Small Town Real Estate

[James Mann]

So Arkansas has a lot of rural communities and for the most part the market doesn't move much in these areas. When people purchase homes they tend to live in them for basically forever. Markets just stay stagnate. As I was visiting my family this week I passed through a rural community and there were homes for sale every where. None of which were advertised online like on realtor.com, Zillow, Trulia, or anything. So I was very confused. Turns out since it is on a lake it is a retirement community. So every few years or so multiple houses go up for sale and they sit on the market forever and have a difficult time selling. So this got me thinking about all the potential... 

What is stopping someone from coming in and buying up all of these lake houses and flipping and remodeling them and reselling them or even renting them out for massive profit?

Am I crazy?!?! What am I missing? Whats stopping someone from owning practically the entire town? 

Also there is a website in AR that you can purchase land from and all you basically do is pay the back owed taxes on the lot. You can't develop the land for 2 years but after that its yours. So you are able to purchase plots of land for very cheap and they are everywhere in this town! 

[Dustin Davis]

@Susan H. ... Sounds a LOT like Holiday Island or Eureka Springs (same thing essentially). It's the only spot in Arkansas that has good schools close to Branson but doesn't sound like @James Mann wants to share the said location. I grew up in Eureka and I can speak to the reasons I won't invest in either of towns at least right now. 

1. No one who lives there can afford or would pay for a rehabbed house.

There's a reason there a ton of houses for sale, price too high? maybe, wages to low? (read chicken plant) maybe, lack of decent jobs? probably. 

2. It's a "luxury" place to live or visit. When the economy goes south so does the town and all the outside money coming in. We saw this happen with the last downturn, talk about property value fluctuations. 

3. Laborers have a different mindset... They are more craftsmen (especially in Eureka) than your big city throw it together folks, this also translates into longer rehabs and higher $$$ per sq ft. 

4. The good ole boy network still runs deep in rural communities... As an "outsider" trying to capitalize on local folks and invading on Jim Bobs rental/housing turf your going to run into walls left and right on finishing your project.  

5. It doesn't have the same "perfect vacation spot" setting as somewhere that's half an hour from a major city or airport which seems to have become a prerequisite for vacation spots. 

Same argument can be made for towns like Red River, NM where housing stock hasn't generally changed since the 1980s for all the same reasons above.

I could go on but don't have the energy. If this truly is a diamond in the rough, go for it! I would love to see you make a million and would be the first person to help if you can prove the model. Until then, I'm going to stick to what I know works.