Buying Foreclosures in Targeted Areas in Wisconsin
October 1st, 2009 by 
jfoxx
The city council of Janesville in Wisconsin has proposed buying foreclosures in targeted areas. The proposal involves purchasing foreclosed homes at the cost of the unpaid property taxes.
These properties were foreclosed because their owners failed to pay their property taxes. The council has suggested purchasing three tax-foreclosed properties located in the Fourth Ward area of the city.
The three foreclosure homes are part of the city’s intensified mission to purchase distressed properties in vulnerable communities and either renovate them or demolish them. Two of these foreclosure houses have historical significance.
For this year, the city of Janesville has acquired four foreclosed houses using the federal stimulus funds, the parkland money, federal block grant funds and tax increment financing funds.
The three foreclosed properties that the council is considering to purchase will be financed by tax increment financing. According to industry experts, cities can use the funds from tax increment financing to rehabilitate or revitalize residential areas.
Experts said that buying foreclosures to rehabilitate or prevent them from becoming blights is consistent with the plans of the city and its mission to invest in improving and revitalizing the historical central neighborhoods in the area.
Under the proposal, Janesville would purchase the three distressed homes for a total amount of $18,597, including the closing costs of $1,200. Meanwhile, about $3,797 is scheduled to be received by the city from Rock County for its portion of delinquent taxes. The three foreclosed houses have been tax delinquent since 2005.
Each year, the county has been foreclosing properties that are tax delinquent. The city of Janesville has the first priority to buy the tax foreclosures before they will be placed on public auctions.
Janesville is required to buy the properties at prices equal to the unpaid taxes, charges, special assessments, closing costs and interest. The council has suggested that two of the three houses will be renovated and sold while one will be demolished. It has allotted about $180,000 to renovate the two foreclosed houses.
Meanwhile, the city has been trying to maintain, repair and preserve the exterior of two historic foreclosed houses that it is planning to buy. The two historic homes are both 1855 Greek Revival and have been contributing structures in the district.
Experts said that buying foreclosures at very low prices is within the city’s plan to improve the neighborhood.
