Do you want the good news or the bad news - Hamilton Township

[Dave2]

1) The opening act.

Formula for a popular tax sale party:

Nice sunny winter day with good driving on the day that Toronto real estate market is officially declared in a bubble.  

bid opening site one hour from Toronto and 5 minutes from 401.  

Offer a large piece of property for sale with minimum bid 1% (yes one percent) of the market price the last time it changed hands
25 years ago (sell price $3,600,000 for property in 1990 with minimum tax sale bid price of $41,000)

Boundary of property is 200 yards from a municipal water supply on a main paved road (remember 170 acres is a big site)
and also 5 minutes from the 401. From Union Station 10 minutes by car to train station and 1 hour commute by train to Union Station which allows you to work on your computer in a civilized way (none of the go station cattlecar).  

Last development plans for site even featured this guys   new helipad.  To put it mildly this was an attractive tax sale.

For yours truly site is long walking distance from my home so of course I put in a serious bid.  

I also prepared something else that I have never done for a tax sale bid opening.  EVER  

The big question locally was whether we would see Toronto prices or not.  To put it in historical terms would we face the tax sale equivalent of the St. Valentines day massacre.  

2) The Party.

To put it mildly the place was packed including with some regular local party types who attend these types of gatherings who know each other by sight.  (I didn't see mountainman though wondering where he was ?)

Early on it by the fourth bid opening it became apparent to us locals that Toronto prices are starting to extend out well beyond from Toronto, so old local pricing norms did not apply.   As a result locals including yours truly didn't just get slaughtered, we were obliterated.    

3) The bids:  

Winning bid $370,000 2nd $310,000 with total of 4 over $300,000.  Total number of bids so large I didn't bother to keep track.  

At little over $2,000 an acre this is not necessarily a bad price,  it is just that it is well above historical norms for the area.  Obviously the times are a changing and maybe a year from now I will kick myself for being so stupid.  

By old standards my bid was right where it should be according to the retired chief building official for the township who also owns a dozen adjacent parcels of land to the tax sale property.  These old standards obviously no longer apply and we are in a brave new world.   Bidding levels were at local retail level or above which I expect to change once word of this gets out.  

4) The aftermath.  

Having just been squished like a bug one would have thought I would be sitting quietly in a corner with my dunce cap on.

No that is why I had a plan B and spent this party working busy as heck preparing for my next party that may start later today.    It may not last long but as they say we live in interesting times.  

Based on these tax sale prices the market is prepared to pay retail market prices. Didn't hope for this but so be it so be it.  
It just happens that I have won a few tax sales in the past and I do have an inventory of land currently for sale at prices below these tax sale prices.  

After the meeting was over I spent time informing some of the Toronto based losing bidders of that fact.  

I mean the winning tax sale bidder maybe still celebrating how he stole a bid from the stupid country locals including yours truly.  

[Jayz]

1) The opening act.

Formula for a popular tax sale party:

Nice sunny winter day with good driving on the day that Toronto real estate market is officially declared in a bubble.  

bid opening site one hour from Toronto and 5 minutes from 401.  

offer a large piece of property for sale with minimum bid 1% (yes one percent) of the market price the last time it changed hands
25 years ago (sell price $3,600,000 for property in 1990 with minimum tax sale bid price of $41,000)

......

I get it the bad news is that you lost your 50k bid to a $370k. What's the good news? you have similar lots to sell under?
 
What's with the 3.6m deal almost 30 years ago? Money laundering? Assume some 15 small lots along the road in front of the subject lot were later severed off the lot and sold for profit, numbers are still way off. It makes sense the original owner's name looked Chinese and the guy who "paid" millions of dollars for the lot and then abandoned it lived and may still live on Forst Hill.  

[Jack]

Dave's post is probably the the best that I have seen in a long time. Bravo! The information is timely, informative, and actionable. We should all be so forthcoming with tax sale results. Yes, the property along with other lands sold for $3,600,000 but what was not mentioned was the fact that on the same day mortgages totalling $4,200,000 were placed on the property. The mortgage was then transferred on 1991/05/07 to the Toronto Dominion Bank, probably to someone's RRSP to suck funds out tax free. The TD Bank took no action which can only be explained by the fact that they were just facilitators for the RRSP. Dave talks about real estate bubbles bursting. Guess when the last one was? Yes 1990, just after this sale, and just before the transfer of mortgage (charge). I believe Banks and Trust Companies no longer allow this scam in case anyone just came up with a great way to colapse their RRSP tax free. It should also be mentioned that the assessment was too high since the house built in 1900 is now a tear down. Jayz also deserves thanks for his informative and interesting update to Dave's post.

[Dave2]

I get it the bad news is that you lost your 50k bid to a $370k. What's the good news? you have similar lots to sell under?
 
What's with the 3.6m deal almost 30 years ago? Money laundering? Assume some 15 small lots along the road in front of the subject lot were later severed off the lot and sold for profit, numbers are still way off. It makes sense the original owner's name looked Chinese and the guy who "paid" millions of dollars for the lot and then abandoned it lived and may still live on Forst Hill.    

No I bid a lot more then $50,000 and still got clobbered and in the past it was probably a smart Chinese person who to celebrate the year of the horse (1990) wanted a way to bring attention to himself or herself.  

I don't think we should focus on the past but the present.  My stupidity is already known and I got clobbered.   So be it as I make more mistakes on tax sale bids then successful ones.

The $3,600,000 transaction in 1990 was real.   In 2017 the question of the hour is does the tax sale winner (once they get title) have an over $3,000,000 potential Profit on this transaction.  Us locals think not but what do we know, look at how we bid.

Jayz: I couldn't figure where you were.   This the type of possible deal I expect a smart Chinese person to pull off.   I didn't bother to take down the name of the winning bidder but from the number of people present yesterday I wonder if a person originally from Indian subcontinent maybe showing you and I how the game is going played in future.  Maybe that is why the last name for so many Sikhs means "lion" (Singh).  

Got to give them full respect as they obviously are willing to put their money where their bids are.  

[mountainman]

I am Mountainman

It was a loony bin

Mountainman did not win,

I did come close

and didn't lose to any pros,

My good friend Dave was there

and later he did try to share,

But what he was selling

no one found compelling,

I see who here is back

my old once close friend Jack,

Your wife told you to stay away

but against her wishes you do stray,

Jack, you play too many games

you are a man of many names,

So post no more

you are quite the bore,

Post again

your name I will explain,

Do not hide like a coward

because on you I have soured,

I know all the truths

you stupid f&*#ing boobs.

For I am Mountainman.