Downtown Victoria property auctioned for half million

City winning bidder for Pandora Street building, takes possession of a defaulted property from 2011 auction

This building at 769 Pandora Ave. was bought by the city during its own tax sale auction.

This building at 769 Pandora Ave. was bought by the city during its own tax sale auction.

Sixteen people gather at city hall at 10 a.m. on the last Monday of September.

It’s on this date every year that the city auctions off properties with long outstanding property taxes. Most people in the room are just here to watch. But Edward Cheung has come in hopes of purchasing the one property still up for auction – a commercial building at 769 Pandora Ave. – though he doesn’t want to discuss his reasons.

The bidding starts at $55,200, an upset price that essentially equals the taxes, interest and penalties owing on the property.

Cheung is the first to bid, but he is promptly outdone by a city representative, who offers just $1 more.

The bids volley back and forth 36 times, following the same pattern, until the city’s bid of $500,001 seals the deal.

But that’s not the end of the story.

The building’s owner still has one year to pay the tax owing, plus interest, to redeem the property. Case in point: on the morning of the auction, two delinquent property owners rushed in to pay their overdue bills.

Municipalities across the province are empowered to hold these auctions as a means to recoup overdue taxes.

On the surface, the sales are a deal-hunter’s dream come true. But the likelihood of actually taking possession of a property at a fraction of its value is slim, since most are redeemed within the year.

Nevertheless, the purchaser at the auction still stands to profit, said city spokesperson Katie Josephson.

“Since the interest paid is higher than conventional investments, tax sales have created a lucrative short-term cash investment opportunity for some individuals,” she explained.

For 2012, the interest rate is set at six per cent, paid to the successful bidder on the full amount of their investment.

“We’re in a low-rate environment, so that’s huge,” said city finance manager, Chris Paine.

For the past few years, the city has purchased the majority of the auctioned properties. “The city has some ability to make it easier for (the previous owner) to redeem the property,” Paine said. “That’s what we want.”

Since 2009, six properties have been auctioned. All but one have been purchased by the city, and all but one of the properties were redeemed by their owners.

City new owner of auctioned property

For the first time in 12 years, a delinquent property owner has failed to meet the final deadline to pay overdue municipal taxes.

In September 2011, an empty lot at 1012 Yates St. went for auction after its owner failed to pay property taxes for more than two years.

“The previous owners didn’t feel it was worth redeeming,” Paine said.

Nobody bid on the problematic property, which is subject to a provincial order to remediate soil contamination. That makes the city the default purchaser, at a cost of $62,000.

On Sept. 26, the city officially took possession of the property, which once housed a dry-cleaning business.

rholmen@vicnews.com

Did you know?

• Properties are subject to tax sale that have outstanding property taxes from two years prior to the current year

• The starting bid at a tax-sale auction is the sum of all the property taxes outstanding, penalties and interest and a fine of five per cent of that amount, plus applicable Land Title Act fees.

Just Posted

Kay Gallivan paints a mural on the east wall of North Park’s Tiny Home Village (Kiernan Green / Victoria News Staff)
North Park Tiny Home Village opens at Royal Athletic Park lot to 30 unhoused

Residents will settle into new private units and the North Park community over the weekend

Carey Newman resigned from the Greater Victoria School District’s Indigenous Ad Hoc Committee May 13, citing ‘a pattern of systemic racism.’ (Black Press Media file photo)
‘Pattern of systemic racism’: SD61 Indigenous committee member resigns, calls for change

More than 350 people had added their names in support by midday Friday

The woman also received distracted driving tickets in 2018 and 2019. (Black Press File Photo)
Oak Bay driver gets third distracted driving ticket in four years

Officer caught the woman using her phone while at the wheel

Daily confirmed COVID-19 cases reported to B.C. public health, seven-day rolling average in white, to May 12, 2021. (B.C. Centre for Disease Control)
B.C. preparing ‘Restart 2.0’ from COVID-19 as June approaches

Daily infections fall below 500 Friday, down to 387 in hospital

Anyone with information on any of these individuals is asked to call 1-800-222-TIPS (8477) or visit the website victoriacrimestoppers.ca for more information.
Greater Victoria Crime Stoppers wanted list for the week of May 11

Greater Victoria Crime Stoppers is seeking the public’s help in locating the… Continue reading

Sinikka Gay Elliott was reported missing on Salt Spring Island on Wednesday, May 12. (Courtesty Salt Spring RCMP)
MISSING: Salt Spring RCMP find woman’s car, still seek Island resident

Sinikka Gay Elliott is 5’3” with a slim build and dark brown short hair

A Saanich man received almost 10 years in Supreme Court in Courtenay for a shooting incident from 2018. Record file photo
Shooting incident on Island nets almost 10-year sentence

Saanich man was arrested without incident north of Courtenay in 2018

Bradley Priestap in an undated photo provided to the media some time in 2012 by the London Police Service.
Serial sex-offender acquitted of duct tape possession in B.C. provincial court

Ontario sex offender on long-term supervision order was found with one of many ‘rape kit’ items

Rich Coleman, who was responsible for the gaming file off and on from 2001 to 2013, was recalled after his initial testimony to the Cullen Commission last month. (Screenshot)
Coleman questioned over $460K transaction at River Rock during B.C. casinos inquiry

The longtime former Langley MLA was asked about 2011 interview on BC Almanac program

Steven Shearer, <em>Untitled. </em>(Dennis Ha/Courtesy of Steven Shearer)
Vancouver photographer’s billboards taken down after complaints about being ‘disturbing’

‘Context is everything’ when it comes to understanding these images, says visual art professor Catherine Heard

Most Read