Published: March 06, 2008 10:13 am      

Buyers board bus for tour of foreclosures

TRAVERSE CITY -- Mark and Sandy Piotrowski flipped through a binder of foreclosed home listings as they rode in a packed tour bus bound for another bank-owned property.

"It can be a flip, a fixer-upper, a rental; we are just looking for a deal. We are kind of interested in foreclosure homes," Mark Piotrowski said.

"We went on a tour two weeks ago and you get to see a lot of homes in a short amount of time," Sandy said.

The Traverse City couple were among 16 potential homebuyers who boarded Sherry White's Repo Buyers Bus Tour on a recent Saturday. White, a real estate agent with Coldwell Banker in Traverse City, started the tour in February, an effort inspired by a similar operation in California and fueled by demand for the growing list of repossessed properties.

"I did the research and there were enough homes to do a tour for three hours and take people around," White said. "It seemed like the foreclosures were selling quicker than your typical listing, so I kind of played off that market. There just seems to be an urgency behind homes that are foreclosures."

In Grand Traverse County, the number of foreclosed properties skyrocketed from 179 in 2006 to 291 in 2007, about a 62 percent increase. Seventy-four properties are already listed in foreclosure for 2008, said Peggy Haines, county register of deeds.

The local foreclosure boom echoes a national slump in the housing market and Michigan is among the top 10 foreclosure states. In January, the U.S. foreclosure rate equalled one filing for every 534 homes. Bank repossessions are up 90 percent compared to the same time last year.

"It used to be the farm home and the low-income people that were in the foreclosures, and that's no longer the case," Haines said.

White charges $5 for the bus tour and the group recently stopped at eight different bank-owned homes ranging from $165,000 to more than $300,000, some move-ready and others littered with left-behind belongings.

Height measurements etched on the wall of one garage served as a personal reminder of those who lost their home.

"It's heartbreaking to see a house that was somebody's home, so I try to do it with some respect," said Sharon Harrington, who was on the tour looking for a home in which to retire with her husband.

White said the repo bus is a way to "bring affordability back to the market" and put properties back on the tax rolls by selling bank-owned homes in a low-pressure situation. But other area real estate agents question if efforts might be better spent helping homeowners avoid foreclosure in the first place.

"We sold these homes to these people and I would love to see more members of the Traverse City Area Association of Realtors finding proactive ways of working with homeowners on the brink of being in trouble," said Cindy Anderson, an agent with another local Coldwell Banker office. "My hope is to see more of that and less of the carcass feeding."

"The foreclosure bus is a gimmick and it's an ... effort to try to get inventory moving, but for me the image and the focus I would love to see in a more positive way," she said.

Haines said fewer homeowners are working to recover their property during the foreclosure redemption period than in previous years. Area officials believe that trend likely is associated with a shift to more lenient lending practices over the past decade.

"Ten years ago they required a 20 percent down payment, so you would have some kind of investment in the property. But with some of these 100 percent or 110 or 120 percent loans you have nothing invested ... so it would stand to reason that walking away from it would be a viable option," said Thomas Longanbach, Benzie County's equalization director.

Longanbach watched his county's foreclosures jump from 56 in 2006 to 89 in 2007.

"If I have 15 foreclosures and one is redeemed, it's surprising," said Haines, of Grand Traverse County. "Maybe a third of them were redeemed before."

Local RE/MAX agent Tim Reid, who has grown his business around listing foreclosed homes, said that while it's sad to see a repo bus making stops at $200,000 homes, "the foreclosures are there available for sale whether they are being shown to people on a bus or not."

Nancy and Greg Stuck, of Traverse City spent a Saturday checking out homes for their son, and like most on the bus, weren't overly concerned with how the houses got on the market.

"They don't own it, the bank owns it," Nancy said. "I don't feel like I am picking over bones. They have gone on with their lives."

The Associated Press contributed to this report.

Foreclosures in region

The number of properties listed in foreclosure by county.