Bidding Strategies for Tax Sales

[Matt Sse]

As I mentioned in my previous post I'm looking for a large acreage in the Cochrane area.  If a tax sale were to come up on an ideal spot I'm just wondering how I should bid?  Is there a strategy people employ?  I would tend to think the property would not be highly sought after so maybe I could just bid the minimum bid +$1 (in case someone else bid the minimum bid).  Or would I be more succesful overall bidding say 20% more than the asking price?

Your thoughts are greatly appreciated.

Matt

[Frank]

As I mentioned in my previous post I'm looking for a large acreage in the Cochrane area.  If a tax sale were to come up on an ideal spot I'm just wondering how I should bid?  Is there a strategy people employ?  I would tend to think the property would not be highly sought after so maybe I could just bid the minimum bid +$1 (in case someone else bid the minimum bid).  Or would I be more succesful overall bidding say 20% more than the asking price?

Your thoughts are greatly appreciated.

Matt

Hey Matt

Minimum, or plus $1...doesn't matter.  What you are really talking about is buying something that no one else is bidding on.  If everyone figures that $1 more will do it, then you'd better add $2.  Figure this out, if no one else has bid on it, then there must be something wrong with it....and it isn't worth the minimum anyways...in which case you just bought a lemon. 

Chances of no one else bidding on something that is worth it are slim to none - but it does happen.   If you want to take that chance, then go for it, however...you may have to invest a lot of money bidding on a number of properties before you land one (every time you place a bid will cost you for things like travel...to see the site...registry search....deposit guaratee, etc..., and this stuff can add up if you making multiple bids).

Better off doing your homework, and figuring out what the property is really worth, then bidding whatever you think will get you the win.  Sometimes you will leave money on the table...that is you didn't have to go quite that high to win.  Other times you will bid short and be kicking yourself for adding another few bucks to get the win.   It's definitely a crap shoot since it is a closed bidding process...bottom line however is never bid more than the property would be worth on the market (unless you have a special interest, like the property abuts another one you already own, and you really need it to round out the whole package...in that case it would be worth more to you than anyone else, and you'd better bid high).   

Finally, if you find one that you like, don't tell anyone...except me of course.

[Pfm1011]

In addition to what Frank says

Always keep in mind the total cost of your dream. You will spend a pile building a house, servicing etc . Who really cares if you spend 5 or 10 k too much on the right piece of land when the house and servicing will cost you several hundred K

If piece has a 5K min, in the big picture does it really matter if you bid 15 or 20K and get the piece of land you really  want?  I personally would cry if I really wanted a piece to build on and lost by a couple K just being cheap.   

Now if its land you simply want to flip , then that is where the pencil sharpening and games begin.

On the other hand , you can be cheap , bid $1 over min and cry every tender as you get slaughtered  . As Frank says, if you do win at a dollar above min..you probably overpaid. There is tons of pieces out there where the min greatly exceeds the commercial value of the land.

[Matt Sse]

Thanks for the great advice guys.  Never having bid myself I didn't take into account the extra costs.  Additionally I thought I would mostly be buying site unseen since it is so far from my home.  I appreciate the advice and I'm starting to wonder if it would be safer buying privately vs. a tax sale, it seems the little extra cost may be worth it to avoid the hassle and the potential for liability.  All I ever wanted was a piece to vacation on/retire to.  It's too bad I can't just pay someone to work the tax sales for me.  I would save over market value and the person I'm paying would make some cash doing the leg work.

Thanks again,

Matt

[farrouk]

Matt:
I am new at the game but from what I have seen in the last year you might have a chance picking one up for the minimum in far north. Most of us tax sale hounds are in southern ontario and are not too interested in the ones north of the French River. You will have to go only against locals which away from the larger towns means very few people. Dignam bids on the larger acreages but never goes very high.

[Matt Sse]

Farrouk, thanks for the tip.  I have looked at Dignams land and considered purchasing it.  I wonder what kind of bargains they get at tax sales in the far north?  Do you have any ideas about how much they mark up the property they purchase before putting it in their catalog?

Thanks,

Matt

[markymark]

Matt They buy land only to sell it at a profit.They would have to sell it for double to profit.

[Matt Sse]

Double!  If that's the case maybe I should stick with tax sales because there must be some GREAT bargains out there.  But I guess once they pay for the land, associated fees, run a company and put out a catalogue it would probably work out to double.

Matt

[farrouk]

I also believe Dignam has a policy that if you don't like your property you can trade it for another with a small admin fee. Selling a dog you bought in the far north at a tax sale could be a real tough proposition. You might just want to go around low balling MLS listings that meet your criteria, you never know.

[markymark]

Some great bargains,yes .But you have to take into account you will look into all to find your bargain and it will cost you time and money
as previously posted.
If you do stick with it, Frank and Pfm are pro's,and you should take the advice from the last couple of posts.
Good Luck.

[Pfm1011]

I have no idea if this works for you..  300 acres being sold by the Sheriff in north Parry Sound   . Check the ontario gazette Nov 1st under sheriffs auctions.   The catch..Under sheriffs auction you are responsible for all mortgages and liens so do a good title search and you must attend the auction

UNDER AND BY VIRTUE OF a Writ of Seizure and Sale issued out of
the Superior Court of Justice at North Bay, Ontario to me directed, against
the real and personal property of URSEL WOLFF, Defendant, at the suit of
ROD HAMPEL, Plaintiff, I have seized and taken in execution all the right,
title, interest and equity of redemption of URSEL WOLFF, Defendant, in
and to:
PIN #52234-0102 being Parcel 17032 Parry Sound North Section being Lot
13, Concession 14, Township of Wilson, District of Parry Sound save and
except Part 3 on Plan D-77.
PIN #52234-0103 being Parcel 10864 Parry Sound North Section being Lot
11, Concession 14, Township of Wilson, District of Parry Sound and Lot 12,
Concession 14, Township of Wilson, District of Parry Sound save and except
Parts 1 and 2 on Plan D-77. S/T Part 1 on Plan 42R-14484 as In LT222581,
LT222671 and LT257432.


All of which said right, title, interest and equity of redemption of URSEL
WOLFF, Defendant in the said lands and tenements described above, I shall
offer for sale by Public Auction subject to the conditions set out below at,
Sheriff?s Office, Court House, 89 James Street, Parry Sound, Ontario on
Monday, December 8, 2008 at 10:00 a.m.
CONDITIONS:
The purchaser to assume responsibility for all mortgages, charges, liens,
outstanding taxes, and other encumbrances. No representation is made
regarding the title of the land or any other matter relating to the interest to
be sold. Responsibility for ascertaining these matters rests with the potential
purchaser(s).
TERMS: Deposit 10% of bid price or $1,000.00, whichever is greater
? Payable at time of sale by successful bidder
? To be applied to purchase price
? Non-refundable
Ten business days from date of sale to arrange financing and
pay balance in full at 89 James Street, Parry Sound, Ontario
P2A 1T7.
All payments in cash or by certified cheque made payable to
the Minister of Finance.
Deed Poll provided by Sheriff only upon satisfactory payment
in full of purchase price.
Other conditions as announced.
THIS SALE IS SUBJECT TO CANCELLATION BY THE SHERIFF
WITHOUT FURTHER NOTICE UP TO THE TIME OF SALE.
Note: No employee of the Ministry of the Attorney General may purchase
any goods or chattels, lands or tenements exposed for sale by a Sheriff under
legal process, either directly or indirectly.
Dated at Parry Sound, Ontario this 21st day of October, 2008.
Enforcement Office
Territorial District of Parry Sound
89 James Street, Parry Sound
(141-P349) Ontario P2A 2T7


maps.google.com/maps?f=q&hl=en&geocode=&q=&ie=UTF8&ll=45.91581,-80.040464&spn=0.020183,0.060339&t=h&z=14

It does NOT extend to the large lake at south .Image overlap essentially runs down center of property .

[markymark]

That's exactly what I was looking for .Thanks Pfm.
But auction bidding fetches stupid prices ,like mls?

[Pfm1011]

Like all auctions, Sometimes its stupid, sometimes its deals

[Rob]

That's exactly what I was looking for .Thanks Pfm.
But auction bidding fetches stupid prices ,like mls?

You might get a deal in this marketplace.  Good luck

[markymark]

Thanks again I'll give it a try.
I'm interested in acres east of peterborough but can't title search on the 11th.
Bidding blind?