Investing in both tax lien sales and foreclosure sales in Miami-Dade County is viable and profitable because of the available inventories, the relatively low prices and prospects for lien redemption and home resale.
Tax lien certificates in Miami-Dade and in other counties of Florida are attractive because these counties allow up to 18 percent in interest rate and the redemption period is two years. Miami-Dade also conducts its tax lien auctions online at BidMiami.Dade.com, giving access to out-of-state and international investors.
The state of Florida uses the percentage bid-down scheme, under which Florida counties issue the tax certificate to the investor with the lowest interest-rate bid – the percentage rate the winning investor will get as a profit. The winning investor pays the delinquent tax amount, in addition to the interest, cost of advertising and sale, and the tax collector’s fee of 5 percent.
In addition to investing in tax lien sales, investors can also buy lower-priced foreclosed homes in Miami, FL and then rent them out or resell them when prices finally reach profitable levels. Foreclosure filings slowed down in Miami-Dade in the first 6 months of this year compared to the same period last year, but the numbers are still at a strong level for investors.
Based on a report from a firm specializing in South Florida properties, there were 34,500 foreclosure filings in Miami-Dade and in other South Florida counties in the first half this year, down by 33.9 percent from 52,200 during the same period in 2009, by 8.7 percent from 37,800 in 2008 and up more than three times from 8,000 in 2007. These numbers were also gathered from records of real estate foreclosure houses in county courts.
The more than 42,200 units of Florida foreclosure homes in the first 5 months this year also represent great opportunities for investors, in addition to profit opportunities in tax lien sales in many counties in the state.
Search foreclosed houses in Florida cities:
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