While previous buyers passed on 18 oddly shaped and nearly unbuildable tax title properties for sale at the county, a group of investors and adjacent landowners who showed up for a Friday morning Spokane County auction were willing to get into small bidding wars over the unusual pieces of land.
The properties for sale ranged from a lot where a house had been demolished in North Spokane to a 50-foot long sliver of property that was 2 1/2 inches wide.
But Spokane County Engineer Deborah Firkins said residents should watch county property auctions like Friday’s closely, because many of the properties sold could affect the value of the land they already own.
Firkins said buyers in previous auctions have purchased land that adjacent owners thought were a part of their own parcels. They then go to other property owners in the neighborhood and offer to sell it for far more than they paid at the auction.
Properties often have unattached pieces, because, when they were originally developed, the builders didn’t survey the land correctly before building and accidentally built the house slightly off from where they were supposed to go and had to buy a smaller parcel to complete the lot. When the original property owner sold it afterward, the second parcel was sometimes forgotten or the property owner didn’t realize they had to pay taxes on both parcels.
The land was then foreclosed on by the county, often without adjacent property owners ever knowing the land they are building on doesn’t belong to them. Firkins said she has sent landowners letters that the pool they own is halfway on county property, that the eaves of their roof are on property they don’t own, or that they actually only own half of their garage.
Firkins recalled one man who used to stop by auctions about once a year and buy vacated alleys and other small properties. The man would park his motor home on those parcels. When the adjacent landowners would call police, he would show that he owned the land and couldn’t be evicted. Nearby landowners would have to pay money to get him to leave the area.
More than a dozen potential buyers gathered at the tax title auction Friday. Many of them were there to buy property adjacent to their own or on behalf of a family member or employer who couldn’t attend the auction but wanted to increase their property value.
The 18 properties for sale Friday were properties no one bid on at a previous treasurer’s auction in December. The properties were cheaper than they were at the previous auctions because the treasurer’s fees were removed.
The leftover tax title property sale happens every year in August, and Firkins said she was surprised how many more parcels than usual sold. Last year, three of eight properties sold. This year, 14 of 18 properties sold.
Ron Green, an agent for a landowner who owned property adjacent to one of the parcels for sale, said the neighborhood hadn’t realized the county owned the land. When the property went up for sale at the yearly auction, Firkins sent adjacent landowners letters notifying them the property was available.
Green said that, when his client bought his home, he believed he was buying a larger parcel than he actually was and that the parcel they purchased Friday is already a part of his fenced yard.
“They’ve been thinking they owned it the whole time,” he said.
Alex Rehberg, a real estate agent and investor who also bought two properties on the auction, bid against Green for the property but when Green said he owned the nearby parcel, Rehberg withdrew.
“He seemed like a nice guy, so I don’t want to start out mean and aggressive,” Rehberg said.
If Green hadn’t been at the auction, Rehberg said he would have purchased it and contacted the neighbors, because if they bought it from him, they could have greatly increased their property value.
He said he bought two other properties as investment opportunities, on advice another real estate agent gave him. He said the people who want those properties the most often don’t attend auctions and that he can post the land where more people who are interested in it will see it.
“These properties are weird,” he said. “You have to have kind of a different vision for the land if you want it, unless it’s adjacent to something.”
Phil Johnson, a real estate broker who was also buying land at the auction, said he sees the small parcels as an investment opportunity as well and hopes eventually the zoning will change.
The buyer Johnson bid against the most during the auction was Art Tochinsky, a heating and air conditioning business owner who isn’t a professional investor but who loves real estate.
“You can buy some cool properties for cheap,” he said.
Tochinsky attended his first auction around five years ago, after seeing it advertised at a foreclosed property.
He and one other man were the only people at the first auction he attended. Friday, there were more than a dozen people bidding on land. Over the years, he’s purchased four or five parcels. He bought three Friday. He attended the auction with a cousin who was looking to buy a parcel adjacent to another property he was buying already and with another friend who was bidding.
Tochinsky said some of the properties he’s purchased are near each other and that he bought them for a few hundred to a few thousand dollars. He said with a road vacation or an easement, the land could someday be usable.
Firkins said some of the larger parcels of land for sale Friday had a house that was condemned, could be a wetland or have some sort of issue that makes it impossible to dig a well or install a septic system.
“There’s a reason nobody wants it,” she said.
Firkins said she rarely auctions off houses, but usually homes sold at tax title auctions are condemned and anyone who bought one cheap and tried to live in it would be in danger. She said a lot that sold at Friday’s auction for about $34,000 was more expensive than it initially appeared. It used to have a structure on it, which was knocked down by the city of Spokane, and that the buyer will have to pay off a $6,000 water bill from the previous owners before the city will turn on water for the property again.
She said buyers will often pick up empty lots at auctions, because a vacant large piece of land in a growing city could eventually be worth a great deal, once all the issues the land has are taken care of.
In the past, Firkins has auctioned off a house for a dollar, because it went so long without being sold. Before a piece of land can be sold for less than its assessed value, or less than the total taxes owed, it has to go through a long, multistep process. Before commissioners approved the process several years ago, Firkins managed properties the county had owned since 1910. Now, most of the land the county owns is from recently foreclosed upon property, so $1 sales are less common and there are more buyers.
Before showing up to an auction to acquire several new properties for just a few hundred dollars, Firkins said every potential buyer should research their chosen parcel carefully, talk to a lawyer and understand the land’s history.
“I hope nobody gets hurt from these things,” she said. “But I can only do so much.”
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