Here’s a message that I recently received from RealAuction.com with good news for investors in the Florida online auctions.
The institutional buyers might consider it bad news, but it’s good news for the individual investor, because it goes further to level the playing field between the large investors and the small investors by making it more difficult and costly for investors to bid under different tax ID numbers.
The time is now!
Now is a good time to get in on the Florida online tax sales which are going on now and throughout the month of May. If you need help getting started with online tax lien investing, check out the Buying Tax Liens Online home study course.
Here’s the message I received from RealAuction.com:
As you may be aware, beginning with the 2012 auction season many counties have made the decision to no longer allow the use of sub-accounts for tax certificate auctions.
The decision has recently been made to prohibit the use of advanced bidder account management tools that will effectively circumvent the spirit of the “no sub-account” rule. As a result, for counties that do not allow sub-accounts each Tax ID account will now require an independent registration, bid and deposit (where required).
**Please note, you will only need to register once for each Taxpayer ID. Once registered, the Username and Password for that account will work in all Realauction-hosted counties.
We understand many of you received notice these account management tools would be available and we apologize for any inconvenience.
Respectfully,
Realauction.com
By Dean Platt June 1, 2012 - 8:30 pm
Joanne,
I must tell you that I just completed an auction in one of the counties in Florida that has done awy with the sub-accounts. I was successful in obtaining the desired investment amount that I had planned for, but I was not happy with the mix of properties I obtained. I say this because even without the sub-accounts, the institutional investors have still found a way to game the system to their advantage. I only got two of the prime single family home classified properties out of the hundreds of properties I bid at the minimum of 0.25. The institutional buyers still have a mechanism of having a “LOT” of bidding numbers per their identity. With their multiple numbers, the individual buyer is essentialy boxed out when the computer selects the winner of the tie bids. The institutional buyers get awarded almost all of these 0.25 bidded single family home properties. I am still happy with my own results, but this stacking the odds in the favor of the institutional buyer is an unfair process. Leading up to next years auction, I will be investigating how I can level the playing field for myself, and/or I will be contacting my state reperasentatives to try to change the statutes to eliminate this stuffing of the auction box.
By Joanne June 4, 2012 - 12:37 pm
Hi Dean,
Contacting your state representative is a good idea, you may also want to send an e-mail or write to the tax collector of each county that you bid in Florida, and also contact the auction platforms that responsible for conducting most of the Florida auctions – RealAuction.com and GrantStreetGroup.com. They are the ones that responsible for implementing programs to make the bidding process fair.
By Save Sum more May 28, 2012 - 6:35 am
I disagree with your realauction.com posting…if this is a real blog. Miami area just had their’s and not only do they allow you to represent …in the cases I looked at…250,000 investors, they bid down to .25% on every piece of property in mass quantities of buying. What a waste of time.
By Joanne May 29, 2012 - 8:21 am
Hi Save Sum More,
You can disagree with the post, but this was not something that I came up with, this was a message sent to me from the online auctioneer. Not all of the counties in Florida did away with sub-accounts. There are a few that haven’t done this yet and Miami-Dade is probably one of those counties that are still allowing sub-accounts. Also you must realize that investors, especially institutional investors would not bid down to .25% unless it was profitable for them. The reason that they do that is that in Florida there is a minimum 5% penalty, so if and when the lien redeems they will not get .25% per annum on their money, but a 5% penalty instead. And this is a straight penalty on the certificate amount. So it doesn’t matter if the lien redeems in a year, a month or a few days, they still get a full 5% on their money. If this is what banks are doing then it is certainly worth it for individual investors. Where else can you invest only a few hundred dollars and make 5% on your money in a secure investment?