The real estate industry in Georgia is an ever-changing market that can often be difficult to navigate. One way investors can get into the game and potentially make a large return on their investment is through tax deed investing. These investments can provide significant returns when done correctly.
Tax deed investing: What it is
Tax deed investing is purchasing properties that are in tax default. This occurs when a property owner fails to pay taxes, and the government takes ownership of the vacant or abandoned property, selling it at auction as a tax deed sale. The investor will purchase the tax deed with the intention of either reselling it for a profit or rehabilitating it and renting or selling it.
How tax deed investing works
The process of investing in tax deeds begins with research. The investor must become familiar with the laws, regulations, and processes for tax deed sales in the commercial real estate jurisdiction where they plan to invest. Once this is done, the investor should search for upcoming auctions and begin researching each property that appears to be a good investment opportunity.
Next, investors will need to attend the auction and place their bids. The bids are usually purchased with cash or a certified check, though some locations may allow for other forms of payment. If the investor wins the bid, they will immediately become responsible for any debt owed on the property, such as unpaid taxes and liens.
Once the deed is in hand, investors may rent or sell the property. With some effort and investment, these properties can be renovated and sold for a profit or rented out to tenants. Additionally, investors can resell the deed at a higher price than what they purchased it for. This is known as wholesaling and can provide sizable profits if done correctly.
Regardless of the route chosen, tax deed investing offers potentially high returns and can be a great way to get involved in the real estate market. For those considering investing in tax deeds, understanding the process and researching properties thoroughly is vital to ensuring success.