DIRTY TAX LIENS
Lots of Pay Dirt
“Buy land, they’re not making it anymore.” Mark Twain must have been talking about raw land, real dirty dirt, the kind you can hunt, fish, farm, raise a family, and forge a livelihood on, if the weather cooperates.
Raw land in and around Loveland and Berthoud is getting harder to find. Our farm land, pastures, and foothills are giving way to subdivisions, employment centers, and commercial centers.
Recently, my MLS provider’s database revealed 46 active listings of land ranging from 35 to 160 acres. You can buy 35 acres for $74,000.00 or, if you want to buy an entire subdivision of 118 acres, you will have to pony up $8,389,093.00.
More down to earth (excuse the pun), I found only two active listing for vacant land from 20 to 35 acres. From 5 to 10 acres, there are 25 active listings. From 1 to 5 acres, there are 169 active listings. Why so many? One of the reasons is that the minimum size for lots outside of the cities is 2.3 acres. County subdivisions are platted with this fact in mind.
The real bonanzas in land are lots less than one acre in size with over 460 available. These lots are typically found in approved subdivisions where you are not allowed to build your own house, unless you are a licensed and approved contractor. Some purchasers are able to bring their own builder, but many purchasers use the builder who is selling the lots.
In order to get a different perspective on the land business, I attended Larimer County’s annual tax lien sale. All 280 of us were in a buying mood because an 11% annual interest rate is not easy to find these days. With over 3000 tax liens for sale, everyone had a chance to spend lots of money, with some people spending several hundred thousand dollars.
What struck me about this year’s sale was the number of improved lots and also small tracts. I counted over 300 lots in the Loveland area with tax liens from as little as $20.00 and as much as $2000.00. Typically, lot owners do not pay their property taxes until the property is sold to a builder or to you. The owner can lose the property if taxes are not paid for 3 years. Does it happen? Yes, but not often.
What is my point about talking about lot liens? Whether you are an investor or just want a good deal on a lot or a piece of land for your dream house down the road, this is a great time to talk to your Realtor. Buying a lot now is like buying a sweater in the summer; both are priced to sell.
When you find a piece of land that you would love to buy, you can find the owner/seller by poking around the Larimer County website. Your first step is to visit the County Assessor’s home page and link to the Larimer County Parcel Locator. The Parcel Locator allows you to zoom in to a single lot labeled with a parcel number. You can even see the lot’s dimensions. Once you have the 10 digit parcel number, your second step is to go to the County Treasurer’s home page and find out who pays the property taxes.
Whether you do your own search or work with a Realtor, you can bargain with the lot and land owners. As taxpayers, they would rather have you pay the taxes until the business cycle favors real estate again. At that point, you will be happy you bought when you did.
In the meantime, I wonder if my family will accept my paid-for tax liens as holiday gifts.