Transcript:
Welcome to the Tax Sale Podcast, where tax sale investing is made easy.
I’m Casey Denman, a tax sale veteran, expert, and trainer, author of the tax sale playbook, founder of the tax sale academy and your host here on the tax sale podcast.
Thanks for joining me on today’s podcast, and as always, at the conclusion of this podcast, if you’re looking to learn more about investing in tax defaulted real estate head to taxsaleacademy.com. That’s taxsaleacademy.com.
I also wanted to remind you that we thoroughly appreciate those listeners who have taken the time to leave a positive review. We do this podcast completely free and are so very appreciative of every single positive review in return.
Alright, on today’s podcast we’ll be discussing The Perfect Investor. That’s right, if I can sit here and describe the perfect investor in my eyes, what would that person be like? Well, first off if you read that title and thought I was talking about myself, please understand I’m not nearly that egotistical. Secondly, I’m a far cry from what I’m about to describe.
As you’ll quickly see, the word “perfect” implies that everything is always done correctly. As humans, we can’t possibly be perfect. We all make mistakes, do too little in some aspects and too much in others. None of us our perfect, nor will we ever be even if we invest 30 or 40 years worth of experience into this business.
But, here’s what I want you to understand: The closer we are to being perfect, the better investors we’ll become. Our goal should be to be perfect – not because we’ll be better than anyone else by being perfect, but simply because a perfect investor will be someone who makes a tremendous amount of money and changes other’s lives by investing into communities who rely on that tax revnue. So as we work through a few different aspects of the perfect tax sale investor, do a little self reflection and determine how YOU specifically can be just a little closer to perfect in each of these areas.
The first way that the perfect investor would exist is through a complex understanding of tax sale laws. Take a few minutes at the end of this episode and simply google the words tax foreclosure state statutes followed by your state’s name. It might require a bit of digging, but what you’ll eventually find is that there are pages upon pages and statute subsection after subsection. I had some who wanted to become a tax sale investor one time tell me that he isn’t going to read all of that stuff since it was too boring. I’m not too sure what ever happened to him, but I highly doubt he ever got into this business or that has saw very little success if he did. The tax sale laws do not exist for us tax sale investors, they exist to replenish to revenues to the counties and to return the properties to a tax revenue producing status again. We only benefit in a secondary nature. This entire system only exists through those laws. This isn’t bank owned stuff or conventional real estate where the buyer and seller can agree to rules. The rules that everyone must play by are in state statutes. And the perfect investor knows and understands this. They take the time to go line by line through the state statues, cross referencing those laws with other subsections that might apply, then they research and understand everything in those laws. In many cases, the perfect investor will understand the tax foreclosure and sale laws better than anyone at the county office any attorney. And they would do this for every single state they invest in. Make this your goal and you’ll then understand the rules to the game you’re playing.
The next way the perfect investor exists is that he or she researches properties . . . and when I say researches, I mean they research the property like crazy. They know every single thing about a property. I’m not just talking about size, shape and value. I’m talking about the history of that property, ownership history, developmental history, building history, that kind of stuff. The perfect investor is a historian on that property. In the situation where every goes as planned and where the property is perfect, then that surface level research might be sufficient. But the perfect investor wants to cover all bases. Prior to placing a bid on any property, they have already determined how successful that investment will be for them based on their research. If you know every single thing about a property, you simply can’t lose. Obviously, this is not possible – we can’t look into the future, for example and know what the market is going to do. With that said, 99% of the time if something goes wrong it will fall back on your research or due diligence. So it’s your job to get as close as possible to learning everything possible about a property pre purchase.
The perfect investor never has an issued with funding transactions. They have an unlimited budget. I’ll admit it that we are all limited in some degree because of our budgets. We can’t buy every single property we have ever wanted to invest in, simply because we can’t afford it. While we can’t become the perfect investor in this regard, we must understand that we should absolutely push past the limitations we have in our heads. You’ll likely start out with a small budget of sorts, possibly even through a small loan or credit card. You’re goal should be to use those funds, make a successful investments and then keep building and growing. This occurs in two ways – the first is that you reinvest, reinvest, reinvest. If you want a long term sustainable business you must reinvest. The second is through OPM or other peoples money. The other person could be your rich uncle, a partner, a family member, a local bank or your buddies at Visa, Mastercard or American Express. When you understand the process, have success and know how to grow why wouldn’t you do everything in your power to find more capital to invest? And I don’t me to casually mention it to one person. I mean you should be hunting for more capital – the more capital you have the more you can make. Source capital relentlessly.
The next trait of the perfect investor is that they are in every market. They attend every single sale in the country and cherry pick the most profitable property at each market. Obviously, this isn’t physically possible. We can’t possibly be at every single market. But, what we can do is make an effort to cherry pick the most profitable properties for us in your local area first, then we can expand from there. Ideally, you should get to the point of having a dozen or two dozen different markets that are you’re go tos for cherry picking properties. Now, it’ll take some time to get to that point, but that’s the goal. The goal is to have a never ending supply of cherry picked properties from as many markets as it takes, so you can resell, reinvest, grow and make money, right?
And the last trait of the perfect investor that I want to discuss is that the perfect investor sells properties quickly and easily while making money to grow. And this is something I’m crazy passionate about. I’ve been in business when the average time on market was six months or more for the standard real estate. And when that happens, your business will die. I’ve also been on the other side when I’ve had buyers lined up prepurchase, then I bought something and resold it just about immediately. This limits risked, allows you to flip your capital faster and allows your company and income to grow much faster as well. There are a number of ways to do this, I’ve taught some on this Podcast, others on my YouTube channel and obviosuyl we go in depth inside the academy, but what I really want you to understand is that the key to successfully pulling off these strategies is to start them sooner rather than later. One of the strategies is to use a buyer’s list. I didn’t start this until I was well into the business. Had I started it day one, I would’ve had much more success much sooner. So, if your goal is to sell your properties instead of a long term hold such as a rental, then I highly suggest you work on a process that allows you to sell your properties quickly opposed to holding them for 3, 6, 9 months before they sell. The perfect investor is able to sell extremely fast.
So, if we had to characterize the perfect investor, here it goes:
They know every single tax sale law inside and out. They know every single little thing about every single property they’re investing in. Funding is never an issue. They invest in every single market. And their selling process is profitable and fast.
As we mentioned, you can’t be the perfect investor. But if you keep these five points in mind as you’re creating and operating your business and you strive to be as close to perfect as possible, you’ll certainly make more money with much less risk.
This business takes effort and time, but with the right approach you’ll find it as incredibly enjoying and lucrative.
I truly hope you found today’s episode helpful. If so, please don’t forget to leave some positive feedback and subscribe to our podcast.
If we can help you become just a little bit closer to the perfect investor, please head on over to TaxSaleAcademy.com where you can order my Free book, The Tax Sale Playbook or you can go ahead and join the academy if you’re ready to take action today.
Take care and make it a successful day!