Why Land/Lots are better than houses!!!
Hi, my name is Jonathan Haveles and I love land! I have flipped over 500 properties all over the US.
And let me say this: I love houses, I started out in the housing real estate industry.
However, I love Land and lots more!!
And here is the reason: With land and lots you can do almost the same as you can do with houses yet
you have almost none of the hassles that come with houses. Plus, contrary to what many people say you
can make land cash flow – MASSIVELY.
So What Can You Do With Land...
First of all, there are lots of things you can do with land that you ALSO can do with houses.
You can flip land/lots just like you can flip houses, including wholesaling, retailing, assigning, and doing
double closings, you can lease land, sell land, keep land for long-term appreciation… just to mention a
few things you can do with land, and the best part is that you can do most with very LITTLE competition.
In the current market climate with everyone chasing houses this little competition piece is certainly a
BIG factor that even experienced house flippers are starting to look at lots and land more and more.
Let’s talk about Wholesaling a bit. The beautiful thing about land and lots is that with the technique I will
show you at the REIA in September, anyone can find properties and lots and put them under contract
for anywhere between 5% and 25% of market value (so a 75%-95% discount) – I know that sounds hard
to believe but I have done over 500 land deals using this technique alone – and when you lock up
properties for so cheap you can easily sell them at wholesale prices (like 50% of market value for a
property you bought for 10 cents on the dollar) and make a nice profit (like increasing your investment
5-fold) on these properties. All without rehabbing, getting permits, talking to contractors, or even
inspecting the properties, because there are no roofs, bathrooms, plumbing, foundation issues, or
anything like that on land. It’s AWESOME!!
Of course, you can also retail the properties at full market value, particularly if the properties are a few
lots in a nice development right in town. The market is on fire and builders and developers can’t find
properties fast enough to build on. That means even if you are a house investor right now and you are
struggling to find deals, but have been walking past land and lots for years, it might be time to take a
second look. More of course about that at the August meeting.
That was just one example of what you can do with lots and land.
But in addition to things that are similar, there are also a few techniques that ONLY work with Land and
which you can’t do with most residential houses. These are things like “subdividing a lot”,
rezoning all or parts of a property even in a developed area”, and of course “building on it”. These are all
things that can increase a lot way more than a high involvement, high stress, high headache, high hassle
rehab project can do to a property. Split a lot into 5 even in a rural area and you might have doubled or
tripled the value of the combined properties. All without putting a nail into it or even getting a surveyor
to the property.
But That’s Not The Best About Land Yet...
My favorite thing to do with land is to make it Cash flow. Yes, you heard that right again. It also happens
to be the fastest way you can sell a property in any market, whether the market is up or down.
What I am talking about of course is Seller financing.
Seller financing, is in simple words, the process of allowing a buyer who perhaps doesn’t have all the
cash to buy the property outright, to pay a down payment and pay the rest of the purchase price over 3-
15 years (depending on how much they need to pay off) in monthly installments.
Of course, you can also do this with houses and there is a big market for that, but it’s just again easier
and simpler to do this for land and lots. The main reason this is simpler with Land and lots because land
and lots, as several attorneys have confirmed for me, is outside of Dodd Frank (Dodd Frank mainly
covers Residential Property aka houses), and therefore all those crazy Dodd Frank rules concerning
Seller financing, where they force you to jump through hoops, check buyers on their ability to afford the
property… just don’t apply.
I am very much looking forward to highlighting one of the highest profit, lowest competition, and
simplest to implement real estate techniques in the current market place (and it works everywhere –
To Your Success,