I have been a highly successful real estate investor for more than 18 years and have discovered seven reasons why flipping land is better than flipping houses.
I have been a highly successful real estate investor for more than 18 years and have discovered seven reasons why flipping land is better than flipping houses.
If you are familiar with the Land Profit Generator family, you will know that we are a community of highly successful real estate investors. What sets us apart is that we have discovered a gap in the real estate market far superior to traditional house flipping. Our secret, learned through trial and error by my wife, Michelle Bosch, and I, is that FLIPPING LAND is better than flipping houses.
In this episode of the Forever Cash Podcast, I take you through the seven powerful reasons that LAND is a superior asset class for real estate investors that want to make consistent active and passive income through real estate investing.
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Why Flipping Land Is Better Than Flipping Houses
Investing in real estate as a trusted way to build meaningful wealth is well established. The problem is that traditional house flipping is highly competitive and expensive, requiring a lot of time and energy to succeed.
Fortunately, there is a way to build your wealth as a real estate investor without dealing with all the complications inherent in the house-flipping world.
There are seven powerful reasons why land flipping is better than flipping houses, especially if you are looking to build lasting and meaningful wealth.
1. Land flipping provides a higher return on investment
As professional land flippers over the past 18 years, Michelle Bosch and I have enjoyed ROIs of anywhere between 100% – 2000% on land lots that we have bought and sold. You are unlikely to achieve ROIs anywhere near this level when you are flipping houses.
When wholesaling undeveloped land, you don’t have to deal with any of the overheads that traditional house flippers have to account for when flipping a home. No contractors, home improvements, or mortgage costs need to be worked into the deal. In addition, people who own land lots they are not using are far more willing to let their land for cents on the dollar. With far lower acquisition costs, there is a lot more room to make a profit on a raw land deal.
1. Easy Seller Lead Generation
One of the most remarkable reasons flipping land is better than flipping houses is that it’s a blue ocean market. In other words, there is a whole lot of land across the USA, and plenty of potential sellers do not want the lots they own. There are always a lot of people looking for land to develop and enjoy. However, there are only about 1000 professional land flippers active across the USA. As a result, the is a lot of supply and a lot of demand, but very few investors. Our Land Profit Coaching students are very successful at taking advantage of this opportunity.
2. You don’t have to raise a lot of capital to flip land
When buying and selling homes for profit, the first obstacle you need to overcome is raising capital to do the deal. Fortunately, this is not a problem for land flippers. Land is a lot more affordable in comparison to houses. You can pick up a lot for just a few hundred dollars. As a result, there is no need to finance your purchases with a mortgage or through private funding. In addition, you can use the double close method, which allows you to get a property under contract and find a buyer. Once you have a buyer, you can use their money to pay the seller and keep the profits. Find out more about double closing on land lots HERE.
3. Land is a recession-proof asset
In 2008, thousands of real estate investors went bankrupt when the real estate market crashed. During this time, Michelle and I continued to buy and sell vacant land lots, creating both active and passive income, forming the foundation of the real estate empire we control today.
You must be wondering why we were spared the real estate crisis. The answer is that only about 10% of the lots we buy and sell go to property developers. The vast majority of lots are bought by private individuals with the disposable income to purchase land regardless of what is happening in the market. Land deals are not funded by the bank and therefore are not affected by the interest rate. As a result, land investing is recession-proof!
4. You don’t have to use your own money when flipping land
One of the most significant drawbacks to flipping houses for profit is the risk of financing a second or third home or sinking all of your savings into the investment. One of the best things about flipping land is that you don’t have to buy the property before finding a seller! We call this the double close method. Once you have found a willing seller, you put the property under contract for a specified period. You are then able to market the property and secure a buyer. Once the buyer accepts your offer, you use their money to pay off your seller, and you get to keep the difference.
5. Create passive income with land
One of the greatest myths in real estate investing is that you can’t generate passive income from land lots. However, when you use the Land Profit Generator Seller Financing deal structure, you can create consistent passive income from your deals.
Seller financing is one of our favorite ways of generating wealth with land. The key is to get the buyer to pay for your deal’s costs with a down payment. Once the downpayment is made, you can contract with the buyer to pay for the property in installments over a fixed term. Learn more about flipping land with seller financing HERE.
1. No tenants, toilets, or termites
The final and most compelling reason why flipping land is better than flipping houses is that you can enjoy all of the benefits of being a successful real estate investor without having to deal with all the complications of houses.
Any house flipper will tell you there is nothing ‘passive’ about the income you generate when dealing with contractors in the fix and flip model. Rental units are no better, as tenants come with many other complications. When you are wholesaling land, you don’t have to do anything to the property before you hand it over to the buyer. While a residential deal can take months and sometimes years to yield a return, we have managed to buy lots one day and flip them the next, with MASSIVE ROIs.
If you would like to find out why flipping land is better than flipping houses firsthand, visit www.landcoaching.com to speak with one of our land experts today.
