The 3 biggest differences with land/new construction deals from flipping.

[Zach Matson]

I transitioned from flipping to new construction basically at the beginning of the pandemic. The 3 biggest differences in land/construction deals vs flipping are:

1. Time - Unentitled land takes 2.5- 3 years to go full cycle from contract to exit. Mostly because of... difference #2... 

2. Working with government entities for approvals. Surveys, plats, engineering, working with every single P&Z department plus the highway district, health district, irrigation district, etc. Multiple cycles of redlines and corrections to plans based on all the reviews. 

3. Financing. You need a larger percentage down payment, or pay in cash, and you need to be able to carry that for the full cycle from contract to close. This is perhaps the highest bar for a lot of people. 

There is a reason why a lot of people don't transition to new construction from flipping, and that's because it's complicated and it takes time. But we need housing and we need to lower the bar for people to get into new construction. I have been seeing more education on land deals, so hopefully that translates into more people jumping in. I personally am planning on scaling this year as it's looking like it's going to be a great time to buy some land deals!