Building a home versus buying?

[newbury]

Go to a tax Lein sale in your area. I'm not kidding when I say I saw homes sell for under 10K.

Many acres of land sold for a few hundred an acre...AND IN CA.

Do your sue diligence and you can buy some great stuff. DO a search on the internet. I never believed it till I went.

No need to say here what I purchase but know this, I'm heading back on the next sale and looking at other states as I type.

I have to agree with that!

Some states have "wierd" (to me) real estate laws. In Mississippi if a party doesn't pay the taxes they "sell" the land for the value of taxes due. However, then the original (and only them) party has like 3 or 5 years to "buy" the land back by paying all taxes due at the time.

This happened to me twice.
Years ago SWMBO missed paying on a parcel we owned, I panicked, we had lost about 20 acres. But then she bought it back without penalty the next year.

Then last year, my uncle-in-law had inherited like 80 acres of land. He owns A LOT of separate parcels of land. The county sends out separate tax bills for each piece of land based on township/range. For example I've 4 parcels of land (< 200 acres total) that cross T/R boundaries and I get 7 SEPARATE tax bills for them. Well apparently my UIL missed that he DIDN'T get a bill for that 80 acre parcel for several years. The County had been sending the bill in the mail to a vacant house where the deceased aunt had lived. It came to our notice, we went to the courthouse, paid the bill, "owned" the land.

Now if we had not told the UIL and he didn't discover his mistake within the limited time period he would of lost the land. We sold it back to him over dinner.

I don't know though, 80 acres of land for about $400 sounded good to me, but SWMBO didn't agree, besides the UIL lent me a tractor

 

[Obed]

Go to a tax Lein sale in your area. I'm not kidding when I say I saw homes sell for under 10K.

Many acres of land sold for a few hundred an acre...AND IN CA.

Do your sue diligence and you can buy some great stuff. DO a search on the internet. I never believed it till I went.

No need to say here what I purchase but know this, I'm heading back on the next sale and looking at other states as I type.

I think you've been watching too much midnight cable.

The proof is in the pudding. How many properties have you personally bought at a tax auction for which you ended up with a clean title that couldn't be redeemed later by the previous owner? I have never known anybody who has done that. NOBODY. Yes, I've seen the claims on infomercials but have never known anybody who has done this. If there were something to it, with all the real estate interactions I've had, I would think I would have run into someone.

Making money off the tax interest is where the real opportunity resides, but only in certain localities.

While it is theoretically possible to get a deal at a tax auction, it's like looking for a needle in a haystack. Read newbury's post. Every state I've heard of has a right of redemption period which means for x months or years after the tax sale, the previous owner can buy the property back for back taxes owed plus interest. The interest gets eventually paid to the tax auction's high bidder. In some states/counties, the interest rate is enough to make it worth while buying the tax lein at the auction and receiving the interest when the owner redeems the property. However, at some areas, the interest is not very much and may not be worth the hassle. I listened to one guy many years ago say that he always was late paying his property taxes because the late interest was less than the bank loan interest at the time.

In reality, somebody has to really be not taking care of business to permanently lose a property of value to a tax sale. Why would somebody let a $100K property go to tax auction for $5K? Well, somebody who owes $120K on a $100K property might do so but the bank would buy the property instead.

 

[newbury]

<snip>
In reality, somebody has to really be not taking care of business to permanently lose a property of value to a tax sale. Why would somebody let a $100K property go to tax auction for $5K? Well, somebody who owes $120K on a $100K property might do so but the bank would buy the property instead.

But unfortunately there are people "not taking care of business".
My 80yr old uncle-in-law had not been paying close attention, none of the family (it seems) reads the tax sales in the paper, and probably it would have gone missed for two more years, and whoever had payed the taxes on it (us) would have owned the land. In this case I think it was the counties "fault" sending the notice to the wrong address. He's a prominent dentist and fairly well known.

I'm not saying it happens a lot but I plan on throwing some money at it in the future.

 

[dmccarty]

But unfortunately there are people "not taking care of business".
My 80yr old uncle-in-law had not been paying close attention, none of the family (it seems) reads the tax sales in the paper, and probably it would have gone missed for two more years, and whoever had payed the taxes on it (us) would have owned the land. In this case I think it was the counties "fault" sending the notice to the wrong address. He's a prominent dentist and fairly well known.

I'm not saying it happens a lot but I plan on throwing some money at it in the future.

Last week our county paper published the list of people who did not pay their tax bills. Quite a few of them were small amounts. One of the big county developers did not pay his taxes on quite a few parcels. The town Mayor, a lying, dishonest, tax cheat, is smart enough to pay is property taxes because people will easily see that he likes to spend other people money but not pay his property taxes. Instead he does not pay his Federal Taxes and owes about $100K.

It seemed that some of the bills people just missed paying while others it was more interesting.

I know a family who lost 1,000 acres because the grand mother could not pay property taxes. That land is at a major intersection in Raleigh and the land is worth millions today. I never knew the details but you would think someone in the family would have found the tax money but they simply may not have had the cash. Certainly the tax value and thus tax due could have gone up to a point that they simply could not pay.

Later,
Dan

 

[Oaktree]

Some states have "wierd" (to me) real estate laws. In Mississippi if a party doesn't pay the taxes they "sell" the land for the value of taxes due. However, then the original (and only them) party has like 3 or 5 years to "buy" the land back by paying all taxes due at the time.

This happened to me twice.
Years ago SWMBO missed paying on a parcel we owned, I panicked, we had lost about 20 acres. But then she bought it back without penalty the next year.

That is weird. Who "owns" the land in the interim? Can you "buy it back" at any time or are there only specific time windows? What happens after the grace period...can anyone buy it for back taxes?

For some reason they don't value "outbuildings" very highly.

"Extra" acreage isn't always valued highly either. My previous property was in what over the years became suburbia (though semi-rural when I bought it in the 70s). It was on approx. 6 acres, most of which was woods. When I sold it, I was told by several realtors that the extra acreage added only minimal value to what I'd be able to get with only the minimum (2 acre) lot. Still glad I had it.