Cuyahoga County Auctions Tax Delinquent Property Stuck In Limbo

This week, Cuyahoga County is selling properties that are stuck in the real estate version of purgatory.

The forfeited land sale, as it’s known, auctions off houses, buildings and vacant land that nobody would buy at sheriff’s sales. The sale is scheduled for Wednesday through Friday this week.

The properties are offered for the cost of unpaid taxes plus foreclosure fees. If there are no takers, the opening bid is reduced: often, $500 for houses and $75 for vacant land.

Properties with higher land values may be available at a reduced bid in the thousands or tens of thousands of dollars.

The new owners won’t be responsible for the old taxes, but buyer beware: Properties may be in bad shape, and some may be razed in the near future.

“We do try to put as many warnings out there as possible that, you know, you need to have called the city and, you know, asked if this is condemned or set for demolition,” said Michelle Spaqi, who works for the county fiscal office and runs the auction each year.

The county will try to auction off more than 600 properties that together owe more than $12 million in back taxes. These properties have all gone through tax foreclosure by the Cuyahoga County prosecutor’s office. They’ve also all failed to attract bidders at two sheriff’s sales.

Spaqi said she’s hoping to sell 200 to 250 properties and bring in around $1 million. Of that, she said, around $400,000 would offset what’s owed to the county in taxes.

The addresses for sale this week are concentrated in neighborhoods hit hardest by the foreclosure crisis: Cleveland’s east side, East Cleveland and Maple Heights.

Some structures are dilapidated. Others are in better shape and may even still be occupied.

“If you buy a property that’s occupied from the forfeited land sale list, those are effectively tenants in your property,” Spaqi said. “They have all the right to be there that you do, and they have all the right to notice and eviction that any other tenant would have.”

Spaqi said tenants are encouraged to buy from their delinquent landlords, provided they’re not family or tax delinquent themselves.

Starting in 2008, the county bumped up the number of auctions to two a year. Last year, the county went back down to one sale annually.

Anticipating a big crowd, organizers are holding the sale in the convention center for the first time. The most recent sale was in the chambers of county council.

“We had so many people show up to our last forfeited land sale that we had to tell them to leave, because we were afraid of fire hazards in the building,” Spaqi said.

But the auction’s popularity may not necessarily be a good thing, according to Frank Ford, a researcher with the Thriving Communities Institute.

“It doesn’t necessarily mean that everybody showing up at the sales has got the right approach or knows what they’re doing,” Ford said.

He said forfeiture sales can attract buyers who want to make quick cash flipping properties, rather than those planning to invest in neighborhoods.

Ford examined a sample of almost 1,800 Cleveland properties sold at forfeiture auctions between 2010 and 2015.

He found that 66 percent of them ended up in what he termed “failure.” Either they were condemned or demolished, became tax delinquent again or were found to be vacant and in poor condition, Ford said.

“That’s two thirds of the properties ending up in a non-beneficial outcome for Cleveland neighborhoods,” he said.

Almost all of the distressed properties examined, Ford said, were in largely African-American parts of the city.

Ford credited the county for doing a better job screening buyers.

The county requires bidders to register before the sale, Spaqi said, and anyone with delinquent taxes is barred from participating. She said the county also checks LLCs, which investors often use to buy property. The LLCs must be registered with the Ohio secretary of state’s office.

The Cuyahoga County Land Bank can pick up the properties at any time. If there’s no interest from buyers at auction or from the land bank, Spaqi said, the properties go back on the list for another sale.

Explore the properties on this year’s forfeiture sale list. Locations on the map are based on addresses provided by the county. Some addresses may be incomplete.

Below are a few examples of properties on the list:

Vacant Lot, East 118th Street, Cleveland

This property, to the left of the tree in the photo, is now vacant land.

A couple bought the home that used to sit here in 2004. They took out an $81,700 mortgage with NetBank, according to county records. Two years later, they were in foreclosure. In 2007, NetBank filed for bankruptcy.

Fannie Mae, the government-sponsored mortgage enterprise, bought the house at sheriff’s sale in 2008 and sold it to a new owner for $1,900. The unpaid taxes on the property date back to that year.

The county prosecutor’s office filed for tax foreclosure in 2016, the year the house was demolished. There were no buyers at sheriff’s sale, and now the land can be available for a reduced bid of $75 at forfeiture sale.

The total value of unpaid taxes is listed at $21,809. To the north of the property are a vacant lot and two vacant homes.

Alhambra Apartments, Wade Park Avenue, Cleveland

Built in 1902, the Alhambra Apartments were purchased most recently in 2002. Unpaid property taxes are listed at $148,032.71 and date back to 2007.

The property was added to the state forfeiture list in 2015 and is available at auction for a reduced bid of $10,000.

House, West 105th Street, Cleveland

Taxes haven’t been paid on this house since 2008, according to county records. The county filed for foreclosure in 2016. There were no buyers at sheriff’s sales this year.

The county lists $29,788.63 in unpaid taxes on this property. The reduced bid at forfeiture auction is set at $500.

Apartment, ​ East 114th Street, Cleveland

Unpaid taxes on this two-story apartment building date back more than a decade. The county lists the value of those unpaid taxes at $15,117.

The county prosecutor’s office filed to foreclose in 2011. There were no buyers at sheriff’s sales in 2012. It was forfeited to the state in 2013.

In 2016, Cleveland housing court approved a search warrant to check for internal code violations. A copy of the warrant is still stapled to a board across the front door.

It’s available at auction for a reduced bid of $500.

House, Maple Heights

According to the county, $43,798.52 in unpaid taxes are owed on this Maple Heights home. That’s close to the county-estimated value of $45,000.

The county filed for foreclosure in 2015, and there were no buyers at sheriff’s sales in 2017. It’s available for a reduced bid of $500.