Nearly 1,000 properties with unpaid Beaufort County taxes were auctioned to the highest bidder Monday during the annual delinquent-tax sale.
The event, at the Charles Lind Brown Activity Center in Beaufort, drew more than 150 bidders and spectators, many armed with iPads, laptop computers or homemade cheat sheets.
Although some prospective buyers vied for real estate steals or wanted to clear debts on inherited property, others came with a different strategy.
"I am in it for the interest penalty you are going to get," said Bryan Hughes of Hilton Head Island.
Although delinquent taxpayers have a year to reclaim their property by paying off unpaid taxes and any other fees owed to the county, they must also pay a 3 percent interest rate per quarter.
If properties are reclaimed, the high-bidders get their money back, plus the interest. If a property is not reclaimed, the former owner receives whatever money remains from the sale after taxes and fees are deducted.
"The strategy is to spend as much money as I can," Hughes said. "Twelve percent of $100,000 is a whole lot less than 12 percent of $1 million."
With terms like those, Hughes said, hedge-fund representatives and others in the financial sector will travel the country seeking tax sales. The parking lot at the Brown center was packed Monday with rental cars and out-of-state license plates.
Last year, 1,103 properties were auctioned, raising about $26 million. But in a given year, the county expects only 15 percent of the properties sold at auction to transfer to winning bidders.
County Treasurer Doug Henderson said he wouldn't know until later in the week how much money was raised through the sale or how many properties were sold. Buyers have until today to hand over certified funds for any properties they won during the auction.
Al Mack, president of the Willow Point Homeowners Association in Port Royal, hoped to buy land in his subdivision still owned by its developer. Mack said he wanted to make sure the land, which includes walkways and a shared dock, didn't go to a buyer who would restrict neighborhood access.
"We're trying to protect our interest," he said.
Like last year, the auction was conducted by Darron Meares of Greenville-based Meares Auctions.
Although most properties sold for $5,000 or less, others drew heavy interest and quickly surpassed $100,000 as bidders kept their yellow placards raised. Meares started bidding at the amount owed in taxes but quickly raised his calls in $5,000 and $10,000 increments with the most popular properties.
A commercial property on Robert Smalls Parkway near Beaufort Liquidation was among the highest individual properties sold, fetching more than $500,000. A one-acre lot in Sheldon was among the lowest, at $391.
"I think it's going great," Henderson said of the sale. "It's probably taking a little longer than I would like, but that's because there has been a lot of active bidding."
- Time running out to pay overdue county taxes, Sept. 21, 2012
- County tax sale yields more than $26 million, Oct. 7, 2011