All Forum Posts by: Account Closed

Technically, the owner will not have title to the property to sell to you if the property is sold at the tax sale. The tax deed conveys title to the purchaser, subject to the owner's one year right of redemption. The tax deed will go somewhere close to market value (likely in the neighborhood of a 10-20% discount) and you have to pay all cash on the day of the sale. 

IMO, the only way this will work with any sort of certainty is if you get the house under contract, pay off any lien(s) before the tax sale tomorrow, and then close a traditional sale with the owner (or wholesale it).

There are a lot of moving parts with this and I would not recommend this type of deal for anyone other than an experienced investor with significant cash reserves to potentially pay off additional liens, etc.

Georgia is a tax deed state.

The first step is getting the tax sale cancelled, which will require an investor to pay the back taxes. The only way someone will do that is with a contract to purchase. So you also need to come to a price with the owner that you can market to investors. Time is awfully short. Even if this particular deal doesn't work, this strategy is a reasonable way to find motivated sellers/future deals. 

If the property goes to tax sale, it is over. The owner will have to pay the back taxes plus 120% of the sale price to the purchaser of the tax deed. 

Similar to the stock market, there is no way to predict the answer to your question with sufficient confidence to make a market timing decision. And even if someone could make an actionable prediction, you would not be able to sift through the other, incorrect predictions and pick out the person with a crystal ball. It sounds like you are just looking for people to confirm your own view that the Atlanta market is over priced. 

Sure, cap rates in the desirable in-town neighborhoods for MLS-listed properties trade for sub 5% cap rates. You get what you pay for. Those properties will rent quickly to quality tenants and typically sell quickly at close to market price. You give up potential return for convenience and liquidity. If you want an 8-12% cap in a reasonable school district, you're going to be in the suburbs.

If you want a guess about future prices in Atlanta, appreciation will flatten but a significant dip is unlikely. Interest rates will remain low (on a historical basis) for the next few years. Multi-family real estate is a popular asset right now. Everyone is waiting for a dip to buy more. The homeownership rate has significantly declined and that is unlikely to quickly reverse in the next few years. Fortune 500 companies continue to move to Atlanta and jobs are plentiful. Don't hold your breath for a bust.

Sorry to be the bearer of bad news, but you are about two years too late to find any deals on the courthouse steps in metro Atlanta. You will be shocked at the prices people (hedge funds and the big residential real estate funds) are paying sight unseen on the steps. Keep in mind that you also have to pay all cash at the time of bidding. 

 Yes, I do. Absolutely agree re out-of-staters. 

Funny that you mention Brookhaven - finished up a teardown/new construction in the spring through a JV with a builder that I met through BP. Exit in the mid $700s. Net-net profit was $220k, split 50/50 with the builder. Sure, the risk may be higher, but I would call it justified where the project ROI was 45%+...

Under $260k with your parameters, I would look to the northern suburbs, Roswell, Alpharetta, and Marietta. In my experience, the market for small multis in good areas around Atlanta is extremely tight. 

How do you plan to make money on it if the tax liens equal the value of the house? Someone is going to have to pay those off. There is literally zero margin. Move on. 

You need to speak with a bankruptcy attorney. It sounds like you may be an unsecured creditor for the balance due (depending on what you mean by "mortgage note") or are a secured creditor in the house. Regardless, the property is an asset of the bankruptcy estate because it was owned by the property manager at the time he filed for bankruptcy. That means you can't "take it back" unless it is abandoned by the trustee. That would be bankruptcy fraud. It is also potentially bankruptcy fraud if the owner didn't disclose the property as an asset on his schedule. You need to make sure that you are listed as a creditor on the schedules.

Ultimately, you will likely get pennies on the dollar through the bankruptcy process but: 1) you need to speak with an attorney to avoid missing critical deadlines and 2) it is unlikely you will get the property back, which sounds like it may be a blessing in disguise.