How Can You Find The Right Tax Deed Markets?

Last Updated on August 30, 2025

Investing in property tax sales can be a powerful way to build wealth. One of the trainers at Tax Lien School, Josh, explains how his team took US$3 million and turned it into US$7 million in real estate by buying tax‑deed properties at county auctions. This article summarizes the key points from the video and adds background information about tax‑deed investing.

What Are Tax Deeds and Tax Liens?

If someone doesn’t pay their property taxes, the local government places a lien on their property. In some areas, the government sells this lien to investors. These investors pay the overdue taxes and get a certificate to collect the money back with interest. Other places use tax deeds. If taxes aren’t paid, the government takes the property and sells it at auction. The highest bidder wins the property. Some states let the original owner buy back their property later. It’s important to know your state’s rules about tax liens and deeds before investing.

Lessons from Investment Journey

We started buying properties in Houston, Texas, because the rents were high and the houses at tax-deed auctions were cheap. For several months, we bought four to six properties each month. Eventually, we noticed that more people were trying to buy the same properties. So, we decided to look for new places to invest. Here are the main ideas we used to make our choices:

1. Look for a market with high rents and low purchase prices. In Houston, we bought houses for just a few thousand dollars. After fixing them up, we rented them at good prices. This helped us make money fast. Later, we found similar chances in Philadelphia. There, some tax-deed properties sold for only $5,000 to $10,000
   
2. Choose places with regular auctions and plenty of inventory. Look for a market with high rents and low purchase prices. In Houston, we bought houses for just a few thousand dollars. After fixing them up, we rented them at good prices. This helped us make money fast. Later, we found similar chances in Philadelphia. There, some tax-deed properties sold for only $5,000 to $10,000
3. Understand redemption rules and penalties. In Georgia, buyers must wait a year to receive the title of a property, allowing the previous owner to reclaim it by paying the tax debt plus a 20% fee. In Texas, the waiting period is just six months, during which investors can use the property but don’t gain full ownership until the period ends. These rules affect potential profits and risks. A shorter wait means quicker ownership, while a longer wait could lead to higher earnings if the previous owner repays.
4. Be consistent and persistent. We believe that to be successful, we have to go to auctions regularly. We need to check out property lists and make our bids. Winning at tax-deed sales isn’t easy. We might lose at a few auctions before we find a good property. Staying persistent and being ready will help us in the long run. When we keep trying, we boost our chances of winning.
   

Choose the Right Tax‑Deed Market

Example Markets

Below are the markets Josh discussed.

• Houston, Texas: High rent, low purchase price and frequent tax‑deed auctions. Texas is a redeemable‑deed state; the previous owner has six months to redeem the property. Investors can collect rent and manage the property during that time.
  
• Philadelphia, Pennsylvania: Monthly tax‑deed auctions with a large number of properties. Josh’s team has bought homes here for US$ 5,000–10,000 and installed tenants. Inventory may shrink as competition increases.
  
• Southern Florida: Monthly tax‑deed auctions but limited inventory. Multiple counties within short driving distance allow investors to attend several auctions. Florida uses a bid‑down interest method.
  
• Georgia: Plenty of properties at auction, but buyers must wait one year to receive a deed and face a 20 % redemption penalty. Suitable for investors willing to wait or who seek penalty returns.
  

Tips for New Investors

1. Educate yourself. Learn what tax liens and tax deeds are. They are different things. Also, find out about redemption periods. You can take classes or watch free videos to help you understand these topics better.
   
2. Start small. Begin with one or two properties to learn the process. Focus on lower‑priced properties that need minimal repairs.
   
3. Attend auctions before you bid. Watch how bidding works. Talk to people who know a lot about buying and selling property. This will help to see how homes and buildings are usually sold and what costs come with them. Get tips on what makes a good deal. Learn how to avoid mistakes and get a better feel for the market.
   
4. Perform due diligence. Take a look at the property if you can. Inspect for any damage and verify that there are no outstanding liens. Verify the zoning rules. Also, see if anyone lives there. If they do, know the eviction laws.
   
5. Have a budget and an exit strategy. Decide whether you want to sell, rent, or keep the property. Think about how much it will cost to fix things, the taxes you need to pay, and any risks of losing the property. Don’t bid too high. You can make money by buying below the market price.
   

Frequently Asked Questions

Final Thoughts

Investing in tax deeds can be a good way to make money if you choose your markets carefully and don’t give up. Start by learning what tax liens and tax deeds are. Look for places where rents are high, prices are low, and there are lots of auctions. By going to auctions often and doing your research, you can slowly build a collection of properties that can grow over time.