Looking for Suggestions on Tax Deed Sales For Land

  • LIM Mod

    Hey guys, 

    I've been trying to wrap my head around tax deed sales (specifically for land) for the last couple of months but every time I run through the properties at an auction... the properties going to auction all kind of stink. 

    Do you guys recommend any advice, or suggested educators in the tax deed space, specifically for land? 

    I might reach out to them and try and get them on the podcast. 

  • LIM

    Jaren Barnes - I have attended a number of sales but bought only a few parcel at county Tax Deed sales (sometimes referred to as Sheriff's Sales).  Most of the time the properties are fairly useless.  If got the route of buying from a tax sale - you want to be sure you due your due diligence ahead of time.  You want to know what you are buying.  I went to a tax sale once and watched a guy buy a lake (more like a small pond) in a developed neighborhood.  The owner's association evidently had not paid the taxes on a 5+/- acre parcel that had the neighborhood lake / duck pond on it and the county (near me) sold it at the tax auction.  I had some small chat with him before the sale started - he was wanting to get into investing in tax deed properties, etc. but hadn't bought any thing yet.   He said it was his first tax sale he'd been to.  I had researched all the properties going to sale and knew it was a pond (Google Earth).  When the guy started bidding, he had a couple other guys in the room bidding as well.  I eased over to where he was standing him and tried to give him a heads up - but he waived me,said he was trying to pay attention the sale because he was bidding on a property.  So - I left him alone and he won the bid for about $4K.  I didn't have the heart to tell him afterwards -just minded my own business.  Hopefully he was able to sell it back to the HOA for what he paid + the 25%.

    In TX, if someone purchases the home, or land designated for Ag use, at a tax sale - there is a two year redemption period.  For other land it is 6 months. During this period the previous owner can get the property back by paying the person who bought it at tax sale amount paid at tax sale + 25% "interest" per year, with a minimum 25% of the amount due.   My research - now dated - indicated about 90% of houses sold at a tax sale get redeemed but less than 5% of land.

    Nonetheless - the caveat is you will likely need to hold any land bought for at least the redemption period (e.g. 6 months in TX) at least 6 months to ensure it isn't redeemed = before yo sell it.  Also - you generally can;t get title insurance on tax sales properties - at least not fro a while.  I've seen it said 2 years, other places heard 7 years - unless you spend $2 or $3k with a firm like Tax Title Services to get them to issue a certificate that some title companies will accept and write title insurance.

    One alternate strategy is to get the list of properties going to sale as soon as it is published and attempt to "snatch" the properties by buying them before the sale from the owner.  Then you don't have to mess with a redemption period or the "no title insurance" thing sine their is no sheriffs deed in the chain of title.  I posted something in the Club forum about 5 years go on this.  


    But - back to the topic of info on Tax Sales.  Dustin Hahn has a site, course, articles, blog, etc, here: http://taxsalessecrets.com/index.html

    And, here is a link from Dustin Hahn's Tax Sales Secrets blog site about the topic of deed grabbing:  http://taxsalessecrets.com/blog/2011/07/05/all-about-deed-grabbing/

    Here's a link I found in a ten-year Bigger Pockets thread to a site with link to Rick Dawson's "Land Grabber" course - appears to be discounted now from 1,697.00  to $147.00:  

    https://cheapiecourse.com/product/download-rick-dawson-land-grabber/

    Hope some of this helps.

  • Mod

    This post is deleted!
  • LIM Mod

    Karl James you're a gentlemen and a scholar sir! Thank you so much for your insight here - pure gold!

  • LIM

    Jaren Barnes

    Just wanted to bring this thread back up to the top of the list as I noticed Seth Williams posted a series of YouTube videos on tax deed auctions. 

    I was interested in heading down this path as it seemed like an acquisition process that cut out a lot of variables when dealing with direct mail. I consulted my real estate attorney and he cautioned me that these properties are the highest risk properties out there. Everyone looking to purchase this type of property is familiar with the redemption period that Karl James mentioned above and each state is different. However, the one thing my attorney brought up, which I've not come across in my own research, is that delinquent owners also have federal redemption protections. The federal language is not nearly as clear as the state statutes. According to my attorney, the language is a bit more general: within a reasonable amount of time. Which makes me think, "what's a reasonable amount of time if the delinquent owner never actually received communication from the Assessors Office because they had the wrong address on file?" From my own personal experience in direct mail campaigns, this is the case for about 10% of all vacant land owners.

    In an effort to keep this post short, I'm not an attorney, nor am I pretending to be one. If you're looking to get into purchasing tax delinquent property at auction (or post auction), I would consult a real estate attorney. There are federal protections that you need to be aware of as well as interstate land sales laws. I hope this helps!

  • LIM Mod

    Bryan Lauth I hear you!

    I think that's sound advice - after Seth and I really dived into it I think there is more opportunity in going direct to seller. 

    Unless you're comfortable doing business in undesirable counties, the competition seems to be pretty fierce, and even in those undesirable counties, the profit margins seem to be a lot smaller (though to be fair, you don't have direct mail costs). 

    Maybe it could work if you bought a bunch of properties in bulk or if you exclusive sold on terms. 

    Either way, personally I found it best just to keep going the direct mail route for now. 

  • LIM

    In case anyone wants to see my recent attempt at a tax deed auction and what I learned, be sure to catch the 4-part series I put together here:

  • LIM

    I will add my two cents here, I live in Ga. and I have bought and sold several tax properties here. And yes 90-95% of the properties are useless. Georgia is a 12 month redemption period with 20% interest and attorney fees if they redeem. It will cost you about $3500 in my state for an attorney to do a quiet title action to get clear title. Unless you can do it yourself, which I have no clue how to complete all of it. It will take about a year and half(in GA.) to complete the quite title process for tax deed. After the 12 months it will need to be advertised and notices served to complete the process. You will get a "Tax" deed in your name at time of sale in Georgia , other states your just buying a lien. There are some State/Counties that have counter sales where they will sell them free and clear by walking into the tax commission "counter" and paying the tax. 

        There are a few state that sell clear deed at time of sale, I believe SC is one. Again most are useless but you don't know until you look. The difficult part of tax sales is there is no central data base of properties and reaching out to every county and seeing what they have. If you look on www.GovDeals.com they will sometimes list tax properties posted directly by the county. Per my attorney, HOA or subdivision green space are not something to mess with. Also some of the green was probably used in the land planning for zoning the property high density subdivision. And if that green space is gone then I would think the subdivision would not be in compliance to its green space agreement, then you would probably have an issue with the county.  The challenge I find is figuring out what each states regulations are and what properties are available in each county. It seems to be the same as land you need to reach out to each individual county.   


  • Jaren,

    I know this post was back in July before I joined the blog. In 2015 I started my land buying career buying tax deed properties. I had found a program for $85 on tax sales and dove in. It left a lot of gaps but I filled them in as best as I can. I live in south Florida and bought a lot of properties in the Lehigh acres area. Lee county had tax deed sales online every Tuesday at 10:30am. I actually bought my fist two properties ever on my smart phone while returning from a doctors office(wife was driving). I probably bought about 10 of them over the next 6 months, always doubling my money. I was even selling them in Ebay. I then found a Land Investment program with the CEO through a conversation on Bigger Pockets where I had questions about tax deeds. 
    I joined that program and was a Silver Member, started doing mailers and moved away from tax deeds. Recently I decided to cut the cord with that membership because I wasn’t utilizing all the tools available for the price I was paying. With tax deeds in Fla the tax deed sales wipe out all liens(except county). I got burnt on one I bought in Brevard county. Paid $3900, sold fo $10,000, but found out a year later there were $8000 in code violations I didn’t realize.But the good thing is they cap it at 20% so I can still make some profit.  You also have the option to get a quiet title using resources like Clear to Sell. I heard but never confirmed that after two years of sale the title is clear. I usually just advised the buyer to contact the quiet title company and pay the fee. About a year ago I decided to get back and look at tax deed sales in Florida again. What I noticed was the tax deed sales, because online, have gotten out of control. Bidders are paying 3x assessed price fo parcels. I tried a few of them and gave up. Being online anyone can participate. I’m not sure if it’s an international influence that has caused an increase in the budding, but I decided it made more sense to send out mailers than pay more fo a lot then what it’s worth. 

  • LIM Mod

    Michel Steele said:

    option to get a quiet title using resources like Clear to Sell. I heard but never confirmed that after two years of sale the title is clear. I usually just advised the buyer to contact the quiet title company and pay the fee. About a year ago I decided to get back and look at tax deed sales in Florida again. What I noticed was the tax deed sales, because online, have g

     Thanks for the thorough reply! 

    I realized after doing a deep dive, the strategy is probably not for me. I think it could work with terms deals but what kills it (at least from what I can see) is getting a quiet title action on each property. 

    The cost of that really eats into the profit margin a lot of the time. 

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