I want to invest in tax homes so I can rent them out. Who do I talk to about buying these properties?

-Connie

By tax home, I assume you mean those mythical houses that you can purchase for just the property taxes that are due.

Unlike the unicorn, these probably do pop up from time to time, but it is very unlikely that only the back taxes are due on the home. Any municipality that has such a property would undoubtedly confiscate the property and sell it on the open market at a price closer to it’s true market value.

There are investors who purchase homes on the courthouse steps for very low prices, but you need to complete your due diligence prior to showing up at one of these sales. You need to know the condition of the homes you are interested in purchasing, and you need to have some idea of what the repair expenses are going to be. You will also need “hard” money to purchase the property. These sales do not have the typical contingencies for inspections and financing that most sales allow. You also need to know what the market rent is for any potential property and decide what kind of return you are willing to accept.

I recommend attending some of these sales and observing before jumping into this. Speak with a REALTOR® that specializes in these types of investments in your area.

Best of luck with your future investments.

David Welch specializes in residential re-sales and new home construction at RE/MAX 2000 Realty in and around Orlando, FL.

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Do you have any advice in searching for a rental investment? Areas to target? -Mary

Rental properties, I find, are best when they are in a 10 mile radius of your home. You need to do the math. Do a rent survey and compare that to the payments fully loaded. Single family homes should always outperform condos or units. Check all numbers with your CPA.

Phil Immel is a Real Estate Broker for Prudential California Realty in Monarch Beach and Dana Point, Ca.

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