What would be the advantage of purchasing that early?

There is a lot of competition what with all the hourly apartment spammers, though.

I also heard yesterday from a large reo lister that investor competition is dropping off.

Since there are no tax advantages to the IRA, you lose a lot of the benefits to owning real estate.

There's many more competitive offers out there.

There is still much supply and competition with cheap money, so I expect a lower cost basis to negatively impact rental rates.The middle-class is also in a transition, but has been in higher demand recently probably due to post-foreclosure tenants looking to rent.

The reason why I am asking this is that recently I am seeing a lot of articles that investors (foreingers , funds etc) are jumping into the US RE market which is suggesting to me that there is a lot of competition hence lower return and more riskb.

From that description, it's also not impossible that the gentlemen you describe was not simply interested in deterring you from attending future auctions.Think of who has more of an interest in the actions taken, a "bank representative" who has completely wasted his time at the auction, or your competition trying to eliminate you.Also, I'm curious as to why you say it was clearly worth more than $500K when no one bid on it.

Now it seems like they are truly trying to take advantage of my generousity.

Also, how competitive are the LA county Tax deed auctions?