Think selling a house in this market is tough? Try unloading a lighthouse. Saddled with buildings, properties and land it can t use, the U.S. government is ready to deal which spells opportunity for buyers with a little imagination.

The General Services Administration, which manages, preserves and sells government buildings and properties, has fallen on hard times. The pool of buyers is smaller, and even for those eager to own a ranger s cabin or an army barracks, financing is tight particularly because many of these properties are obsolete and in need of renovation, which makes them risky in the eyes of lenders. So in response, the GSA has lowered the threshold for minimum bids in certain markets. That means the mid-sized lighthouse you ve always wanted could be yours for just $10,000 down.

But doing business with GSA, as with many government processes, can be a hassle for individual buyers. The agency requires a registration deposit before an interested buyer can bid, and those deposits can start at $10,000 per property and run to more than $1 million. (The money is returned if the bidder doesn t win.) Want to see the property before you bid? That might not be so easy either: Some of the properties are accessible only via U.S. Coast Guard ferry or if a registered bidder misses the tours, they can contact the GSA realty agent listed with the property. For one property currently on auction, the Old Orchard light station, three miles off the coast of Staten Island, N.Y., the GSA and U.S. Coast Guard, in seafaring weather, have ferried registered bidders to the property, says Ralph Conner, GSA s director of property utilization. There are usually two open houses scheduled for offshore properties before the auction begins, and about 70% of registered bidders for a listing will visit often with their own marine engineer who assesses the property s condition, he says.

And there are other hiccups. Unlike some federal government agencies, the GSA doesn t provide financing, which means that buyers who can t pay cash will need to arrange their own loans. In some cases, buyers are responsible for resolving environmental issues which the GSA discloses in the listing and bidders are screened to see whether they have the money for clean-ups that can run to $1 million or beyond. The GSA hasn t put Plum Island on the auction block yet, and when it does, buyers will learn that the 840-acre island off the north coast of Long Island was previously used by the Department of Agriculture as an animal testing facility. The government says it plans to clean up the island before selling, which means a new buyer might be oblivious to the years of controversy over health issues that swirled around the property. The new buyer would not have to deal with those issues, says Conner.

On less complicated purchases, buyers should know what changes they re permitted to make after they purchase the property. Converting a lighthouse into a home is a common request, though in most cases, the buyer will have to get approval from the state to live there. And while most federal and state regulations don t permit major changes to the lighthouses exteriors, buyers can generally do whatever they d like to the interior. The cost for making such a renovation varies; some lighthouses include living quarters and some have a separate dwelling. Remodeling the property, depending on how much work is needed, could cost upwards of $500,000, says Jeff Gales, executive director of the U.S. Lighthouse Society. That could be a fair price for a waterfront property.

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