The Best Strategy to Avoid Competition by Saen Higgins
Getting out bid at an auction is always a let down. The problem is, the most accessible auctions to everyone are the most popular. So those participating in Florida and Texas tax deed auctions for example, are finding the competition fierce due to high attendance.
Now I can’t make sense of anyone bidding too much for a property, which you’ll often see in these circumstances, and I am not advising our students avoid Texas or Florida (both are excellent states to invest in), what I do want to discuss is that for those who shy away from the competition there is an alternative route. Below I’ll describe our strategy for finding success while avoiding the competition.
Choose a state: Ohio, Indiana, Arkansas, and Tennessee, are all states that have straight forward auction processes. For the most part the auctions are live, Indiana does have some online auctions through Zuesauction.com. So, you need to be willing to travel. The competition in these states, though not exclusively, is not nearly as competitive as the highly populated coastal states.
Exit Strategy: The homes and apartments in the states described above are less likely to be A or A+ quality. You’ll find that for the most part, the properties offered at auction are B or C level. Realistically it would not make sense to bring them up to an A level quality….so what do you do? Well, affordable, clean, and up to code housing is always in demand anywhere in the country. The best thing to do is turn an investment property in these regions into beautiful and clean rentals. Likely a minimal profit would be made if you decided to flip and sell. The markets in these regions aren’t the best for that exit strategy, long term rentals however will lead to an excellent investment with regular cash flow.
Show Up: If you take the time to research a list of properties, then show up to the auction, even if all of your properties redeem. It’s important to experience an auction, whether online or live. This will help anyone gain confidence in what they are doing so when the right property comes along, you’ll be ready.
Saen Higgins is the Co-Founder of US Tax Lien Association. He is one of the world’s foremost authorities on the subject of investing in Tax Lien Certificates and Tax Foreclosed Properties. He has been training and speaking internationally for over 25 years. Saen is passionate about sharing his philosophies on real estate investment and creating financial freedom. His extensive knowledge in the field of self-directed retirement accounts has changed the quality of life for thousands and the way they invest. Saen’s devotion to helping people creates true financial independence and is only matched by his business partner, Tony Martinez.
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645 Church St, Bound Brook, NJ
2683 sq. ft.
14,810 sq. ft.