September 4 - Every February Maricopa County holds an auction to sell off unpaid property tax debts to the bidder who will accept the lowest interest rate. The maximum interest allowed by law is 16% and the average interest each year gives us some idea of the willingness of investors to pay off the property tax debt on behalf of the delinquent property owner. The County Treasurer publishes statistics about the annual state of affairs in the world of tax liens. Here is the current table:
If a tax lien auction fails to generate a bid, the parcel is "struck to state" and become a state owned lien. When the 4 year time period expires and the Certificate of Purchase has not been redeemed, a treasurers deed is generated which transfers ownership to the State of Arizona. The state does not actually pay the back taxes but they are abated instead.
We can see that investors were not excited to buy the glut of tax liens being sold off in 2011, since the winning interest rate bid hit a high point of 10.79% and a record number of parcels were struck to state. These parcels are now being transferred to state ownership in record numbers and we are seeing a lot Treasurer's Deeds recorded in recent months. In contrast the February 2015 auction was very popular with the average interest rate the lowest ever at 3.84%.