TAX DEED STRATEGIES
Once you have decided to invest in Tax Deeds you will have to make some decisions. Here are some things you will need to consider.
What Are Your Objectives
Your first decision is to decide what your primary financial objectives are as you begin to invest in tax deeds. This decision will affect the areas in which you choose to invest, the type of properties you purchase, the method you use to purchase properties, and the time and work that will be required. Are you buying tax deeds in order to own and hold property or to sell and profit from property. If your objective is to buy and hold properties it will of course require much more capital to support your program. If you want to buy and sell it will require much more time and usually work to quickly remodel, and turn the properties.
Selecting an Area
Determining an area to invest in is especially important when you are purchasing tax deeds. You need to become familiar with local real estate values, consider undesirable areas, developmental trends, city plans and growth potential. Next consider if it is best for you to choose the state you live in or at least a state in the region in which you live. You cannot become an expert in every state or even every county in a single state. Laws may very in every state and sometime every county. In addition, within each county some areas are usually more desirable for investments than others. In most cases less populated counties usually have less competition for quality tax deeds.
What type of Properties
What type of properties, do want to purchase at the deed sale? Tax deeds are
available on raw land, commercial property, industrial properties, single family homes, developed lots, multi-family residences, even agricultural land. Residential properties and developed lots have the least investment risk and are usually a good choice for beginning investors. If you own your home, you will have some idea as to the value of property in the area in which you live. Real Estate agents are usually glad to help you understand values in other areas. Raw land can sit vacant for years and may not have water, sewer or roads yet available. Commercial and industrial property will always require more up front capital and can have environmental problems. If you have experience in commercial real estate it can be very profitable. But you must do your homework.
Next Post: TAX DEED STRATEGIES (Part 2)