Landbank Authority completes record-breaking year of vacant property sales
Mayor Greg Fischer today joined Metro employees and the Landbank Authority to celebrate the conclusion of a record-breaking year of efforts to return vacant properties in Louisville to productive use.
In the 2017-18 fiscal year, which ended June 30, the Louisville Metro Vacant & Public Property Administration (VPPA) closed on the sale of 125 vacant properties in FY18—a 330% increase from the previous fiscal year. In the 2016-17 fiscal year, 29 sales were made.
Metro officials attribute the increase in sales to new sales programs—Last Look, Cut It Keep It and Flex Rate policy—that were debuted in October 2017.
“This tremendous increase in the sale of vacant is the result of innovative ideas, a hard-working city staff and engaged community members,” Mayor Fischer said. “Vacant and abandoned properties are an immense burden to our city—they often become havens for crime and they reduce neighboring property values. Each sale represents a win for neighbors and for public safety.”
The Landbank Authority, which is staffed by VPPA, is a nearly 30-year-old board that represents a cooperative effort by the three main taxing entities—Louisville Metro Government, Jefferson County Public Schools and the Commonwealth of Kentucky—focused on returning vacant properties back to productive use.
A breakdown down of VPPA programs and sales made by each program are as follows:
- Last Look—Save The Structure (41 sales): Landbank Authority-owned vacant structures that are demolition candidates are available in this program. Before purchase, buyers must show proof of funds for the exterior renovation/stabilization and must make exterior repairs within in 6 months and interior repairs within 18 months of closing. Last Look saved the city about $400,000 in demolition costs in FY18.
- Side yard (28): This program is available for next door neighbors of a Landbank Authority-owned lot who want to expand their property.
- Cut It, Keep It (24): Property owners of an occupied home or building on the same block as a Landbank Authority-owned vacant lot can purchase that lot through this maintenance program. Resale restrictions apply, unless developed within the first three years.
- Request For Proposal (17): Some Landbank Authority-owned vacant structures available for sale are structurally sound and safe to walk through. These homes are offered through a bi-monthly Request For Proposal (RFP) process. VPPA staff offers two open house opportunities for each of these properties. Proof of funds for the renovations must be provided.
- Flex Rate (8): Buyers can use the flex rate policy to purchase a Landbank Authority-owned lot if they have detailed plans and an itemized budget but do not have proof of funds. Sale price is determined by a set price per square foot, PVA land value or appraised value, depending on the size of the lot.
- Budget Rate (6): Buyers can use the budget rate policy to purchase a Landbank Authority-owned vacant lot if they can provide detailed plans, proof of funds, an itemized budget and project timeline. Sale price ranges from $500 to $1,000 for lots under 10,000 square feet.
- Last Look—Demo For Deed (1): Landbank Authority-owned vacant structures that are demolition candidates are available in this program. If a buyer shows proof of funds that they can pay for demolition of the structure, they may purchase it without restrictions on the redevelopment or resale of the property. Approvals are still needed by the Offices of Planning & Design Services and Construction Review.
According to data collection as recent as March 2018, about 5,100 vacant properties (3,600 of which are structures) are in the city of Louisville. The Landbank Authority owns about 500 of those properties. The other 4,600 are in the hands of private property owners, sometimes deceased residents or dissolved LLCs. VPPA works with Code Enforcement to identify vacant & abandoned properties and then uses a variety of tools such as foreclosure to remove properties from their abandoned states so they can return to productive use for the neighborhood. VPPA also accepts property donations.
Louisville Metro Government has worked with the state legislature to pass five separate bills into law that streamlined the process so that we could more effectively move these abandoned properties through the foreclosure process and into new uses.