Tuesday, August 26, 2014

Tax Lien Sale, Jackson County Style, Be There or Be Square

On Monday, August 18th 2014, the hottest day of the summer thus far, my friend and real estate investor (same person) and I trekked up to the Jackson County Courthouse Steps for their tax lien sale.  Why?  We're looking for investment properties with lots of potential return on investment.  The public notice published in the Kansas City Star consisted of 24 pages of properties for sale, all at least three years of property taxes in arrears, some as many as 10.

All bidders were supposed to have registered at least 10 days prior to the starting day and all winning bids must be paid in cash.  We were to arrive at 9AM, sale starts at 10 "on the dot".  Delinquent tax payers have until their properties actually go on the auction block to pay their past due property taxes.

You may say to yourself, hottest day of the year, surely they didn't/won't actually sell these properties "on the steps" of the courthouse.  Oh yes, they do.  This is an event folks, a serious event.  When we arrived there were at least 150 people in lawn chairs, perched on the steps or milling around, waiting for the sale to start.  Some in their Sunday best, others in their jammies.   I use the term "auction" loosely, as there is no auctioneer or auction etiquette utilized here.  I'm a farm kid, I know how an auction works, and this my friends is, well, NOT an auction.

Perched under a white tent with two co-workers, sits Carol, a very nice, extremely overwhelmed woman.
Here's the view from our vantage point in the middle, there are at least another 75-100 folks behind us.
Carol, bless her heart, goes through the list, property by property, skipping the ones that have been saved at the last minute. Here's the patience testing part.  In a very non-auctioneer style, she determines there are or are not bids, no going once, going twice blah blah blah, sold. We then wait collectively, me and my 300 new friends, as each buyer, approaches the tent, cash in hand, the office staff counts the funds (as little as $700, as much as $12,000 while we were there, WAITING), next property.  Each transaction takes approximately 10 minutes.  They break for lunch at 1PM.  At the end of the first day, they were on page 3.  Page 3 of 24, twenty four pages, did I say 24?  At the end of day two, today, they are through page 8.  At four pages per day, AND a holiday weekend, we may be through page 24 by next Tuesday.  Did I mention our properties of interest are on page 19 and 21?

I'm not judging, they're on a budget.  It's a great way to source investment properties, not an easy one. I do think there may be a better way to achieve the end result, with an improved, modernized process.

My heart goes out to the residents of Jackson county with delinquent property taxes that don't understand the process.  There were many I met that thought they were there to save their property.  I sincerely hope they were able to do so.  I'll report back on the remainder of the process, once we've made purchases.

Here's to real estate investment, a 105 degree index, and patience, LOTS of patience.  Carol, I'm praying for you girl!

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