New Orleans’ largest online property auction is off to a running start, with potential buyers putting up cash to get the ball rolling on 226 of the parcels in the first six hours they were available Friday.
The first-day interest saw thousands of individuals browse listings of properties that have been tax-delinquent for more than five years. They include a French Quarter condo, a whole block of parcels in New Orleans East and a plethora of vacant lots scattered throughout the city.
City officials said they expect the number of potential sales to grow.
“We expect interest to grow as potential buyers spend time scouting out these properties in person and then returning to the website to put down a deposit and start the research and notification process,” said Brad Howard, a spokesman for Mayor Mitch Landrieu’s administration.
At the same time, administration officials were forced to spend time tamping down concerns about whether buyers could be left holding the bag if issues arose with a property’s title. That will not be the case, Howard pledged, saying the city would stop any sales that did not include title insurance and would refund the would-be buyers’ money.
More than 16,000 unique users visited the auction site at www.civicsource.com between noon and 6 p.m. Friday, accounting for about 165,000 individual pageviews. They began the pre-auction research process on 226 properties, or about 13 percent of the 1,747 available. The total is less than the 3,000 city officials had originally projected would be involved in the auction, but more parcels will be added as they are cleared for sale.
To begin the auction process, a bidder must put up a deposit of $650 to start an investigation into the title. That process ensures the city does not spend money researching properties that no one is interested in buying and lets the market drive the research schedule, Howard said.
Editor's note: The information in this map is based on city records, and all addresses might not be accurate.
In the 90 days after a deposit is received, researchers will make sure there are no problems with the title and that the city took all the proper steps to permit the property to be sold at auction. The property’s owner will be notified of the impending sale and given a final chance to settle up with the city.
If problems are found, the auction of that property will be stopped and the would-be buyer’s deposit will be refunded. The same thing will happen if the property’s owner settles the tax debt.
If the property moves to auction, it will be sold to the highest bidder, with no minimum bid. The winner will be responsible for covering the $650 deposit — which will be refunded to the original depositors if necessary — as well as closing costs of about $3,400, plus whatever amount they bid.
Some concerns popped up Friday after First American Title, the company tapped to provide title insurance on the properties, announced it was not guaranteeing to insure all properties in the auction. Decisions on whether to provide insurance on a particular property will be made within “a reasonable amount of time” after the research period is up, the company said.
“We will not allow the final sales to occur unless there’s title insurance,” Howard said.
Follow Jeff Adelson on Twitter, @jadelson.