Despite disagreement as to whether the costs will justify the result, City Council voted to move ahead with the renovation of a home formerly on the tax foreclosure list from Macomb County.
The house in the 21000 block of Bayside was purchased in July by St. Clair Shores as part of a lot of 26 parcels on the Macomb County Tax Foreclosure List. That group included 15 homes, seven vacant lots, three condominium units and one commercial property — the former Citgo gas station on Harper Avenue between 12 Mile and 13 Mile roads.
All 26 properties had to be bought by the city, or refused; the total cost for the properties was $255,732.
Community Development and Inspection Director Chris Rayes said the house is structurally sound; it was just owned by “a gentlemen that did renovations that did more harm than good.”
“It will be a nice home when it’s done how we’ve done … other homes,” he said at the March 18 City Council meeting.
The low bid, from Mando Construction in the amount of $80,621, will pay for the construction of a new garage and driveway extension, as well as a lot of electrical work and renovations to the kitchen. With the house costing the city about $20,000 to purchase in the tax foreclosure listings, Rayes said fair market value for the home — with a garage — would be at least $130,000.
But Councilwoman Candice Rusie disagreed with that estimate.
“I looked at the houses that actually sold in the last year within a one-mile radius,” she said. “The highest one was $130,000, next was $114,000, $110,000. (The) average selling price being $87,000. I don’t think we’re going to get that. The bank will never finance that $130,000 … even if it’s all fixed up.”
Rayes pointed out that it would be a $30,000 loss to the city if the house was torn down.
“Even if you sold it for a $30,000 loss, you’d be at the same place,” he said.
“We’re not actually in the business to make as much money off of these,” pointed out Councilman John Caron.
He said the program is more about reinvesting in the community.
“Get another family to move to St. Clair Shores — I think that’s a good thing,” he said. “I think that’s the intent of the program.”
He made a motion, supported by Councilman Ron Frederick, to award the bid for construction. The motion passed 6-1, with Rusie opposed.
Councilman Anthony Tiseo, a member of the tax foreclosure committee that reviews the homes on the list — and bids for their renovation — before it comes to Council, said that this was a way to improve the neighborhood, which should be more important than making money on real estate.
“There’s some pretty dumpy homes on that list that we do tear down,” he said. “In my opinion, Bayside, whether it’s a break-even point or loses a few thousand dollars … you take a nice neighborhood and you make it even nicer.”
He said he agreed to be on the committee to make sure homes weren’t getting just put back on the market as-is, torn down or turned into rental properties.
“If we’re going to put the money in them and bring people to our city to live here, I’m all for it,” Tiseo said. “Overall, this project’s made money already and it’s done wonderful things for the city.”
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