Raw Land Investing - Start of a Discussion

[Thomas Houpt]

Who here does raw (vacant) land investing? What success have you seen from it? How long have you been doing it for? How did you get into it? What resources did you use to learn about this strategy?

[Henry Clark]

Unintentional.  Two different approaches.

The property we live on we bought back in 1993. Thus a buy and hold.  Although we bought this 48 acres for our home, we intentionally bought this land because it was near our small town and next to a 4 lane highway to the major city.  Thus we get to live in the country.  Get to a large market area for jobs and entertainment in 20 minutes.  And if we are out of milk, its just 2 minutes away.  Our Son only had a 2 minute drive to school.  We have now made a subdivision out of this 49 and another 31 we bought adjoining us about 15 years ago and make a "country" subdivision.  See "Journeys End" Glenwood, Iowa.  Very cheap land, now selling for $100,000 for 2 acre lots.

On our latest self storage location we bought an 8 acre farm lot in a larger town.  Grabbed a chainsaw and started cutting trees down, about 3 acres, and pulling stumps.  We only need part of this land so we built the storage away from the 4 lane road up front.  This is in case we build contractor buildings up front to rent.  We had to subdivide these two pieces since the SBA would not finance Subcontractor rental units.  Original land cost $200,000 for the 8 acres.  The front 4 acres we divided off 27 months later appraised at $580,000 for the bank.  We cleared the land.  Put in water and sewer lines to edge of property, put the rest of the property into commercial use with Self Storage.

If your near, but outside a small growing town.  Pick a property that has roads on more than one side.  On the right side of town, with other charm, trees, internet, easy highway access, pond/lake view, etc.  Then do a subdivision.  Not the traditional driveway down the middle.  This costs a fortune.  Just shared driveways for two houses along the road.

If your in town, find a junky commercial or industrial location with extra land and subdivide.