Economic Development, Government, and Real Estate

In reality, county has few tax foreclosures

West Michigan counties also have fewer than their counterparts on the other side of the state.

October 20, 2012
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Although there were 309 tax-foreclosed properties in Kent County this year — the most in the past seven years — that number was still the third-lowest across an 11-county comparison.

Only Ottawa and Washtenaw counties had fewer tax foreclosures, with 105 and 274, respectively. At the same time, Kent County had the lowest percentage of tax-foreclosed properties among the counties, at 8 percent. Washtenaw County was at 9 percent and Ottawa County was at 11 percent.

Kent also had the lowest percentage of tax foreclosures in two of the other seven years, tied for the lowest percentage in another year, and finished with the second lowest percentage in three years.

For contrast purposes, Wayne County had the most tax foreclosures this year: 22,505. Twenty-one percent of all the properties in Wayne made the foreclosure list.

“We are still way low in comparison to other counties,” said Commissioner Michael Wawee, who also chairs the Kent County Land Bank Process Subcommittee that is looking into how the land bank buys properties from the county.

“We’re actually doing pretty well,” said County Treasurer Kenneth Parrish, who chairs the Kent County Land Bank Authority and whose office conducts the public auction each year.

This year’s tax-foreclosed properties actually were credited by the Treasurer’s office to the 2009 tax year because it normally takes an owner three years to go from having a property in good standing to being in forfeiture and then going into foreclosure. So when 2013 rolls around, a property that makes next year’s foreclosure list will be based on its standing in the 2010 tax year.

Parrish reported that there were 3,671 properties in forfeiture earlier this year and some will fall into a foreclosed status April 1, the date properties make the foreclosure list. The current forfeitures are only 21 more properties in that tax-delinquency stage than were in the same phase last year.

“In Ken’s office, we have a hardship policy,” said County Corporate Counsel Daniel Ophoff. Under that policy, property owners can be given an additional 60 days to make good on their back taxes. Owners are also charged 4 percent interest and a 1 percent administrative fee on their owed taxes. Those two charges are added to the delinquent-tax amount; the total makes up a property’s minimum bid for the first public sale.

This year all but nine properties were purchased at the two sales. Those sales were worth about $2.4 million to the county, a recent record.

By way of comparison

Here is an 11-county comparison of tax foreclosures for the last seven tax years from 2003 through 2009, and for the corresponding last seven foreclosure years from 2006 through 2012. The data was compiled by the Business Journal from information made available by the Kent County Treasurer’s office, which gathered the outlying county data from those respective offices.

The following chart shows the total number of tax foreclosures for each of the 11 counties over the seven-year period from 2006 through 2012 and the annual average of foreclosures during that time.

County Total tax foreclosures Annual average of tax foreclosures
Ottawa 263 37.6
Kent 914 130.6
Kalamazoo 1,020 145.7
Ingham 1,342 191.7
Washtenaw 1,396 199.4
Muskegon 1,883 269
Macomb 2,148 206.8
Saginaw 4,814 687.7
Oakland 5,329 761.3
Genessee 12,842 1,834.6
Wayne 72,990 10,427.1

The data reveals that the West Michigan counties of Ottawa, Kent and Kalamazoo had the fewest number of tax-foreclosed properties of the 11 counties for those seven years. Only Washtenaw County in southeast Michigan came close to those three, and Muskegon County had fewer foreclosures than five of the six eastern counties. The West Michigan counties also had some of the lowest percentage of tax foreclosures over that stretch.

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