Millionaire scoops up all 650 homes in Michigan county’s foreclosure auction
Bill McMachen paid only $4.8 million for the properties in Macomb County — the price of all the back taxes owed. Other potential bidders have cried foul.
By Anthony Bartkewicz / NEW YORK DAILY NEWS
Published: Monday, August 6, 2012, 1:18 PM
Other bidders felt left out of the process.
- Government proposes new rules to ward off foreclosure
- New York homeowners are in major distress, study finds; pre-foreclosure notices are through the roof
- No place is immune: Tony Manhattan sees spike in foreclosures
- Underwater: 11 million U.S. homeowners owe more on their homes then they’re worth
- Home prices drop 0.2 percent in August, more devaluation expected
- Foreclosed ‘shadow’ housing reaches 2.1 million units, prices likely to drop
Bill McMachen is a new homeowner – 650 times over.
The millionaire former yacht dealer and harbor owner snapped up hundreds of foreclosed homes in Macomb County, Mich., for a cool $4.8 million, WJBK-TV reported.
He says he plans to sell some of the homes – for an estimated profit of $2 million – and donate the ones he can’t sell to charitable organizations.
That will make the charities happy, but some other would-be buyers had the opposite reaction to McMachen’s impulse purchase.
One Canadian buyer told WJBK he spent weeks researching the real estate market before traveling to Michigan, and was prepared to shell out plenty of money.
But Macomb County officials announced at the start of last Tuesday’s auction that all 650 of the foreclosed homes could be had at once for the cost of the back taxes owed on them.
Bill McMachen picked up 650 homes for $4.8 million.
McMachen bit, thwarting hundreds of other buyers.
“If we knew it was going to happen like this, we wouldn’t even have spent any time,” the Canadian investor said. “They could’ve made more money, I mean triple the money they made.”
County Treasurer Ted Wahby was sorry for the investors who missed out, but not too sorry.
Bill McMachen bought every tax foreclosed property in Macomb County, Mich.
“People who are going to buy five or 10 houses weren’t buying them because they wanted to move in,” he said. “They wanted to make money on them, and God bless them, I wish they could have, but that’s not my mission. I have a job to do. I have to collect the taxes, and that’s what we did.”
What a load of horsesh*t...the FIX WAS IN.
I am a veteran of auctions, and know how the auction game is played.
Yes, via taxes owed, a Local Gov’t can sell them off at auction….the rules vary given the jurisdiction.
However, the City technically owns an asset, and has a greater responsibility to get fair market value, thus sell to the HIGHEST bidder.
I have been to auctions whereby there are several similar items. EXAMPLE: say their are 10 similar items . A price is established on the first one up for bids. Say the top bid price is $25 dollars .Then the auctioneer offers the remaining (9) items to the bidder for $25 , who is given first dibs to take all 9 or any amount they chose ie say (5). Then the items are offered to others for $25. If no takers…they are re-auctioned….I have seen them go for less and also go for more.
It appears that the City head bureaucrat decided at the last minute that 650 homes could be acquired as a single lot, which pulls the rug out from others who wished to bid. Why ? Someone bribed?..Political connections ? The buyer has already stated they estimate they will earn $2 Million profit . Well, what if he can’t sell….or people boycott…then he is in the same boat …and may be foreclosed on..and the circus continues.
The City could have set reserve bids….got a feel for the market and called it off if bids were too low. Regardless, they deprived others of a fair opportunity to bid, and IMHO that was the plan, I suspect they knew that at least ONE person would buy them all if the TOTAL price was set.
The City, a usual was thinking short term..quick buck…versus long term..ie try to spread the risk and attract people to the area and build up the City. Personally, I wouldn’t live there..I already get a feeling the City is corrupt.
This is eerily similar to what happened in history. When an economy collapses ..”carpetbaggers” come in and buy up assets for pennies on the dollar. The entire process from start to finish is FIXED and as crooked as a dog’s hind leg.
Again, the reason I post these times are to warn people that this type of economic fallout can very easily happen here in Canada in the near future.