Flipping New Construction strategy

[Alfredo S.]

Hi. I am interested in flipping raw land, and I have some investor friends that recommended this strategies. But I'm having a hard time defining the process and calculating the numbers. So theres two ways I see this working. 

FIRST STRATEGY

1. Buy raw vacant in-fill land at market value

2. Adding value to the land by taking it through the pre-construction phase, meaning hiring an architect or engineer to draw up the plans and a mock up of the house, and getting the approvals and licenses to start construction

3. Selling the approved land for a profit to a buyer who is willing to take the new construction to completion

SECOND STRATEGY

1. Buy raw vacant in-fill land at market value

2. Adding value to the land by taking it through the pre-construction phase, meaning hiring an architect or engineer to draw up the plans and a mock up of the house, and getting the approvals and licenses to start construction

3. Selling the New Construction to a home buyer for the finished price. Getting 25% down and using that money to pay the builder. When the home is built pocketing difference in profit. 

FOR EXAMPLE: Selling the New Construction for 300k, buying the land for 15k cash, spending $150k building cost, that's $165k total in expenses. Using the 75k deposit (25%) towards the expenses, and paying the rest of the cost using investor money or hard money loan. Banking $135k in profit. 

I am new to the game but I'm very serious and I have a real estate license. Any advice will be greatly appreciated. 

[Bruce Woodruff]

What @Chris Seveney said. This could be very risky for you. I would only do a build like this as a 'Cost Plus', as opposed to a Fixed Cost build.....