Washington DC Tax Sale

The Washington DC government’s Office of Tax and Revenue has rescheduled its property tax sale for November 30th. Interested parties can register from Nov. 23rd – 25th.

What is a tax sale auction?

The auction is not in fact a sale, as no property changes hands on that date. Auction bidders win a claim against the property, and may eventually begin a foreclosure process, for which they’d have to pay off the tax lien on the property to the Washington DC government. But the original owners retain the property in the short term and have a right to pay off the bidder and clear the title to their home.

What happens if you win the auction?

Not many homeowners will lose their homes, most pay up. However, some auction bidders often come away with the right to charge penalties on the property to the owners to make back some revenue in the form of interest. Of course ultimately, the big hope is that some owners cannot payoff the bidder and will have to let their home go to foreclosure, and the bidder ends up owing the house simply for payment of the back taxes.

Where is the auction?

The auction will be held at 941 N. Capitol Street. It will be an auction of tax liens on over 5,000 residential and commercial properties in the District that have unpaid property taxes.

Ending up with a property is very rare. Not many people let their home go for simply not paying property taxes. I have heard it said, “If you’re interested in the tax lien sale, go for the interest rates, not for the properties. I’ve heard that most property owners pay the taxes.”