Galway-Cavendish&Harvey Results

[Dave2]

Here are the results.  Interesting bid opening with about 60% of the bidders in attendance. 

Assessed Value $22,000 for 20 acres of land.  Services at lot line and adjacent to major highway with lots of frontage.  (Two apparent entrances).
Year round access.  Property dry and level on at least 1/2 property to build a couple of residences. 
Within 1/2 a dozen miles of a small village. My own plans were to flip but after I did some legal work like severances etc.

25 bids total but 1 or 2 disqualified.

Winning Bid:  $26,400 from a user who wants to build a family compound. 
2nd bid        $24,900 (3rd time in a row I was second)
3rd - 6th bids at or around assessed values. ($21,500 -$22,500)
7th-10th bids above 75- 80% of assessed value. 

Bumped into WorldJohn from this forum there and had an interesting discussion about his recent winning.  Sounds like he has the right product to make a proper home for the winners on this site.

Anyone else from the forum there?  Given the high level of competition I wondered if the people who usually go after Muskoka had decided to try their luck in cheaper waters

Dave2

[worldjohn]

sorry about your hard luck 2nd place finish again. But you're due, cause you have been bidding smart. keep going.  Im going to keep the low bids coming and wait for some more luck. And yes I do have tons of stone and marble in madoc for anyone who needs it.

[Jayz]

I must have a lot to learn.

When I checked it out in winter when it was first offered, it was all covered by snow, probably rocks underneath, with trees, wet front (actually under water), and I didn't see any level space. I thought it must require a lot of work and money to turn it into a buildable lot. And it's true you don't see any house close by and long way to the south along the county road. I put in a bid, what the hell, for the sake of 20ac, it might look different when it became warmer, just a little over minimum. Then it was postponed. I didn't bother to put in a bid again.

For those who like this propery, if you don't mind the distance or you are close, BONNECHERE VALLEY 100ac property is definitely a better choice, in my opinion. By the way, did anyone follow? what happened to that taxsale?

[Rob]

Winning Bid:  $26,400 from a user who wants to build a family compound. 
2nd bid        $24,900 (3rd time in a row I was second)
3rd - 6th bids at or around assessed values. ($21,500 -$22,500)
7th-10th bids above 75- 80% of assessed value. 

You 24,900?  No wonder you keep coming in second.  Psychologically speaking in terms of bidding you always should round up and then add some.  So if you want to land the property for 25,000 (24,900) you need to bid 27,000  ($26,400 was a smart bid).

You put in time and money, after awhile it makes sense to bid 1,000+ more.  Think of your costs and weight your benefits.


This is not a personal attack   I'd love to start a discussion on bidding, its such a taboo topic.

[Pfm1011]

I have to agree , 24900 is a terrible bid as anyone will automatically go 25000 as it is a round number then they go up to round more, So a bid of 25k actually ends up being 25550 min  but if I wanted to spend 25 k I would really round up around 26, 655 because 26400 is not a 500 round, Anyone bidding 26400 would round to 26500 plus some change.People think in 500 and thousand's and to win you have to break those envelopes.  Its a in for a penny, in for a pound deal.. Goes back to one of my previous posts, who cares about a few k since you are into 100's of k for a cottage .

[Dave2]

You 24,900?  No wonder you keep coming in second.  Psychologically speaking in terms of bidding you always should round up and then add some.  So if you want to land the property for 25,000 (24,900) you need to bid 27,000  ($26,400 was a smart bid).

You put in time and money, after awhile it makes sense to bid 1,000+ more.  Think of your costs and weight your benefits.

This is not a personal attack   I'd love to start a discussion on bidding, its such a taboo topic.

Rob / PFM1011:

It's a taboo topic only in the sense that each case is unique.  I will respond to you both more fully but I need some help from PFM or Steve.  If I recall from an earlier post one of them has personal access to Teranet which if they are willing I would like them to respond to a specific request from me publically using the Teranet information I direct them to access.

In the interim Rob is there anyway that you can post the tender lot plan on this one for folks to read themselves on this Website.  I will explain in future the specific concern I was worried about but I would like to see if others can notice it.  Its a classic case of the devil is in the details.   

Fundamentally for this one I wanted to buy and resell.  Thus I want to buy as cheap as possible.  Note as well this is not a waterfront lot even though it had other values like roadside access.  This means my resale value is restricted in the current market place. 

My philosophy is that it is always easier to get into a swamp then out of it.  The key is not just the buying but also the selling.
 
Initially my response is that fundamentally I would not have changed my bid unless I can see in advance what others would bid.  That's not going to happen.  Jayz has already noted that this one wasn't a beauty screaming for attention.  If it was, it would not be sold on a tax sale. 

[Rob]

Rob / PFM1011:

It's a taboo topic only in the sense that each case is unique.  I will respond to you both more fully but I need some help from PFM or Steve.  If I recall from an earlier post one of them has personal access to Teranet which if they are willing I would like them to respond to a specific request from me publically using the Teranet information I direct them to access.

In the interim Rob is there anyway that you can post the tender lot plan on this one for folks to read themselves on this Website.  I will explain in future the specific concern I was worried about but I would like to see if others can notice it.  Its a classic case of the devil is in the details.   

Fundamentally for this one I wanted to buy and resell.  Thus I want to buy as cheap as possible.  Note as well this is not a waterfront lot even though it had other values like roadside access.  This means my resale value is restricted in the current market place. 

My philosophy is that it is always easier to get into a swamp then out of it.  The key is not just the buying but also the selling.
 
Initially my response is that fundamentally I would not have changed my bid unless I can see in advance what others would bid.  That's not going to happen.  Jayz has already noted that this one wasn't a beauty screaming for attention.  If it was, it would not be sold on a tax sale. 

You've done the assessment, determined the property is not worth more than 24,900.  You determine it is not a gem and may fall below the that 24,900 figure.

Now the question is what do you bid?


In my opinion you have two choices.  I would bid in the 25500+26000+ range..   if you feel the property may be had for lower, than bid 22500 to 23000.  No more. 

Why?  Obtaining a property in a blind auction system is different than bidding on a house in the open property market.  You get one bid, no counter offers.  Someone is always going to bid 25,001 where most people will bid 25,000.

The only way you are going to win a property with a bid of 24,900 is if the next highest bid is 22500 or lower..  so you are over paying a few thousand and you will miss out on that property by a few thousand if the property is had for your assessment value.


Having wrote this, people will begin to bid the opposite way now  

[Pfm1011]

Dave, Is this the lot we are talking about?  I didnt bid on it but are we talking about the same piece??

[Dave2]

Guys:

thanks for the posts.  The challenge on this one is still not easily apparent and interestingly there is seems to be some missing records with respect to the registry office on the deed registration.  Bottom line is that I am concerned about some small pieces of property on the extreme southwest of this property by the road.  They show on the tax information but you really have to look for them. 

They should on registry survey but not deed and I believe they originated with a road realignment.
Interestingly PFM's plan shows the relignment benearth the property but not the portion that is in the extreme southwestern corner.  In a large scale survey printout they are there and they are the reason why I was cautious in my bid.  I figured that eitheir one of the entranceways might be owned by someone else and I would have to construct a new entranceway or buy out the other property owner.

Winning bidder did not know about them and I am not sure what he would have bid if he knew about them.  They are there for real but it appears they do not appear on all records.  He was quite concerned after the bid when they were pointed out to him.  IF he walks then I will have some scambling to do. 

A case like this is illustrative of the need to double check your bid prior to putting final payment down. 
No one likes to lose their deposit but there are cases where that might be the best strategy.

This is one of the reasons why I try to leave some money on the table.  As Frank has noted things close to Toronto are getting expensive with commonly sales going for at or even above assessed value as in this case.  I figured property was worth on resale somewhere between $35 -$60,000 with wide range dependent on severance and resolution of this issue.  I figured with the additional expenses I should be cautious. 

I agree that I can learn how better to bid but with six bids within 20% of each other I think I called it about right.  In another venue someone once told me "IF I ain't losing some I ain't pricing it right"

No matter what happens I have no complaints.  This is the first time I talked my wife of 30 years to join me at one of the openings.  Our bid was early and winning bid almost at the end.  It takes a while to publically open 25 bids with most of the people in attendance who bid.  There was a while it looks like we got it and we were just above a large number of other ones.  I certainly got a lot of credibility with her and thats what counts. 

For the first time the township staff give the names of the bidders.  I learned something that I will not be disclosing publically but I have wondered about in the past. 

With property purchases you have take things as they come.  A saying from Newfoundland comes to mind.  "Takes the goods with the Bads and don't sweat the small stuff".  Over the year I have had some surprises buying property.  Doing an inspection of commercial property I bought in Eastern Ontario
not too long ago we found a coffin.  Only time as well I have ever seen a black painted bathroom.

On the other hand the best real estate investment I ever made was over 30 years ago and the rewards were fantastic and I don't even grow green plants.  I will never get a reward like it ever. What was funny it was a property I rented.   I wrote about it on another website and won an award in the United States for a true real estate investment story. 

If anyone wants to read it and the coffin they can email me.  (I am not certain if Rob will allow it to be posted but I can send him a copy if he wants tp review it. 

Bottom line I hope everyone has success in their bids.  I am concerned about this issue with land titles missing for research in general but it looks like I lost this one.  I have been working this with PFM offline and I think we need to check this out and report to the board if we find something. 

Good Luck:

Dave2

[Pfm1011]

Do these pieces show on the title when you do a search or just old surveys? I presume that if they dont show on the title then who cares as they wouldnt be valid claims. They dont show anything on the LT system .

I did not walk the land so I could be wrong but I think you are abit low on the value, Using the 7 % since the 89 sale makes it worth 83 K. Any building lot should be worth 60 to 70 min anywhere plus at least 1 k an acre for the additional  so again around 80 K  after you get approvals and maybe an initial driveway in so you looking at 10 k more investment.  My guess is you could MLS this for 89K and land around 75 to 80 within 18 months.   Quick flip should be able to get 50 to 60 as is within 6 months

I think the high bidder should be able to double their money on this one very very easily.

Other opinions please.
 

[Frank]

Don't forget...most properties that are up for tax sale, are there for a reason.  Sometimes, the owner is just too far in debt; there could be contamination; it could be difficult land that can't be built on: and , in some cases there is a problem with title. 

I've come across a few situations which are not obvious until you look at the legal description, and trace everything back to the documents and the original surveys.  Do not trust what you see on assessment maps and assessment rolls, as they are often incomplete.

Do your homework, and hopefully you won't get burned.

[Dave2]

PFM:

I think the main difference between our valuations is for the raw land.  I don't disagree with what you said necessarily at upper end if you can get a severance.   That will cost probably close to $6,000 additional (Survey at $5,000 and application fees additional). 

As I mentioned earlier in this case there are 12 different approving agencies so you would be really lucky to get it done by this fall and thus will miss this years cottage buying season.

My caution is that there is a lot of rural land in this area for sale.  I am not sure an unimproved lot will get what you thought unless you put in further investment. 

I usually expect I will have to put something in before I can reap the benefits.  If you look at another one I lost in this area (see North Kawartha post) I did some research as to other similar lot regular real estate sales.  They went for less then $20,000 against a winning bid of just over $12,000.

In the north Kawartha case there was confusion as to which lot was for sale.  The adjacent one with the burned out cottage was the one we were told by the head of planning was for sale.  It was worth a lot more then the tax sale one.   

At the time of year it sold we had to go in on Ski's.  There was only tracks from one other person and
they searched the wrong property.  On the tax sale one we had a major entranceway to construct (at least $5k unless we could get free fill.  (Probably at least a dozen truckloads plus culvert)

Given high prices as previously mentioned we do not have a lot of room to manoeuvre. That is why I am a little cautious sometimes.     

Dave2

[Pfm1011]

Always better to be cautious..no sense winning bids for the sake of winning.

I cant see being able to subdivide the lot as 18 or 19 acres is small for rural, would seem alot easier , and cheaper, to simply get septic and siteplan  approval , maybe dig in a driveway and simply flip it.  No severences required which could take years up there

[Pfm1011]

"Whether you or the other pro's like Frank "

I am a mere amateur compared to many on this site..I'm just long winded

[Frank]

Firstly, I would hardly call myself a 'Pro'....I merely dabble in this stuff, just like the rest of you guys (or girls).  

Secondly, I also have a wife that keeps me on the straights.  So far she's been fairly tolerant, but if I ever lose money on one of these deals, I am pretty sure that I will have all of my petty cash removed.