I ended the title of the subject line in a proposition, I don’t care. What I really want to know about is land tax sales. More specifically, Maryland or West Virginia. Does anyone here have experience buying property at a tax auction? Any tips? Any advice?
Sorry, I already found apicture of Boss Hogg’s Cadillac before I realized this was about real estate
Tricking someone to read your thread is bad form.
No, you didn’t, and it’s okay even if you did.
Huh? You don’t find the idea of investing in tax delinquent properties the least bit lecherous? One is profiting off of the misfortunes of others in a very direct way, and it’s sometimes referred to as “Vulture Investing”. Not to say I wouldn’t do it. There is also a benefit to society with this type of investment strategy - counties need the money to fund good things such as schools etc., I’ll focus on that aspect of the situation. HOW COULD YOU IMPUGN MY CHARACTER IN SUCH A WAY!!!
It’s not “misfortune” to not pay your property taxes.
The misfortune is that these auctions are rigged in such a way that the property sells for a fraction of it’s true value. That’s the crime. The original owner almost always would have paid their property tax if they knew - or sold it themselves at full market price and paid off the tax with the proceeds. But the government fails to inform the owner, or the owner is dead, or the owner has dementia and is unable to understand the notices.
The crime here is the way these auctions are conducted. If the county just commissioned a normal real estate agency it would have sold for market value.
Here in North central Indiana, during the great recession, folks did walk away from their homes because they could not pay the mortgage. In these parts the banks would often not take title, easier to post a loss than take care of the property. The real estate tax wouldn’t get paid and sooner or later the property would be delinquent and it would fall to the County to try to collect what they were owed through sales. At that point the County was only interested in recovering the amount due in back taxes, hence a low price.
Now as to buying a distressed property, you do not get to inspect the property before hand, so you have no idea of the interior condition. So, the property may be in such bad shape that you just wasted your money or you need to make a substantial investment in repairs.
The next point is what do you intend do with it, live in the house yourself, repair and sell ie “flip” or become a landlord?
Al three have their own special issues, all starting with the cost of needed repairs.
What I have seen is that houses that can be flipped for a profit don’t have significant repair issues. Significant repair issues, walk away.
Rental housing is only successful where you have good management and can financially weather having the house sit empty or needing repairs after a tenant leaves.
My experience here is from working in a municipal Building and Code Enforcement Department. The department only got involved in cases where the investor over leveraged and could’t make the mortgage payment(s).
This does not mean that folks did not succeed in real estate investment. None the less of the successful Landlords I knew of, all were very attentive to their property(ies) and did not wait when they felt that a tenant eviction was called for.
Zuer-coli
In the strict sense no; but there are more nuanced outcomes involved in this method of making a profit than, say, selling lollipops.
You have absolutely no idea what you are talking about or even how a tax sale works.
So educate me. As I understand it, these are auctions where the buyer has to pay the winning price in cash. Simple supply and demand economics means that since there are fewer buyers who can pay cash for a house, there’s less demand, and the clearing price is much lower.
Which part of this am I wrong about? I hear articles all the time of 100k+ houses selling for 5k at one of these rigged auctions.
I believe you ended it with an infinitive, which is an acceptable form.
This is seriously flat earth levels of ignorance in regards to this subject. Just read any of the numerous articles online about the subject and it should become apparent how misguided you are on the subject. It is not particularly complex.
https://www.auction.com/blog/buying-investment-real-estate-at-auction-the-basics/
Pretty much this article confirms everything I was saying. Including " In almost all cases, you’ll have to show that you’re in possession of sufficient funds to pay for the property in full." Flat earth, indeed. I’m going to charge that you are the one in denial of the facts.
Among other things, look at it this way. You’re excited to engage in this because you think you can make a lot of money. And it’s possible that you can. But what’s the economic model?
You buy a house at ? value.
You sell a house at market value.
It’s trivial to see that “?” must be less the market value - a lot less than market value - or you won’t make any money.
The other way to make money is you buy a distressed house at < market value, put in a bunch of labor to restore it to pristine condition, and then sell it at market value for a house in pristine condition. In that case, essentially the economy is paying you at about the trade rate for all the repairs you did, but you don’t have to be a licensed tradesman to get in on the business. Since plumbers and electricians and other tradesmen have competition restricting guilds, and charge $50-$100 an hour, this can work out well in your favor.
Unfortunately, the glory days of this are obviously long past. You can make a living buying and flipping houses - but if everyone else is doing it, it won’t be an amazing living. These days, due to all the media on the subject, I bet those auctions are crowded with other wanna-be flippers, and the bidding prices are closer to the real market value for the place.
Well, it’s okay so long as you understand that no means no.
The article you linked is about foreclosure auctions not tax lien sales. Please just stop.
You keep claiming you’re a know it all and I’m an ignoramus on this subject. Yet,
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You’re asking for advice
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You have yet to point out even 1 thing I’m wrong about, instead just calling me a flat earther with no basis whatsover.
Please stop posting if you’re going to be like that.
It’s nothing personal, it’s just that from your posting on this subject it is clear you have no understanding of the process involved in a tax lien sale. I’m not calling you a flat earther, but to me your posting on the subject is as off base as someone who would go on and on about how the earth is flat. Actually, its even a little worse, in this case all you would have to do is look up the applicable laws in regards to tax lien sales, none of which are particularly complex until you get into the intricacies of obtaining a quiet title. In other words, your notions of what a tax lien sale entails and also the nefarious intent you ascribe to people involved in the process is absurd to the point I don’t have any interest in discussing the matter along the lines you wish to discuss it - similar to how I would feel if someone insisted on an explanation of me about why I don’t think the earth is flat.
It’s nothing personal, sorry if I’ve hurt your feelings.
Where did I say nefarious intent? I said the outcome of such sales is that the homeowner gets screwed generally. I never once said that this was the plan from the start - it’s more than the government is indifferent to the homeowner’s plight, the government just wants it’s money. And a tax lien sale is an auction just like I said. Not really seeing what details I need to look up, every detail in every post I have given has so far been correct.
It’s only lecherous if you are leering at the young woman processing the paperwork for you.