Probably because of beauracracy and paperwork. The 'random person' both knew how and was willing to deal with the hassle of the city's tax auction. The owner pr

Probably because of beauracracy and paperwork. The 'random person' both knew how and was willing to deal with the hassle of the city's tax auction. The owner probably didn't know they could, didn't know how, was unwilling, or otherwise unable. Arbitrage works :-)