Condominiums are set to go cheap at Sun Peaks Monday — in one instance for as little as $900.
But the chances of a savvy skier scoring a unit on the mountain for the price of Apple’s latest smartphone is remote, say municipal officials.
This year marks the first time the Resort Municipality of Sun Peaks will have a municipal tax sale, a way for municipalities to collect property taxes owing for three years.
Earlier this week, 10 properties were slated to come up for auction. By late Friday afternoon the list dwindled to three.
“It’s the first time around,” said Mayor Al Raine. “We had a long list. Now we’re down to almost nothing.”
Bidders who show up on the mountain Monday must be willing to pay a minimum upset price — comprised of outstanding municipal taxes and other fees. That price ranged from $900 to $1,600 on the three properties.
While it may appear enticing to scoop up a room on the mountain for a few thousand dollars, municipal finance officer Nicky Braithwaite warned prospective bidders to do their homework, including checking on assessed value.
“We strongly recommend anyone interested do their research: check out liens, do your due diligence.”
Buyers must pay the listed upset price immediately after the auction and come up with their full bid price by the end of the day.
Property owners in arrears have one year to come up with all taxes and other fees owing. If not, the title is transferred to Monday’s successful bidder.
Units available are hotel rooms in Hearthstone Lodge and Heffley Inn, Raine said.
“They’re very small properties,” said the mayor. “It was part of an investment package.”
Braithwaite said while tax sales happen on a yearly basis in municipalities, the difference at a mountain resort municipality is many owners are foreigners. That can make communication about debts owing difficult.
She contacted Whistler, B.C.’s first mountain resort municipality, to get a better idea about how often bidders actually wind up with a property in the long run. Representatives said it almost never occurs.
“There’s no windfall profit, with the odd exception,” Raine said. “The owner still has one year to redeem,” meaning pay the owed taxes to retain ownership.
“If your property is worth $100,000 and it went for $20,000 (at auction), anyone in their right mind would redeem it.”
While the chance to pick up a property for cheap is slim, the tax sale offers an enticing return for those who put down cash on a property that is eventually reclaimed by the owners. Under the Local Government Act, the interest rate on the bid price provides a six per cent return.
“It’s an excellent return,” Braithwaite said.