First Tuesday Auction Strategy

Your First Tuesday strategy begins weeks before the auction, not the morning of the sale. Use Foreclosures Now to compile a running list of all NOSTS filings in your target counties 21+ days in advance. For each property, calculate your maximum bid using the ARV minus repair estimate minus profit target formula.

Never attend an auction planning to bid on a property you haven't researched. The in-person auction environment creates competitive pressure that can cause emotional overbidding on properties with unknown title issues or overestimated values.

Perform a preliminary title search on every property on your target list. The lien stack determines your true cost basis at auction — not just the winning bid, but all senior liens that survive the sale. IRS tax liens have a 120-day redemption right. Property tax delinquency must be paid to protect the investment. HOA liens may or may not survive depending on their priority.

A property with a $150,000 opening bid that also has $25,000 in delinquent property taxes and a $12,000 IRS lien has a true acquisition cost of $187,000 plus any repairs — significantly different from the bid amount.

Regular First Tuesday auction attendees form a recognizable community. Learn to identify the regular bidders in your target counties — observe their behavior, their focus areas, and their apparent bidding limits. In smaller counties, 3-5 active investors may control most of the auction activity. In Dallas and Harris County, competition can be much broader.

Understanding your competitive landscape helps calibrate your bidding strategy and identify which property types are less competitive.

Set your maximum bid before the auction and treat it as absolute. The most common auction mistake is winning a property at a price that eliminates your profit margin due to competitive pressure. Establish a pre-written bid sheet for each target property with your maximum bid clearly marked. When bidding exceeds that number, stop — immediately and without hesitation.

The deal you don't win at a bad price is not a loss. It is capital preserved for the next opportunity.