MEMA cottage auction too pricey for many bidders - WLOX.com - The News for South Mississippi

MEMA cottage auction too pricey for many bidders

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PERKINSTON, MS (WLOX) -

By Danielle Thomas – bio | email

STONE COUNTY, MS (WLOX) - Hundreds of MEMA cottages went on the auction block in Stone County Friday. Many of the people looking for bargain basement deals instead found cottage prices that they thought were through the roof.

MEMA officials say at a previous cottage auction the average winning bid was around $8,000  for a one bedroom. However, this time around it was a very different story.

Chance Hicks and his father drove from Laurel to McHenry hoping to buy a cottage. 

"They look pretty nice," said Hicks. "They're going for a little more than I thought they would."

The going prices for the one, two and thee bedroom cottages surprised MEMA officials too.

"We had hoped that we would bring at least $8,000 to $12,000 per unit. So far no unit has gone below $11,000, and we've had a couple of units that have gone over $20,000," MEMA Director Mike Womack said.

Hundreds of people from as far away as Texas arrived in Stone County for the auction. By midday, a handful of bidders had the others seeing red.

"Evidently there's rich people and people with deep pockets," said Ray Heitzmann of Bay St. Louis. "Maybe four or five people are buying most of them for exorbitant amounts of money, which eliminates somebody like me from buying one."

Paula Smith said she came from Alabama hoping to buy a cottage she could put on her property for her aging parents.

"It's been the pits. It's been ridiculous," Smith said. "You were led to believe because of the prior auctions that they would have at least have been at a reasonable price, but they're not. You've got people that are coming in here buying 13, 14, 16 at a time because they have an endless amount of money to work with. And you have these poor people who are looking for just a place to live.

Some people said they were hesitant to pay those kinds of prices when they know they'll also face hauling, repairs, taxes, and other expenses.

"Wild Bill" Smith of Monticello said, "It's going to take $7,000 to $8,000 to $10,000 to restore it back to what it was once you get one of them."

MEMA officials say while they understand the frustration, the agency must follow the law.

"I would really like for everyone who needs a home to be able to purchase one," said Womack. "But we are bound by state law to have an open auction and we cannot exclude someone because they're a dealer or because they happen to be a little more wealthy than another one."

Heitzmann said he understands auctions are for the highest bidder, but he feels more could have been done to help people with more moderate incomes.  

"Mike Womack and MEMA could have done something to restrict any one individual from buying no more than two and that would have given the average person, the non-millionaire, the chance to buy one of these that has a distinct need for one," Heitzmann said.

Womack said he's not sure MEMA can legally restrict the number of cottages someone can buy.

"If there's a follow up auction, if in fact that is something we can do, we will certainly consider it," Womack said. "Again I don't think that we're allowed to do that. That would be restricting someone's right to bid on public property."

By the way, MEMA estimates Friday's auction brought in $5.3 million. The first cottage auction brought in $2.8 million.

Officials say the money pays cottage installation for Katrina victims buying them for permanent housing and for other low income housing programs as stipulated by FEMA. MEMA is working with the Mississippi Development Authority and some non-profits to put those funds to use.

Copyright 2011 WLOX. All rights reserved.

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