The Tricycle Collective is helping Detroiters buy back their homes
Wayne County is currently in the midst of the largest municipal property auction in United States history.Some 30,000 properties are on the auction block, and around 85% of the properties facing foreclosure are in Detroit.
Michele Oberholtzer watched the 2014 Wayne County Tax Foreclosure and saw that many of those properties sold to investors and speculators were occupied homes.
So she founded a volunteer effort called The Tricycle Collective to help people try to save their homes.
According to state law, properties that are behind on tax payments for three years or more must go into foreclosure.
Oberholtzer explains that in the first of the auction’s two rounds, bidding prices start, “at approximately whatever the value of debt was.” Whether that’s $5,000 or $100,000, she says that’s the stage at which the county treasurer is attempting to recoup what was lost in back taxes.
She says the second round of bidding draws a bit more attention.
“Most people do wait for round two of the auction because that is when, to put it in layman’s terms, they take what they can get, and the bidding prices start at $500,” she says.
While Oberholtzer describes this auction as a great opportunity for “everyone across the board” to purchase property in the city, it’s also a prime target for manipulation.
She says information about the auction is not well distributed, and that sometimes even the people who live in these properties don’t know their home is up for auction.
Oberholtzer adds that a large portion of these properties are rentals, and that in many cases the landlords may be misleading their tenants, telling them not to worry about that foreclosure notice that showed up at their door. Meanwhile, the landlords sometimes continue to collect rent payments and allow the foreclosure to go through.
“They often feel very manipulated and misled and abused and taken advantage of, and it’s very frustrating,” Oberholtzer says, “but it is also empowering to be able to reverse that and to correct it with proper information.”
“So what I do is I create a map, and I pull from it those properties that are in the auction and that are occupied. And then I knock on doors.”
Oberholtzer tells us that more often than not, the residents of these homes don’t know their property is up for auction when she shows up on their doorstep.
“We tell them that there is a chance that someone could buy this home, and also there’s a chance that that person could be you, and we want to make sure that you at least have the information to take advantage of that,” she says.
But it can still be tough to take the steps necessary to make the most of that information, Oberholtzer says. It’s not enough just to know your house is up for auction, there’s still a $2,500 deposit required just to place a bid.
That’s where The Tricycle Collective’s partnership with United Community Housing Coalition comes in. They’re a nonprofit in Detroit that has been doing proxy bidding for years.
“So what they’ll do is they’ll bid for someone on their behalf, and in so doing they remove a lot of those barriers of access,” she says.She adds that Detroit is a unique case because foreclosure is heavily linked with blight, citing a study by Loveland Technologies that showed one in six of the properties auctioned off last year were vacant.
“It’s so important in Detroit that we keep people in their homes if they’re willing and able to stay,” she says.
The wicket gets even stickier for those whose names appear on the deeds of foreclosed properties, according to Oberholtzer, as the law prohibits those individuals from participating in the auctions.
She explains that the law’s intent is to prevent real estate companies and other organizations from intentionally neglecting to pay taxes on a property and just picking it up for $500 at auction, but says that it has more potential to harm individual homeowners than those trying to game the system.
“I have not encountered an individual homeowner who chose not to pay the taxes, even though they could pay it, in order to buy their house in the auction,” she says.
Last year the Tricycle Collective helped 10 Detroit families buy back their homes at auction, and they are in the middle of a fundraising campaign to raise enough money to help twice as many families this year.
More information on the fundraiser and the The Tricycle Collective can be found on their website.
-Ryan Grimes, Stateside
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