Real Estate Journal Online

Before hurricane Katrina, the city of New Orleans had a blight problem. In the wake of the storm – indeed, nearly six years after the fact – the natural disaster is still escalating the problem. However, the city hoped to alleviate financial woes and diminish its blight problem via a tax auction last Saturday[1]. The state purchased nearly 100 properties in the wake of the storm. The properties were damaged during the hurricane and about 20 remain vacant. They are all in disrepair. While bidding wills start low – at $1,000 – bidders must “agree to rehabilitate or begin construction on the property within a year” in order to keep the properties, which are currently at risk, free from blight.

The auction initiative, called “blight fight,” will hopefully provide a working method for restoring the estimated 43,000 to 60,000 blighted homes around New Orleans, many of which were purchased by the state in the wake of Katrina via the state’s “Road Home” program in an effort to help homeowners recover and move on[2]. As of press time, results from the auction were not yet public, but local news outlets were calling the auction “the latest step in recovery” for the city.

Tax lien bidders are known for their interest in “buying low,” and this auction seems to fit the bill even though it is a little unconventional. However, the additional requirements could make an investment in this blight auction more expensive than many potential bidders may wish. Would you invest in “blight fight” properties?

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Let us know how you feel about New Orleans’ attempts at “blight fight” below.

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[1] http://www.businessweek.com/ap/financialnews/D9MB3AU80.htm

[2] http://realtybiznews.com/new-orleans-auction/9871887/