Gerda & Bolivar Go 120 Rounds

Sonya Schoenberger PhotoAs a crowd looked on, two Fair Haven families competed to rescue a boarded-up two-story house on Blatchley Avenue.

“One hundred dollars!” Bolivar Leonardo Carchipulla-Nugra kept calling out over the course of two hours of bidding.

Gerda Genece would wait until the auctioneer declared, “Going once ... going twice ...”  then jump in with a triumphant “one dollar!”

The bidding took place at an unusual foreclosure auction Saturday at 409 Blatchley Ave. The house has been abandoned for at least five years, maybe longer. The windows and doors are boarded up; chunks of the aluminum roof and siding are missing. Squatters have stripped the interior of copper and everything else of value.

Despite the property’s blighted state, Gerda Genece and Carchipulla-Nugra were excited about the possibility of turning the property into a home.

Carchipulla-Nugra arrived at the Fair Haven auction with his wife Maria Velecela and their young daughter. They currently pay about $1,000 a month for rent —  too much, in his opinion. He hoped to buy the property so that he could fix it up and live there himself, with his family.

Genece was accompanied by her adult daughter, Gerray Mead. Mead, who is in her late 20s, was looking for a house for herself —  ideally a two-family home with a second floor she could rent out.

It was Genece who did the bidding, though. She embraced the role with exuberance.
 
The bidding began at noon, and the auction price started at $14,300.

About a dozen potential bidders and onlookers crowded around Jon Patrucco, the attorney appointed by the Superior Court to manage the auction. The City of New Haven initiated the foreclosure on the basis of $4,000 in unpaid taxes.

As the bids climbed above $19,000, everyone except Genece and Carchipulla-Nugra dropped out of contention. A pattern quickly emerged: Carchipulla-Nugra would up the bid by $100, and then Genece would outbid him — by one dollar.

“He’s Mr. $100. I’m Mrs. $1,” Genece joked after an hour of the back and forth, adding: “It’s a bit addictive.”

Upbeat Affair

Public auctions of foreclosed properties are rarely jubilant or extended affairs. Often they forcibly displace an owner who has fallen behind on taxes or utility payments, or tenants. The bidding process itself is generally goes quickly, sometimes in a matter of minutes.

Saturday’s auction was on Blatchley Avenue was different. The owner who abandoned the property did not appear, and the bidding went on for nearly two hours.

Bids climbed in tiny increments of $100 and $1 to just over $30,000. The process was punctuated with laughter and good-natured overtures. Carchipulla-Nugra appreciated Genece’s tenacity and, as the bidding extended through lunchtime, offered to buy Genece and Mead a nice Ecuadorian meal, regardless of the outcome.

Between bids, the audience discussed the interior condition of the home —  the vandalism, the feces on the wall —  and the costs associated with fixing it up. Anthony Ortiz, a contractor who grew up in the neighborhood, watched the process with interest. He said he hopes to bid on a foreclosed house himself in a few years and then use his contracting skills to fix it up. Pointing to the damaged roof and other points of concern on the exterior, he estimated the house at 409 Blatchley might need tens of thousands in repairs, including material and labor costs.

Safa, who declined to share his last name, was initially interested in buying the house to reap the benefits of Yale University’s employee homeowner program. He was skeptical of spending much more than $25,000 on the house, though, given the repairs required.

Genece and Carchipulla-Nugra, on the other hand, were undeterred by the work required to make the home livable.

It wasn’t Genece’s first auction. Twenty years back, as a recent immigrant from Haiti, she bought a house just around the corner through a private auction. It took a while to renovate that home, she said. A single mother of four kids, she fixed the place up “a little bit at a time” with her brother’s help.

Mead grew up in that house, and Genece found a supportive and tight-knit community on her new block. Genece felt at home among neighbors who let her keep a rooster and chickens in her yard, and who were committed to creating a safe community.

Carchipulla-Nugra immigrated from Ecuador 15 years ago. He lives with his wife and their five-year old daughter in Fair Haven, not too far from the house on Blatchley Avenue. He works a commercial printing factory job, and is keen to become a homeowner —  and perhaps a landlord to a second family who would live under the same roof.

Lunch Money

 
In the end, Carchipulla-Nugra placed the final bid— $33,505, up from Genece’s $33,405. For the first time in nearly two hours, Genece declined to up the bid by a dollar.

But she and Mead didn’t walk away empty handed. After clapping and handshakes, Velecela (pictured) rushed to give the pair money for lunch at a local restaurant, insisting over their polite refusals. She hugged both mother and daughter before joining her husband to finalize paperwork with Patrucco.

Patrucco, for his part, seemed to enjoy the conviviality and occasional theatrics of Saturday’s auction. He administers about two auctions per year on behalf of the City of New Haven, at the behest of the Superior Court. They’re “not usually this exciting,” he said with a smile. Often, he explained, nobody even shows up.

Safa, who is from Sudan, and who has bought properties in Sudan, Kenya, and London, offered advice to Genece and Mead. Carchipulla-Nugra conferred with friends and onlookers in Spanish. And Ortiz, who was born in Mexico, responded to requests from various parties for his contracting services. At one point, a passerby from the neighborhood swung by to offer to help clean up the interior for $10 an hour.

Genece knows how important community can be from her own experience as an immigrant and a single mother. Despite being outbid, she seemed cheered by the outcome —  a young family turning an abandoned and blighted property in her neighborhood into a home.

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posted by: Kevin McCarthy on September 13, 2018  4:39pm

Good luck to both families!

Interesting contrast between this disposition process and the one used by LCI.

posted by: Patricia Kane on September 13, 2018  6:54pm

At least court ordered sales are required to post a sign on the property so the neighbors and passersby are alerted.
There are no pre-sale inspections, as I recall, so there is risk in buying a property that could need all kinds of repairs.
Still, a lot of working class people know family and friends in the trades and can work something out.
Here’s hoping this investment works out.

posted by: robn on September 14, 2018  8:24am

I’ve never understood the no-pre-sale-inspection rule. The city is damned to get cautiously low bids in every case. Let them be inspected and a fair bid will be had for all.

posted by: westville man on September 14, 2018  9:42am

Robn-  In a word, liability.  Putting aside the problem of someone living in the premises, there are a multitude of things that could happen to people inspecting it. Putting it through an insurance claim can be very tedious and if denied, results in a court case. It is simply not worth it.

posted by: 1644 on September 14, 2018  10:43am

My experience has been that a walk-through is allowed immediately prior to the auction.  I suppose a bidder could bring a certified inspector or builder with them in this walk-through, but most don’t.  It’s important to have a keen eye for problems like rotting sills.  This practice may have changed, but the reference to feces on the walls indicates to me these that buyers were allowed in.  Insurance companies will require a full inspection report prior to issuing a policy, and buyers often have to remedy unknown things to get insurance.  A couple of things I remember were tree removal, covering electrical boxes, and grounding Bi-mex wired electrical outlets.  The biggest barrier for most buyers is the financing.  You have to have a large bank check in hand at the auction (20% of the starting price, I think), and no lender will issue a regular mortgage loan absent a insurance and on an uninhabitable property.  Ideally, one would get financing through a home equity loan on another property, otherwise it’s a high interest construction or personal loan.  The time frame to get the full price to the court committee (attorney) is pretty short, something like 2-4 weeks, maybe less, I think, so one needs a lot of ready capital.

posted by: robn on September 14, 2018  12:25pm

WVM,

One would think that the potential liability issue could be cured by getting indemnification from any potential buyer/inspector wanting to enter the property. No?

posted by: JCFremont on September 14, 2018  12:32pm

OK With these houses be renovated under LCI, State and City codes or will this be another feel good story until the renovations are completed disregarding any housing or zoning codes? Perhaps they will be done in a way more in the “style” of Ecuador or the Sudan? Call me skeptical but I won’t be surprised if corners are cut and in a few years and will see stories of the heavy handed LCI versus the struggling dreamers.

posted by: robn on September 14, 2018  2:05pm

JCF,

The building department and the building code can be a great asset to these buyers and insure a safe building. If the buyers reach out early, they may find the process more complex than they thought, but who doesn’t have that feeling after starting a renovation project, whether or not the building dept is involve?

posted by: 1644 on September 14, 2018  5:20pm

JCF:  Owners can do work on their own residence.  If they intend to rent it out, it most of the work must be done by licensed professionals.  Most of of it needs proper building permits, which will cost a little but be with far more in the advice the owner gets from the building inspectors.  It sounds like the buyer is intending to rent out some of it, which means a lot of things like the electrical and plumbing will need to be done by licensed professionals.  Overall, I think he will find $1000/mo for rent is cheap compared to the costs of homeownership (taxes, rent, insurance, maintenance, and likely loan payments.)

posted by: westville man on September 17, 2018  8:58am

I am assuming this was auctioned off pursuant to court order. Robn,  the law generally does not allow waiving one’s negligence. And requesting folks to bid, and then having them to enter a building fraught with potentially dangerous situations is not a risk worth taking. Anyone buying their first home should never consider bidding on one of these properties. The hidden expenses can be substantial.

posted by: 1644 on September 17, 2018  11:58am

FYI, all: I checked some current foreclosure notices on the judicial website.  They still have inspection periods just prior to the auction.  A typical one might be inspection at 10 am, followed by auction at noon.  So, liability concerns notwithstanding, one does get a chance to see inside.

    The typical pattern, though, is that the lender bids the full amount of what it is owed, which is often far more than the property is worth.  The bank will then market the property through a real estate agent, often taking a large loss after holding out for too much early one.  In most potential tax foreclosures, junior lien holders, such as first mortgagees will often pay the taxes so their interests are not foreclosed. When banks sell, the property is usually “as is”, with no inspection or financing contingency, and very quick closing dates with steep penalties for any delay.

posted by: westville man on September 17, 2018  12:12pm

1644-  The overwhelming majority of court ordered foreclosure sales do not allow for interior inspections. Most bidders show up with 15 minutes to spare.
The lenders usually bid approximately 75% of the appraised value to protect themselves in the event of a bankruptcy filing. Oftentimes they bid Friday by fax so other bidders will know ahead of the sale if it’s worth it for them to attend.

posted by: westville man on September 17, 2018  12:41pm

Correction to my last post: the court order allows for inspection, but in most cases that doesn’t happen due access issues.