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Q&A: what’s going on now with the boarded-up home on Old Auburn?

Old Auburn Road, Citrus Heights, abandoned home
A boarded-up home at 7716 Old Auburn Road now sits with a real estate sign in front of it, after it was removed from public auction. // CH Sentinel

Sentinel staff report–
In the latest confusing turn of events, the boarded-up home at the corner of Old Auburn Road and Mariposa Avenue has been removed from an upcoming public auction and is now listed for sale at $400,000 by the Sacramento County Conservator’s office, leaving chances that the City of Citrus Heights will acquire the property doubtful at best.

So, why the latest change in plans with the sale of the property?

A spokesperson for the County Conservator’s office could not be reached for comment, so we asked the City of Citrus Heights and a broker associate involved in the sale about the status of the property. Confusion appears to have been caused by a breakdown in communication between two different departments in the county who were both involved in the sale of the property, yet were each proceeding with different processes for doing so.

The county’s department of finance was seeking to sell the property through a tax sale auction to recover more than five years of back-taxes owed, while the conservator’s office was seeking to sell the home through probate, which is a court-supervised process of administering a deceased person’s estate.

“The county took it off of auction for nonpayment of taxes because it’s an estate in probate,” said Ken Dick, a broker associate with Keller Williams who is representing the conservator’s office in selling the home. He said the property will now be sold on Feb. 26 through a bidding process as part of probate.

Laura Jacobson, tax and license manager for the county’s department of finance, confirmed on Thursday that the property had been taken off a February tax sale auction due to probate being opened after heirs were located — although her department had previously told The Sentinel as late as mid-January that no heirs had been found. She said if a sale is not completed before May through the probate process, the property will again be slated for a “Chapter 8” tax sale auction in May to recover back-taxes owed.

See prior story: City considering purchase of run-down property at Mariposa/Old Auburn

Rhonda Sherman, community services director with the City of Citrus Heights, said on Friday that the city had been moving forward with interest in potentially purchasing the property for $22,300 based on information from Sacramento County’s finance department, “with the understanding that there were no heirs and that the Chapter 8 sale was how the county was proceeding.” She said the city now believes information from the county’s finance department “may not be correct.”

“We saw the (real estate) sign go up probably when everyone else did, so we tried to get to the bottom of it and we’re monitoring it,” said Sherman. “If there are heirs, then it’s their right to have the property.”

Discussion about the future of the property began last year after the home’s sole resident, James Wheeler, passed away inside the home and the property was boarded up. Believing that no heirs had been found, the city had expressed interest in buying the property last month for public use in order to remove blight and to facilitate future improvements along Old Auburn Road, which could include widening the roadway.

The listing
A real estate listing describes the 2.74-acre property at 7716 Old Auburn Road as a “very unique” parcel with potential for residential development, or possible zoning change to allow a church, school or other business. It also states it is unknown whether public utilities are connected to the home.

The listing says the home was constructed in 1940, with a 1368-square-feet floor plan that includes three bedrooms and one bathroom. Due to the hazardous condition of the run-down home, not much else is known about the inside — and potential buyers are not allowed in the home.

“I think that we have active mold in the house, and for health reasons no one is allowed in the property,” said Dick, noting water damage from leaks in the roof. “If you take a look at the roof, it’s pretty apparent that the roof is not in good condition.”

Dick said he’s received a lot of phone calls about the property since posting his red and white real estate sign in front of the dilapidated home last week. He said interests have varied in the property and noted that the city may allow the property to be re-zoned to allow other uses than residential, given the close proximity of churches and schools along Old Auburn Road.

He said the list price of $400,000 was determined using comparable acreage in a 3-5 mile radius, extending into part Sacramento County and Roseville. He said the property is rare to find in built out areas, so an extended radius was used.

“Basically what we’re saying is that the condition of house is questionable and that the real value is in the land,” the broker associate said, noting that the property is zoned to allow a minimum lot size of 20,000 square feet. “You’ve got at least five-plus lots depending on what the county and city would [approve].”

How the probate sale works
“The county will take the highest offer,” said Dick, noting that in the probate process there is also court confirmation required before the sale can be finalized. He also said there will be an “overbid opportunity” in court, which would play out essentially like an open-auction in the courtroom if someone decides to bid at least 5% more than the highest offer.

Another difference in a probate sale compared to a typical real estate transaction is that written signed offers must be accompanied by a cashier’s check in the amount of 10% of the total offer and have no conditions of contingency, Dick said. The highest offer is then submitted to the county and the rest are returned along with the checks.

Additionally, the broker associate said the county will not consider bids below 90% of the list price. “It’s listed for $400k and the lowest offer they’ll accept is $360k,” said Dick.

Typically the process of reviewing the offers is conducted at the county offices, but Dick said the Conservator’s Office has decided to expedite the process for the sale of the home in order to have the sale finalized before the Assessor’s Office can put it back on auction in May. As such, he said offers will be reviewed at the Keller Williams Real Estate office at 548 Gibson Dr., Suite 200, on Feb. 26 at 5 p.m.

The highest offer will then be sent to the probate court where a future date for final confirmation and an opportunity for overbidding will set, likely in March.

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