Why is Brunswick County buying and selling foreclosed properties?
While real estate prices have been skyrocketing across the nation, some people can still get a great deal by buying from Brunswick County. For the past several years, the Brunswick County government has purchased foreclosed properties and resells them in an upset bid process, hoping it can facilitate the transfer of the property from a delinquent owner to one that contributes taxes. When a property is foreclosed on, members of the public can bid on the property in an auction process, Deputy County Manager Steve Stone said. "Typically what happens is, the public isn't really interested in the parcel so the county is the high bidder and we bid the amount of the taxes owed and our costs for having gone through the process," Stone said. "If others don't bid more for the property than the value of the taxes that we're owed, the county buys the property." In the past year, the county has sold about 40 properties through this process, with bids ranging from as low as $700 to more than $9,000. According to Brunswick County Public Information Officer Meagan Kascsak, in fiscal year 2021, the county generated $62,625.37 in revenue from its surplus property sales. :Like our Facebook page for all things Brunswick County  But some of these properties have sold for tens of thousands of dollars below their assessed tax value, and some are even sold for less than the county paid for them. One 2.64-acre Shallotte property worth more than $67,000 was sold last year to a Manhattan Beach, California, land investment group for $9,315. The county paid $9,312.15 for the property in 2020, netting a profit just under $3. Stone said though the county does generate revenue from the sales, the goal is not to make money but to expedite the transfer of ownership. Most of the properties are residential but without access to sewer or water services they provide no use for the county. "We're normally not in the home building business and many of them... are in areas that were not suitable for conventional septic tanks," Stone said. "So it wasn't going to be easy for people to build a home." To make sure the county is getting a fair deal on the sales, about five years ago Brunswick County created a policy setting a minimum offer for bids. Prior to that, the county was deciding on each bid individually. The policy outlines one metric for properties the county has held for 10 years or longer and another for those held less than 10 years. "We just sat down and looked at parameters that seemed reasonable to set the threshold and then we recommended a policy to the board and they approved it," Stone said. For properties held for 10 years or more, a bid must be at least $750 or 25% of its current tax value, whichever is greater. In the past year, however, one 0.24-acre Boiling Spring Lakes property was sold for less than its minimum allowable bid. The Maple Drive property was purchased in 1986 with a current tax value of $11,000 but was sold to Maryland resident Michael William Watts for just $2,000, which is $750 less than the policy-mandated minimum based on its tax value. "Our tax values are based upon mass appraisals, it's not like a commercial appraiser goes to every single tax parcel in Brunswick County and does a true appraisal of the value," Stone said. "We do believe that our tax values in aggregate very accurately reflect market value but it's just when you drill it right down to an individual parcel level it may not be exactly market value on any given day. Truthfully. market value is subjective." Selling for less  Due to the county's purchasing policy, several properties were also sold for thousands less than the county paid for them, though technically meeting the minimum bid requirement. North Carolina resident Michael Westmorland paid just $1,500 total for a pair of 0.38-acre Boiling Spring Lakes properties the county purchased in 2006 for more than $4,650 each. The county lost more than $7,000 on those sales. For properties held for less than 10 years, a bid must at minimum match the cost that the county paid for the property or 50% of its current tax value, whichever is lesser. Most of the properties the county has sold in the last year fall under this category. This has led to several properties selling for just pennies more than the county's cost, despite being assessed for a much greater value. Two 2-acre properties in Boiling Spring Lakes worth $30,000 each, for example, were sold to Jesse and Felicia Jayne for $2,600 and $3,012 respectively. The first property brought in less than $82 in revenue for the county, while the other was sold at cost. Most of these properties aren't what could be considered high-demand, with many irregularly shaped. One parcel, for example, is about 30 feet wide and 1,100 feet long, which was likely used for a railroad. "A lot of them never had a home built on it, but they're residential lots," Stone said. "There are a few odds and ends that obviously, I'm not exactly sure how the parcels even came to be." Most buyers seem to be interested in these properties as an investment or to eventually build a home on when infrastructure in the area expands, Stone said. Only three properties in the past year were sold for more than their assessed tax value, all in Shallotte to the same Fayetteville resident. Anyone interested in Brunswick County's available surplus property can visit https://www.brunswickcountync.gov/surplus-land/. Reporter John Orona can be reached at 910-343-2327 or jorona@gannett.com.