What I’m about to explain to you is something that very few real estate investors understand anything about, yet a handful of very wealthy people grew their wealth by investing in this type of real estate investment. We’re going to be talking about tax liens, tax deeds, or what a lot of counties call tax foreclosures. And that is blowing up right now and it has yet to make the mainstream media. So, a little history of people using tax liens to grow their wealth. Tax lien investing has been a wealth building strategy for over a century, offering investors a unique way to earn significant returns while helping municipalities recover unpaid taxes.

The opportunity arises when property owners fail to pay their property taxes and the government places a lien on the property. The lien is then auctioned off and investors can earn or acquire the property if the lien goes unpaid. And when we’re talking about earning, interest rates can go anywhere between 5% and 36% annually. So, you can see that this is an incredibly lucrative opportunity, but most people don’t do it because it’s shrouded in a lot of mystery. There are a handful of people that go out there and they teach courses on this and they charge thousands if not tens of thousands of dollars to teach people how to do this.

And that’s not what I want to do. The lesson of these tax liens and tax deed foreclosures traces the historical growth of tax lien investing. How economic downturns and inflationary pressures affect the volume of tax liens and why these factors present opportunities for savvy investors. So, let’s start with the early 20th century, right? The beginnings of this really big boom in this. This is between 1910 and 1930. At the start of the 20th century, the concept of selling tax liens to private investors gained traction as local government sought to recover unpaid taxes. This method allowed cities and counties to recover funds quickly while giving investors a secure investment backed by real estate.

A couple of points I want to hit is that tax lien sales were relatively low during prosperous times, but they saw moderate growth during local economic recessions. Investors at the time were primarily local buyers who understood the value of real estate and saw an opportunity in the tax liens as a steady secure investment. Well, then we come to the Great Depression of the 1930s. During the Great Depression, tax lien investing saw a significant rise as property owners struggled to meet obligations. A flood of tax liens became available, creating an environment where investors could pick up properties or high interest liens.

I’ve got a little bit of a chart we can throw up with different years and what happened during those times. And you can see as times got tough and as more and more people understood how this investment grew, the numbers grew, right? Well, why does this matter? In times of severe economic downturn, property owners are often unable to pay their taxes or what’s happening right now in the news, they don’t want to. There are news stories right now where people are saying, I’m just going to do a tax revolt. I’m not going to pay my property taxes because you’re charging me too much.

And what they don’t understand is there’s a very set up fair way because the counties don’t want people losing their homes because that’s the, you know, that’s a paycheck for them, right? But they need that money. So what happens is when they don’t pay these taxes, someone like you can come along, pay them for the person. And then there’s a process in which they must pay you back through the county. By the way, you don’t even have to meet them, talk to them, write them a letter or anything. This all goes to the county. They have to pay you back through the county plus your original investment plus any fees or penalties.

But this is getting worse and worse. And why it matters is because the more people, the more we dive into these recessions and the deeper the recessions are, the more opportunities they are. Now, let’s talk about the post-war boom from 1940s to 1950s. After World War II, economic prosperity led to a temporary decline in tax lien availability as more people could pay their taxes on time. However, tax lien investing still attracted investors looking for secure, high-yield investments. Many investors held liens as long-term income sources rather than acquiring properties. Now, some key points about that was that in this era, municipalities still used tax lien sales to conduct or collect unpaid taxes.

But opportunities were fewer compared to the Great Depression. Real estate values grew, making tax liens attractive even when the numbers of liens available was lower. Now, let’s go to the inflationary periods and the economic shocks of the 1970s and the 1980s. The 1970s and early 1980s brought soaring inflation and economic volatility, creating a spike in tax lien sales. Property owners faced rising costs and many were unable to meet their tax obligations, leading to a significant increase in tax liens. I’m going to throw up a chart of just some times during this, between 1970, watching the inflation rate, the number of tax lien sales, and moving into 1975 as inflation got worse, and then looking at 1980, inflation was maxing 13.5% and look at the amount of tax lien sales.

You could see as inflation rose, so did the opportunity in tax liens. Why does this matter? Inflation not only increases the cost of living, but also raises property tax assessments. As inflation pushed up the cost of living, more property owners defaulted on their taxes, making tax lien investing a lucrative opportunity for those with liquidity. Now, let’s go to what’s fresh in everybody’s mind, the housing crisis and the Great Recession of 2007 to 2010, when many of your parents, or quite frankly, some of you, lost your home because banks were making crazy loans. Well, the housing burst and the resulting Great Recession saw one of the largest increases in tax lien sales in US history.

Homeowners were defaulting on mortgages and taxes at alarming rates. During this period, tax lien investing was highly profitable for those who knew how to navigate the system. So let’s throw up a chart of that session. During the Great Recession, 2007, the number of lien sales were at 250,000, right? In 2009, the lien sales exploded to 450,000, and in 2010, we saw it hit 500,000. Well, why does this matter? Tax lien investors during the Great Recession could purchase liens at high interest rates, and many acquired valuable property for a fraction of the market value.

The demand for taxing auctions rose as traditional investments avenues became riskier. So that brings us to where we are today. Recent trend, COVID-19. 2020 to the present, the economic uncertainty caused by a COVID-19 pandemic has also contributed to an uptick in tax lien sales. While government relief programs helped temporarily, and when I mean temporarily, they held back a dam. They built a legal dam saying, counties, we’re going to help you with money. We’re going to give you some liquidity, but you’re not allowed to foreclose. You’re not allowed to have tax lien sales or tax deed auctions or tax foreclosure auctions.

And we’re going to hold you back. And in the last six months, the dam has started to break. County sheriffs, county officials have been going out in the media and saying, we can’t hold back. There’s over 1,000 properties here, 2,000 properties there. We need our money. And the government has stopped paying us. So we’ve got to put these on auction. So look, let’s throw up a chart just talking about the progression of taxing sales from 2020 when COVID-19 started. The inflation rate, remember what the government said? It’s only 1.2%. Look at recent tax liens in that year, 300,000.

Then the inflation rate increases to 4.7%. Remember that? Then it blew up, 320. Well, maybe not blew up less than 10%. But you see this increasing, right? Even when government agencies were saying, hey, hey, you can’t foreclose on these people. You cannot do the tax liens, right? But it was still going up. Then you come to 2023, the inflation rate, 8.5%. And the trend moved up to 400 tax liens. You can see where this is going. And I’m going to tell you what, in 2025, it’s going to blow your mind what that number is.

So the question is, what are you going to do? Are you going to sit on the sideline and watch as a ton of people dive in and start making a lot of money because even more properties are going to be hitting the market? And when I say a lot of people, please understand this. I’ve been a real estate investor and a real estate specialist since the year 2001. The amount of people that understand how to invest in this type of investment are about 5% of real estate investors. And out of that 5%, only 10% of that 5% really have ever done any tax lien or tax deed investing.

When we’re talking about tax lien, the percentages, the rate of return far outseeds stock market numbers and bonds investments. When you’re talking about tax deeds or tax foreclosure auctions, you are buying properties so much cheaper than if you were one of the most savvy bank foreclosure experts. You’re literally picking up properties for 10, 20, 30, 40 cents on the dollar. The question is, are you ready to do something about it? Now, like I said before, there are a lot of people that go out and charge people thousands of dollars for a course. I’m going to put a link down below to bundle the tax lien pro course and the tax foreclosure master course.

Together, for one price, the choice is yours. Do you want to do something about this or do you want to sit on the sidelines? It’s totally up to you. But I will tell you this, once you learn this information, you know it for life. And if you’re not ready today, I highly suggest you start watching the news because by the spring of 2025, it’s going to be right in your face how many of these counties are foreclosing on people because they either just didn’t want to pay or they couldn’t. And they didn’t have the reserves that they told the bank.

So the choice is up to you. I want to teach people how to make a lot of money this next year. I hope you’re one of them. That being said, the economic ninja is out. [tr:trw].

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