Oshawa Property

[Frank]

Hi,

Someone was telling me that if they allow a home close to Toronto that appears to look good on the outside go for much less than the fair market value of surrounding houses then it will bring down the value of surrounding homes.  I'm not sure if the sale price of tax sale properties counts in these determinations. 

Sasha

Speed is correct, the Municipality doesn't care and has no control over the final price, as long as it gets its minimum bid then it has to release the property.   Obviously, if the price is higher then they will have a kick at the excess proceeds once another year has passed and no one claims it and therefore could stand to gain more from a higher price - but the minimum tender price is the benchmark they must adhere to.

When MPAC does market value re-assessments, they take all transactions in each area to determine the appropriate values - however, they discount any transactions that were not made at arms length and any distress sales such as forclosures and tax sales.

[Bobby]

Winning tender amount has to be minimum  $$$$ prescribed by the municipality which includes the all the back taxes owed up to the point  the certificate is registered against the property. However at the time of closing buyer has to pay the taxes from the time of certificate registered and current which could be a minor amount. Like in the case of Oshawa propert the taxes owed were $18K+ are included in the highest bid of $141150 plus the closing cost and tax adjustment..

Does any one know how did they resolved the legal issue which was raised on the date of sale by one 2 of the participants..

[ruteger]

The issue was resolved by cancelling the sale and running it again.  Just got my letter.  Not sure what the problem was as the ad said to use the prescribed envelope and form.  Pretty simple.

[Sapajou73]

The problem was one of the top 10 bidders requested that anyone whose envelope was not clearly marked "Tax Sale" be thrown out because it wasn't in accordance with the municipal act, therefore was not a valid bid.  Seeing as most people just handed in the envelope the city gave them for there bid as is without writing "TAX SALE", this would probably have left him as the highest bidder.  So, the deputy treasure decided to look into and i guess the decision has been made to do the tax sale all over.

[Sasha]

Hi,

I sent in a bid but never got any letter.  I'm out this time though, since I can't go as high as $141,500.  The same bidder will probably bid again.  It a little to much to pay for that house, since I haven't seen the inside, just the outside.  Too close to the fair market value and the assessment value.  If it needs $$$ work done, then buying through MLS is just the same value. 
I thought tax sales were a way that person could get a good deal for a home that they normally couldn't afford, either for investment or to live in.

Sasha

[Apex]

Just got my letter today too. Like I  said before I was in that house before the tax sale. It was listed with real estate. I put in an offer of $110,000 cash but got no response from selling party. After my offer the real estate agent took the house off the market since the client wouldn't deal with any offers. I figure it needs  at least $ 30,000 in repairs, thats why I think the winning bid was way too high. Doesn't  matter now they get to try again. Good luck.

[ding]

hi everybody I am quite surprised  the amount of the winning bid although this is my first time to bid in tax sale . I first consider the prevailing market price plus any crown fees  to be added  cost on top of the bid price plus the cost of repair of the house and I am not expected to go that high .  That drove me to a conclusion that will be over price. just as sascha quote you are right I can buy much better house in that  amount of money in that area. For those who want to bid again I wish you luck.

[speedfreeksteve]

hi everybody I am quite surprised  the amount of the winning bid although this is my first time to bid in tax sale . I first consider the prevailing market price plus any crown fees  to be added  cost on top of the bid price plus the cost of repair of the house and I am not expected to go that high .  That drove me to a conclusion that will be over price. just as sascha quote you are right I can buy much better house in that  amount of money in that area. For those who want to bid again I wish you luck.

If you're looking to buy for an investment you should also include your time involved, cost of selling, land transfer tax, other taxes, opportunity costs (cost of tying up your money in the house instead of somewhere else), etc.

To me on a 165k potential house your looking at 10-15k in taxes and incidentals and then if its going to take 30k to fix it up, and then you're tying up your money in it. Assuming prices don't go up alot (which they haven't and probably won't in Oshawa) then unless you can get it for maximum 110k then I wouldn't even bother, even at that price I'm not sure that I would. Put your money in a decent investment and make the more money without the running around and hassle. Tax sale doesn't always mean "good deal", especially the last few couple years.

[Sasha]

Hi,

Thats exactly what I thought.  Mutual funds (the ones that follow the TSX index) have returns of more that 10% per year, most bank portfolios that are diversified are paying much more than current interest rates.  My GIC, that I cashed in to make a bid was paying 4% per year interest and U.S $ GIC are paying more in interest and there's a chance that the CAD $ will keep going down (although its been hovering between 88 and 91 for the past while) to make even more money. 
I think $100,000 is too much to pay for the Oshawa house, it certainly isn't a 'good deal'.  A good deal would be 70K or 80K and after the house was repaired and all outstanding fees paid, the new owner could sell and still make money or live in the house and, even in a down market still make a profit.  Appartantly, new home builders have reduced the prices by 16% in the past year.  The houses in areas with no new homes in established areas are still going up, older homes in areas where new homes are being built nearby are going down, unless the person owns acreage that may be attractive to a builder.  I think too many people are anticipating a real estate boom, one that is now coming to an end with very slow growth.
I was just looking on the mls for an investment property, a home that currently has renters.  If I bought the property with more than 50% down payment and the current renters stayed, after paying utilities and paying for repairs and other costs to owning and renting a home and the interest on the mortgage (although interest rates are quite low compared to 20 years ago, I bought a home in 1991 at 9.5% interrest and a friend bought her home in 1988 at 12% interest), my return on the investment would be 6% not much more than investing my downpayment in a good bank investment vehicle, I'd be counting on a capital gain at the time of selling, that is hoping that the price of the house would go up.  That's okay, if I could keep the house for many years, since eventually it would go up and if the there was no problem renting it if the current renters left.  My employment situation at this point isn't stable, so I hesitate.
Besides, having lost before on a home sale that was my principle residence (sold for 10K less than what I bought it for and had a mortgage of 9.5% and was out of work for a while) its now my principle to never buy a home unless I can afford the entire house price (without a mortgage) and I can't at this point, perhaps a tax sale home.
Sasha

Sasha

[Sapajou73]

Anyone know the closing date of the oshawa tender?

[Bobby]

not advertised yet .. keep watching  good luck...

[lonewolfsek]

Does anyone know the guy that won the first bid. Or does he post on this site?