Last Updated on June 16, 2026
New York Tax Deeds: This article explains how the process works and what you need to know. The market for New York Tax Deeds offers unique opportunities for investors. Not every time, not guaranteed, but the opportunity is real, and it has been for over 200 years.
Is it really possible to buy a house in New York for as little as $20,000, a house that could be worth $50,000, $60,000, or even $100,000? Yes, through New York tax deeds, it can happen.
Here is everything you need to know before you bid on your first property.
Table of contents
What Are New York Tax Deeds?
A tax deed occurs when a homeowner stops paying property taxes for 3 to 5 years. The government steps in, says “pay up, or we’re selling it,” and puts the property up for auction. The opening bid is just the back taxes plus legal fees, not market value.
That gap between the opening bid and what the home is actually worth? That is where investors make money.
Does New York Do Tax Deeds, Tax Liens, or Both?
New York does both, and that is actually a big advantage.
| Type | How It Works | Risk Level | Best For |
| Tax Deed | You buy the property outright at auction | Medium | Investors who want the asset now |
| Tax Lien | You pay the owner’s taxes; they owe you interest | Lower | Investors who want passive returns |
- Most counties outside New York City sell tax deeds after foreclosure.
- New York City and some larger areas sell tax liens, with interest rates ranging from 6% to 18%.
- Some counties do both, so always check your specific county.
Can You Really Get a $200,000 House for $20,000?
Sometimes, yes. The opening bid at a tax deed auction is the back taxes plus fees, not the home’s value. If a bank is slow to act, disorganized, or the balance is too low to matter, a mortgage on a $500,000 home can legally disappear at auction.
That said, popular counties get competitive. Properties in Manhattan, Brooklyn, or Long Island can get bid up to or past market value fast.
The sweet spot: smaller, more rural counties where institutional investors aren’t looking.
Do New York Tax Deeds Wipe Out the Mortgage?
Yes, if the mortgage holder was properly notified, the mortgage is legally erased (“extinguished”) when the county resells the property through the court process. It is judicial, which means it goes through court and is legally binding.
What does NOT get wiped out:
- County code enforcement violations
- Grass-cutting or property maintenance liens placed by the city
- Some municipal liens
- IRS liens (these typically survive only about 90 days, so less of a concern)
Always check for surviving liens before you bid.
Best Counties for Beginners in New York
| County | Why It Works |
| St. Lawrence | 75+ parcels, low competition, affordable entry |
| Onondaga (Syracuse area) | Strong resale, mix of land and houses |
| Fulton | Online auction in June, lower competition |
| Albany | Good deals available, but watch for junk |
Avoid Manhattan, Brooklyn, and Long Island if you are just starting. More competition = fewer deals.
Key Takeaways
- You can buy houses in New York for as low as $20,000 through New York tax deeds, which occur when property owners fail to pay taxes.
- Tax deeds allow you to acquire property outright, while tax liens let you earn interest by paying the owner’s back taxes.
- The best opportunities often lie in smaller, rural counties, as popular areas like Manhattan have heavy competition.
- Do extensive research and ensure you check for liens before bidding; it’s crucial to understand county-specific rules.
- Although tax deeds are legitimate, many avoid them due to a lack of understanding, presenting opportunities for informed investors.
How to Get Started: Step-by-Step
- Step 1:
Pick one or two counties max. Learn their rules cold before looking elsewhere.
- Step 2:
Find the auction. Most New York counties hold tax deed auctions once per year. Common online platforms include Bid4Assets and Absolute Auctions & Realty (AAR / NYS Auctions). You can also call the county directly.
- Step 3:
Build your auction calendar. Start planning 60 days out. Watch the list closely two weeks before the auction.
- Step 4:
Drive the property. Pull it up on Google Street View first. Then, before the auction, hire someone locally (Fiverr, TaskRabbit, Facebook wholesaling groups) to get real-time photos. Never bid based on old Street View images alone.
- Step 5:
Check title and liens. Pull the chain of title. Look for code violations by searching the city name, not just the county (e.g., “Buffalo New York code violations”). Check for demolition orders or condemnation notices.
- Step 6:
Bid with a number, not emotion. Know your max before the auction starts. If you win, you must pay, backing out can get you banned from future sales.
- Step 7:
After you win: Pay the county, get your deed, secure the property, get vacant property insurance, and decide your plan: flip, rent, or hold.
How Much Money Do You Need?
| Strategy | Starting Range |
| Tax Liens | A few thousand dollars |
| Tax Deeds (rural/affordable counties) | $15,000 – $30,000 |
| Tax Deeds (higher ARV markets) | $30,000 – $50,000+ |
If you have $10,000 to $50,000 sitting in a savings account or CD earning 3–5%, a tax lien at 18% or a deed at 40–60% below market value can change the math on your retirement.
FAQ: New York Tax Deeds
No, you generally do not need one to bid. But if you are spending $50,000 or more, it is worth talking to an attorney to help clear the title after you win.
That is the risk, and the reason you drive properties before bidding. Do not skip this step. Some “houses” on the list have burned down, flooded, or been demolished since the last Street View update.
Yes. Many New York counties now use online platforms. You can participate without ever stepping foot in New York.
You own the property the day you win. Selling it can take weeks to a couple of months depending on whether you clear the title for traditional financing.
For most deed sales, the redemption period happens before the auction, so once you win, the prior owner’s right to reclaim is already gone. For tax lien purchases, expect roughly a 2-year redemption period (varies by county).
Often, the prior owner is no longer around. If they are, it’s helpful to inform them about tax overages, the difference between the home’s sale price and the back taxes owed, which they can claim from the county. Many miss out on this money because they aren’t informed.
Tax deeds are not a scam; they have existed for 200+ years. The reason everyone is not doing it: most people do not know the rules, and the rules vary county by county. That confusion is actually what creates opportunity for people who do learn them.
Bottom Line
New York tax deeds are real. The deals are real. So are the landmines, code violations, junk properties, and competitive bidding in the wrong counties. The difference between people who profit and people who lose money almost always comes down to one thing: doing the homework before the auction, not after.
Start small. Learn one county. Drive the properties. Check the title. And treat it like a skill, because it is one.
