Buying Prior to Subdivision Approval

[Account Closed]

I wanted to ask about a certain strategy I read in a book called, "Real Estate Investing From A to Z," by William H. Pivar. The book was published in 1997 and is basically just a detailed look at the many possible ways to invest in real estate which includes various stories from investors.

One investor in this book sold his home for $100,000. Instead of buying a new home, he put down a housing deposit (most cases 10% of the cost of the home) for a home that had yet to be built in a growing subdivision. The deposit was refundable and demand high for his slot, so he would wait until building was almost complete, all competing lots had been sold, and then would sell his housing deposit to another home buyer for a substantial profit. He and his wife used all of the money they had received from selling their original home to buy and sell these slots, and in the end earned over half a million dollars (so the story explains).

My question is, is this possible? I can find no such available information online, and situations such as these are very applicable to the area I am in. I actually am currently in the process of putting a deposit down for a very popular new subdivision, and am contemplating buying out the remaining slots as well to flip for profit. Any thoughts, suggestions?