Cash Flow With Joe

Take emotion out of it

by | Mar 20, 2017 | Buying | 0 comments

I was talking to an investor recently about a property tax lien sale. These take place when counties auction off the tax liens that have accumulated due to unpaid property taxes. It’s a good way for local government to recoup some of their lost funds.


For investors, it’s a great opportunity. If you know what you’re doing at the tax sale, you’ll get either a guaranteed 18 percent return on investment or end up with a property. With banks accounts offering less than one percent interest, a worst case scenario of 18 percent ain’t bad.


The investor I was talking to said he’d never participated in the sale but that he’d watched the last one as he was waiting for the foreclosure auction. He said he couldn’t believe how many people showed up and how emotional they could get.


He told a story about two guys who got carried away. They were bidding on a lien where the property lay between their two personal residences. Most of the time, a tax lien is only two or three years old, so the opening bid is often only a few thousand dollars. He said these guys started at $5,000 and ended, faces all red with visibly bulging forehead veins, at $40,000.


I’ve seen things like this happen at auction before. Because of that, I’m very careful to leave my emotions at home and rely only on my predetermined numbers when I head to the courthouse each month.


Something happened this week that reminded me to keep my emotions in check no matter where I’m going for the deal. The owner of a house in Dalton contacted me and said he had a property he needed to sale quickly. He said he owned it free and clear but that it needed some work. That’s music to my ears.


When I went to meet with the seller and inspect the house, I found “needing some work” was an understatement. In one bathroom the tub was sinking into the floor. In the other bathroom I could see daylight under the toilet. The subfloor was rotted under both doors, there was trash everywhere and don’t get me started on what I saw with the plumbing.



The reason the owner wanted to sell was because the previous tenant had trashed the house, and he didn’t have the money to fix it. He was also undergoing cancer treatments which were going to be canceled if he didn’t pay some of his bills by the end of the week. He was hoping to sell this house for enough to bring him current on his medical bills.


My heart went out to him. Because of the property condition, I told him I’d have to talk the purchase over with my wife. At home I showed Ashley a video. When she saw its condition, she gave me an emphatic “No!”


Would you believe I tried to haggle with her? I started listing all kinds of reasons why this house might just be a deal. But I hadn’t told Ashley the guy had cancer. That kept her from being emotionally affected, allowing her to easily see this was a bad idea. Flat out, it would cost too much in an area where the rents wouldn’t support it.



Needless to say, we didn’t do the deal. I’m reminded of what my main teacher Bill Cook told me, “Some of the best deals are the ones you never do.”


There’s a second part to this story. The next day I went to look at a house with a similar seller situation. We bought it for just a little bit more than we would’ve paid for the other property. The difference was this one was in way better shape, the rents would support it and I’d relearned to take my emotions out of it.


Joe and Ashley English buy houses and mobile homes in Northwest Georgia. For more information or to ask a question, go to or call Joe at 678-986-6813.


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