Buying Vacant Lots instead of Vacant Homes

[James Geraci]

I have an opportunity to buy vacant lots for 2 - 3k. Two are on a street i have a property and empty lot already on the street. The house and lots are in a low income part of a city. It is in an area where there are homes that either are in foreclosure or vacant rentals. Not a lot of qualified tenants, and not worth the carrying cost of a house that can be broken into and vandalized.

I could over time purchase the whole street, and work with the city to annex the lots into the city, currently in the county, but borders the city limits. Sit on them and work to redevelop the area down the road.

The property tax on the lots is like $200 / year, and couple hundred dollars a year per property to cut the lawns.

Do i acquire them?

Thanks

[Lisa Phillips]

@Jaren Barnes Funny, Jaren!

Hi @James Geraci

James, I am not expert at all in vacant lots, only a little bit more in seeing potential in low income neighborhoods.I can see a few things about this situation, but I leave the door open for anyone more knowledgeable in this to chime in, and for you to gladly take their advice!

My first instinct is to come up with a strategy that does not involve the city. Why get the city involve, when usually county seats are a lot less intrusive, have lower taxes, and less regulations on how you manage your land? And, even if you wanted the city to include it to get a part of the funds that can open up, you're leaving yourself open to being a pawn of a political system...If you trust in their good sense (and there are some cities that do have some sense left), you may be able to work out a deal and get some funds, but I don't like putting that much of my financial future in the hands of bureaucrats...at all.

However, if you're not going to wait on the city to annex them with city funds (which is in no way guaranteed to get a council member to listen to you...possible, but not guaranteed), Do you have some other ideas? Maybe putting a manufactured unit on the land for about 35-40k, maybe, if rents support a positive cash flow? Especially if its a state very familiar with a large portion of its residence living in manufactured homes, the rents that are possible won't dip that much because its not stick built.

Those are my ideas (again, not my forte), but I just wanted to throw out how I would be thinking about things. What do you think?