Buyers of vacant homes complain of red tape, delays

September 13, 1994|By Tanya Jones | Tanya Jones,Sun Staff Writer

More than four months after city-hired auctioneers sold 60 vacant houses in a effort to revive Baltimore's neighborhoods, none of the successful bidders has moved in and few renovations have begun.

Several people who bid on homes during April's Baltimore Home Festival Auction complain of delay, a lack of information from city officials, confusion over what financial institution is handling loans, and renovation plans that are largely out of their control.

"It's been a fiasco," said Eric Goods, 38, who bid $45,500 on a three-story, city-owned row house in the 200 block of E. Lafayette Ave. "We're going on half a year that this whole process is taking, and you don't have anything to show for the expenditures you incurrred."

Robert Helmacy, who bid $40,000 on the house next door to Mr. Goods', says he sold his Pasadena home in two days to qualify for the auction, and is eager to move.

He and other bidders, he said, were told during pre-auction information sessions that bidders could move in within six or seven months. But the 38-year-old ironworker, who is living in an apartment around the corner from his future home, wonders, "is six months going to run into eight months to a year?"

It might. Senior loan officer Michael Lee of the quasi-public Community Development Financing Corp. (CDFC), which is handling most of the mortgage and construction loans, says, "We hope to have people in by Christmas."

And city officials aren't sure when Mr. Goods, Mr. Helmacy and the other East Lafayette owners will be able to move in.

"I don't have a date," said Tom Jaudon, chief of the city's Homeownership Institute, which sold nine homes in the 200 and 300 blocks of E. Lafayette Ave. and one in the 700 block of E. 22nd St. through the auction.

Mortgage credit checks, income verifications and property appraisals have drawn out the process of approving loans, according to CDFC and city officials.

The auction was designed to attract homebuyers into Baltimore neighborhoods and to rehabilitate houses owned by the city, state and federal governments. Some were in poor shape -- the East Lafayette Avanue homes, for example, are littered with trash, and the wood floors have rotted through, leaving gaping holes.

Bidders agreed to live in their properties for at least five years, and the city promised to pay for renovation costs above the bid price if owners occupied the homes for at least 10 years. The CDFC financing also provided low interest rates for buyers.

Sixty houses were sold, for bids ranging from $25,000 to more than $60,000, according O. Jesse Wiles, president of Asset Property Disposition Inc., one of the two Atlanta-based companies that ran the auction.

But the houses have been tied up in a morass of paperwork.

Ward Morrow has been left dangling since he bid $25,000 on a two-story Pratt Street row house owned by the state. He said an auction official told him after bidding closed that he had to pay $30,000 for the house, the minimum the state would accept.

The state has since agreed to accept his original bid, but the city, which was to receive a portion of the price toward renovating the home, rejected it. "The city rejected his proposal and the state's proposal because it would have cost the city more money," Mr. Jaudon said.

That has left Mr. Morrow waiting, in an apartment. "I still don't know if or when I'm going to get this house, so I don't know how long a lease to get."

Other buyers aren't sure they like the houses they will be getting.

Mr. Helmacy, Mr. Goods and a neighboring homebuyer, Charles Smith, feel trapped by the renovation plans.

For example, blueprints call for contractors to divide a large, top-floor back room into two nine-foot-wide bedrooms in several of the East Lafayette Avenue houses. But the three buyers say they want to keep the rooms the way they are, stretching the width of the houses.

"If I get what they give me, I'm going to come in and rip all that back out," said Mr. Smith, director of the Greenmount West Community Planning Association. He plans to use the room, with three windows, as a studio for stained-glass making.

But Mr. Jaudon said plans for the East Lafayette Avenue homes can't be changed because the city already has hired the contractor, and because bidders were allowed to see renovation plans before the auction. "They are buying a finished product," he said.

Many of the bidders, whose homes are being handled by a city-hired construction management firm, are less restricted. They have met or will meet with contractors to choose such details as carpet colors, bathroom tile and kitchen cabinet styles.

But Mr. Jaudon said the East Lafayette Avenue buyers can't make such choices because those details were already specified for the contractor.

Despite delays and the obvious dissatisfaction of some bidders, Mr. Jaudon and others running the program say the auction has been a success.

"We're certainly happy with what we sold," Mr. Jaudon said. "Any time you can sell vacant houses in the city of Baltimore, it's a success.

A city-hired contractor has begun renovating at least two of the East Lafayette Avenue houses and should be finished with them by Nov. 19, said Rudolph Janssen, director of construction with the Department of Housing and Community Development.

But the city needs zoning approval to transform the other properties on that street into two-unit houses. If the board approves the plans, renovations should be completed within 90 to 120 days, Mr. Janssen said.

Meanwhile, the CDFC has approved 37 mortgage and construction loans through its Vacant House Loan Program.


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