An investor bought a house to flip. Escambia County tore it down a week later. Here's why

A real estate investor who bought a dilapidated home in Escambia County through a tax deed sale was “shocked” when she discovered the county had demolished the house a week after she bought it.

Ana Lopes purchased the home in Mayfair at a tax deed auction for $11,200, on behalf of Maison Investment LLC, a small real estate development company based in Texas.

She bought it on Dec. 5, 2023, and the house was torn down on Dec. 13. Despite researching county records on the property online, Lopes did not realize a county magistrate had ordered the run-down house be demolished months earlier.

“When I purchased this property at a tax deed auction there was a house there and less than one week later it was torn down by the county and I wasn’t notified,” Lopes told Escambia’s Board of County Commissioners at its meeting Tuesday.

“I found out there wasn’t a house there when my buyer, a flip company who was buying the house to flip it, went to visit the house to take pictures and inspect it and he arrived there and (there was) no house. I was shocked because I didn’t know it was being demolished,” Lopes said.

Escambia County Attorney Alison Rogers explained that the county code enforcement process was already underway when Maison Investment purchased the property, and that the previous owner was notified.

“It was properly noticed and through that process there was a magistrate’s order to do the demolition and that abatement was done by the county at county expense shortly after the acquisition by Maison LLC,” Rogers said.

As a result of the demolition, a lien of more than $17,000 was placed on the property at 1145 N. Webster Drive. Once the home sold, more than $4,000 in surplus money from the tax deed sale also went to pay code enforcement fines on a different property owned by the previous owner of the Webster Drive residence. Escambia County has a policy that surplusage from tax deed sales is applied first to the oldest liens.

Lopes asked the board to forgive the liens she was facing. Although the house had been damaged by fire and sat empty for years, she said she had already found a buyer who wanted it before the home was demolished.

“I’m not able to sell the lot,” Lopes explained. “I had people interested in buying the house, I was interested myself to do the renovation to flip the house if I didn’t find somebody to buy it, but I found one and now I have a lot and an expensive lien.”

Commissioners sympathized with her situation but pointed out there are disclaimers on the county’s website regarding tax deed sales and the magistrate’s order to demo the house, along with the status of the abatement, were available in county records if she had checked more thoroughly.

The commission agreed to apply the tax deed surplus funds to the demolition lien on the Webster Drive home but said Maison Investment was still responsible for the remainder of the demolition lien and court costs, which brought the total down to just under $13,000.

“It’s not necessarily a point for this issue but going forward there’s something at its heart I don’t like about that,” said Board Chairman Steven Barry. “That doesn’t seem fair. Notice was given to the previous person, and I know that we do everything the way we’re supposed to do it legally, I don’t dispute that at all. I’m sure there’s fine print that says 'buyer beware,' but I don’t know what measure of awareness it takes that a certain property is going to be demolished within a calendar week of your acquisition.”

Tim Day, Escambia County's senior natural resources manager, said this situation is extremely rare and that he will work with county staff on ways to help inform potential buyers of issues with properties.

“We're looking to continually improve the process and try to make sure that even if someone doesn't do all the due diligence, that we're trying to provide a safety net try to prevent this kind of economic harm,” Day said. “That's why there are so many ‘buyer beware’ disclaimers, because if you're not from here tax deeds have an inherent risk.”

In November, Escambia County demolished a house in Brownsville that had been purchased by an out-of-town corporation that bought the property through a tax deed sale. The property sat empty, and eventually squatters moved in permanently.

Out-of-town companies regularly buy properties through tax deed sale for investment and oftentimes it’s an improvement for neighborhoods.

“They're obviously very welcome because they bring in some outside funds and they help either rehabilitate homes or they may even demo and build new homes,” Day said generally of out-of-town investors. “The challenge comes when some of the companies buy these distressed properties and then they just hold them and they don't make improvements and so in some cases may even let it go back to tax deed in another couple years and that type of investor just kind of continues blight in the neighborhoods.”

This article originally appeared on Pensacola News Journal: Escambia County demolishes Mayfair home sold at tax deed auction