Florida's Over the Counter
Why is it so lean right now?
It’s a question that many investors are asking as they notice the Over-the-Counter (OTC) Florida tax liens, which are typically a goldmine with a guaranteed 18% return, seem to be in short supply. At first glance, it may seem like the well has run dry, but rest assured, this is just a seasonal dip. The OTC market in Florida is always lean during certain times of the year, but come June, the inventory will be overflowing with opportunities.
Right now, what’s available may consist of small, unbuildable parcels, easements, or right-of-ways—properties that might not seem attractive at first. While these may seem like minor offerings, some could still present profitable opportunities depending on an investor’s strategy. The key here is patience and a clear exit strategy. It's vital to always play the scenario through to the end and assume that you’ll acquire the property, even though the odds may still be low. These may not be the big, glamorous deals investors dream of, but they can still be worthwhile when approached with the right mindset and strategy.
The process in Florida kicks off each year with the May Bid Down Auction, where every county in the state gets its first crack at collecting on the prior year's delinquent taxes. The volume of properties available at this auction is nothing short of staggering—over 63 counties are online, offering a massive selection of parcels for bidding. For those unfamiliar with how these auctions work, the excitement doesn’t stop at the 18% guaranteed return. Investors can also capitalize on the 5% penalty assessed during the bid down auction, making this an even more attractive opportunity.
Once the dust settles and the counties tally the results of the May auction, they move the leftover tax lien certificates to the Over-the-Counter (OTC) market, and this is when the real treasure hunt begins. It’s truly astonishing just how many no-brainer deals become available once June hits. For savvy investors, the OTC market after the auction is like a second chance to grab valuable properties at discounted prices—many of which could offer far more potential than they initially appear.
However, the key to success in this market is diligence. No matter how tempting these deals may seem, due diligence is non-negotiable. Investors should never rush into a purchase without thoroughly vetting the property and understanding its potential risks and rewards. In the world of tax lien investing, knowledge is power, and the most successful investors are those who take the time to research, analyze, and prepare for each transaction carefully.
