I say wholeselling land because I think the market is great for that right now. This way of doing business works just as well with houses.
As I want there to be valuable information here on my blog, I figured I’d share a pretty cool way of making big potential profits without having to risk too much money of your own.
The U.S. real estate market took a deep plunge after 2008. It then stayed down there in the mud for several years before things started selling again just a little while ago. The first thing to get attention was all the foreclosures, fixer uppers and investor deals. The bottom of the barrel if you will. After most of that scrap was bought up and the price for a wreck was doubled, more standard houses started selling. Prices have then gone up for them as well and as a result, new construction is starting to pop up.
Lots and land are now starting to get some minor attention for the first time since before the crash. I’m writing this post in the spring of 2018 and I believe today would be a good time to buy up cheap lots and land that the previous owners haven’t been able to off-load for the last 10 years. That gives you a powerful position in negotiations and you can make proper bargains. If you hold this land for a year or two and the market continues up a bit, you might very well double your investment.
However. There is a chance the market stops or starts going down instead. Owning land and lot’s during bad times is a poor investment. They usually don’t generate any cash flow, they will cost you money in taxes and they are almost impossible to sell. So what do you do?
A very successful real estate developer gave me a great tip that I think would work great in the market we are in right now. If you look around you will find sellers motivated enough to give you some good terms. The terms you should aim for is an option to buy. Tell them you want to have an option to buy their land or their lot for a year or two at an agreed price. Offer them a small down payment that they get to keep if you don’t buy it. That offer should cover all their costs of owning the land for the year you are talking about. If the market keeps going up, you can offload that same lot at a good profit, if not, you only lost a small downpayment.
