosure homes on the auction block for viewing, Egelston said the limited availability of homes in the pandemic real estate market boosted interest this time beyond typical years.

While some viewers expressed interest in buying the structures to occupy themselves, Egelston said most are interested in buying the fixer-uppers to either rent out or flip for a profit.

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The potential investment opportunity of the auction properties attracted Andy Gugliemelli II to tour the homes. He is considering bidding on some of the residences to fix up for rental properties or to sell.

Gugliemelli has never rehabbed a home before, but has experienced friends who are willing to help out if one of his bids is successful.

The Amsterdam native lamented the condition of the foreclosure properties, many strewn with old belongings and even photos of families he once knew. Gugliemelli recounted spending time with friends at 260 Division St. when it was well kept.

“It’s sad,” Gugliemelli said, taking in the condition of the home. “It was beautiful here.”

The Division Street home was apparently in the early phases of renovation that left ceilings torn up in a kitchen area and stripped floors before it was seized through foreclosure. Odds and ends were strewn about the house, including a partial coil of nails.

Many of the viewers toured each of the homes asking about any open code violations and the city’s expectations for turning around the properties that are in varying states of disrepair.

Egelston acknowledged that most of the structures have violations on file, but said housing inspectors can be flexible about the timeline for addressing issues depending on the house.

“I want to see progress,” Egelston.

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Safety issues take the highest priority, Egelston said. For instance, a new roof needed at 68 Glen Ave. would be the first item a buyer would need to address.

Exterior improvements are another priority due to their high visibility and impact on the quality of life for the surrounding neighborhood.

Obtaining any required building permits from the city before performing the work to ensure that it is completed safely and according to city code is an absolute must, Egelston said.

The condition of the foundation, roofing, heating, plumbing and electric in each building were some of the biggest concerns for Joe Raczes who is contemplating bidding on several properties with a friend. They already own several rental properties they have fixed up together in the area that they are hoping to add to.

Growing up in the area, Raczes has a deeper interest in remediating homes that he has watched gradually fall into despair. Acquiring and rehabbing the Division Street home next door to his father’s house would be especially meaningful.

“This one is personal,” Raczes said. “For my dad to have to live here for the rest of his life next to this, it would be nice if there was actually something here.”

“I think has a lot of potential,” he added.

Aaron Madison is less certain the home is worth saving. After viewing the auction properties, he suggested around four of the properties might be worth investing in based on the level of needed remediation and that the rest should simply be demolished, including the Division Street property.

“It would be very hard to try and make money for anybody that’s worried about efficiency like I am,” said Madison, a resident of Saratoga County considering bidding on properties to rent or flip.

Despite Madison’s assessment, 16 of the 28 auction properties had already received at least one bid online by the end of last week. Nearly all of the bids range from an opening price of $1,000 to as much as $6,000. Only the property at 68 Glen Ave. broke the $10,000 threshold, reaching a bid of $18,000 as of Friday afternoon.

Mayor Michael Cinquanti acknowledged the auction represents the “last chance” for most of the homes that will find their way to the city’s demolition list if they are not sold.

Still, Cinquanti is hopeful the auction will yield positive results for the city due to strong home sales amidst the pandemic and the controls officials have put in place to prevent properties from being sold to owners with checkered pasts.

“We’ve had a lot of problems with auctions in the past, people we don’t know swooped in, bought homes and made them worse,” Cinquanti said. “Now we have a lot of history on people who purchased not just from us, but Schenectady and Gloversville, and we can do a much better job making sure that whoever buys these homes is going to make good use of them.”

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Before bidding on a property, prospective buyers must complete a registration form through Collar City Auctions that verifies payment information upfront.

Once the auction is complete, the Amsterdam Common Council will receive lists of the five highest bidders for each property. City officials will vet the top bidders checking for previous property tax delinquencies, code violations or foreclosures throughout the region.

The city can decline to award the sale to the top bidder for any reason before considering the next bidder and is under no obligation to sell any of the properties.

The shift of the foreclosure auction to an online only format at the recommendation of Collar City Auctions could spur interest from unwitting buyers outside the area unfamiliar with property conditions, Cinquanti admitted. Those circumstances could lead new owners to leave properties deteriorating untouched until the next round of foreclosures.

Yet, Cinquanti said the interest from locals looking to bid on properties with all available information was promising.

“We know who the buying audiences are that really went in and looked at the houses,” Cinquanti said. “We’ve never done just an online auction before and it’s going to be a test of our ability to adequately supervise and check out the winning bidders.”

However, the city has only provided interior viewings of the 15 unoccupied properties on the auction list. Cinquanti said the city is knowingly auctioning 13 occupied properties for the first time after facing extensive delays foreclosing on the homes due to the state’s eviction moratorium during the pandemic.

Several of the homes are occupied by renters who were unaware the building had been foreclosed on and now plan to bid on the structures, according to Cinquanti. He said it would have been unfair for the city to evict these individuals before the auction.

The city can legally auction the occupied homes as long as bidders are notified. The status of these properties are indicated on the auction list available online through Collar City Auctions. After these properties are sold, it will be up to buyers if they lease homes to current occupants or pursue evictions.

Although the scheduled open houses concluded last week, Egelston said anyone interested in viewing the homes can call the city’s Code Enforcement Department to request a walkthrough before the online auction ends on March 25.

“We want them to see the homes,” Egelston said.

Reach Ashley Onyon at [email protected] or @AshleyOnyon on Twitter.

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