Howard County, Maryland Land Valuation

[Bryce Adams]

Hello BP community! I recently participated in the Howard county tax lien sale and have a property that I can now start the foreclosure process on. This property is land only and is zoned commercial. I have a title report from my lawyer, but it is somewhat confusing as the land has been subdivided (it started as 9 acres and is now 1.5) and has quite a few transactions - including to the county (I.e allowing the county to build a road). I am hoping to get a better idea of the value of the land to determine if it makes sense financially to start the foreclosure process (the two notices have been sent).  I am hoping the BP community would be able to point me in the right direction of someone who could help determine the value of this land. 

Thank you!

[Tom Gimer]

Perhaps @Ned Carey will chime in but IMO the valuation should have occurred prior to bidding. The tax certificate will expire, so if you never start the foreclosure process what was the point of purchasing the lien? Since the owner needs to pay your attorneys fees (essentially limited by statute, so can be estimated) in connection with a redemption, all of that math should be part of the planning. Also title to figure out if the land can even be used for a particular purpose.

But to answer your question regarding value, a decent metric is the current tax assessed value of the parcel:

https://sdat.dat.maryland.gov/RealProperty/Pages/default.asp...

Or you could pay for a broker price opinion..

[Bryce Adams]

Quote from @Tom Gimer:

Perhaps @Ned Carey will chime in but IMO the valuation should have occurred prior to bidding. The tax certificate will expire, so if you never start the foreclosure process what was the point of purchasing the lien? Since the owner needs to pay your attorneys fees (essentially limited by statute, so can be estimated) in connection with a redemption, all of that math should be part of the planning. Also title to figure out if the land can even be used for a particular purpose.

But to answer your question regarding value, a decent metric is the current tax assessed value of the parcel:

https://sdat.dat.maryland.gov/RealProperty/Pages/default.asp...

Or you could pay for a broker price opinion.

 Thank you for your reply, Tom. We used the tax assessed value to help determine the value of the land and subsequently our bid. Our goal was to foreclose and sell off the land if it wasn’t redeemed. However, once we received the title report, we started to question if we bid to high for the lien. 

I’ll look into getting a broker price opinion - thank you for that recommendation!

[Ned Carey]

@Tom Gimer thanks for the shout out

@Bryce Adams Tax assesed value is a terible way to base your bids. Tax assesments can be way off. That said you bid on the parcel described in the tax records. If you do a proper foreclosure and notify all parties a tax foreclosure can clear up an otherwise scrambled title. 

You need to find out exactly what you bid on. Land is very tough to estimate value do to it's valie is based on what you can do with it and how much demand there is for what ever is ultimately done with it.  Zoning and Environmental restrictions can greatly effect the value of a property. 

Who is the attorney doing the foreclosure? Is this someone who is famililar with tax sale foreclosures? Sometimes starting a forecosure is what motivates a seller to redeem the tax lien. However if the owner does not redeem you'd better be sure the property is worth your bid and expenses. 

I have been doing tax sale in Marytland for 20 years. Feel free to tag me with a follow up question. 

[Chris Seveney]

Quote from @Bryce Adams:

Hello BP community! I recently participated in the Howard county tax lien sale and have a property that I can now start the foreclosure process on. This property is land only and is zoned commercial. I have a title report from my lawyer, but it is somewhat confusing as the land has been subdivided (it started as 9 acres and is now 1.5) and has quite a few transactions - including to the county (I.e allowing the county to build a road). I am hoping to get a better idea of the value of the land to determine if it makes sense financially to start the foreclosure process (the two notices have been sent).  I am hoping the BP community would be able to point me in the right direction of someone who could help determine the value of this land. 

Thank you!

 you will need to look at the APN of the property and line it up with what you actaully bought. as mentioned the tax assessed value is not an indicator of value. the land could be a utility easement, used for stormwater management etc. It could be unbuildable.

did you go look at the property at all, or did you bid blindly based on the assessed value and threw a low bid at it.