Failing Tax System Creates Detroit Foreclosed Homes for Sale

Detroit foreclosed homes for sale is mounting and the numbers are expected to continue climbing in the coming months. Industry experts said that the increasing foreclosure trend is an indication that the tax foreclosure system in the Michigan city is failing.

Driving around the city of Detroit, one could see older ranch-style houses that were constructed and financed by religious organization and wide, open spaces where houses have been burned down or demolished.

For the October auction, Wayne County officials listed 15 vacant land holdings in just one street. These vacant lots were foreclosed after their owners failed to settle their taxes which were overdue for three years. At the auction, none of the land holdings were sold at the $500 minimum bid.

Meanwhile, residents were not aware that many properties in their neighborhoods were on Detroit foreclosed homes for sale. Industry experts said that many people are struggling financially, leaving the city with no option but to send workers to do the mowing of lawns in vacant and foreclosed properties.

Detroit was once an industrial powerhouse before the economic downturn and the collapse of the housing market. Now, it is viewed as a dying city with 28 percent unemployment. Its foreclosure system is based on the belief that the housing markets will recover and buyers must continue to rule.

In a recent tax foreclosure auction, over 80 percent of properties on sale failed to find interested buyers. The immediate goal of Wayne County officials was to offset the total cost of holding the foreclosure auction in a ballroom in downtown Detroit.

Sales of properties in the foreclosure auction of nearly 200 transactions reached more than $250,000. Industry experts said that public tax foreclosure auctions are good in terms of bringing in quick cash. However, the events do nothing to prevent or control the blight in neighborhoods.

Some proponents of change said that it would be better for Detroit and other cities across the country that are experiencing a declining growth, to phase out tax auctions. They believe that a land bank program is the right way to reduce the number of foreclosure properties. The program allows selling of more valuable homes through mortgage brokers to entice new residents.