Exchange of Puerto Rico House for 2 lots in (newco) Lake City, FL 32025

[Luis Montanez]

Hello friends from BP,

I am hoping to get feedback from someone that is familiar with an area called Newco in Lake City, Florida zipcode 32025.

I am cooking this deal to exchange one of my investment properties in Puerto Rico (appraised at $60k rental income at $400 per month), with 2 vacant lots in Lake City, Florida (in the process of appraisal but estimated value for each is $12k to $15k).

I will finance the difference $60k of my house and the 2 lots, so the buyer has agreed that if I was to do owners finance for $30k ($60k - $30k for 2 lots) the terms for his payment will be around $362 per month for 8 years (that includes a 4% annual interest rate).

What concerns me the most (and the main question of this post) is getting your input for the best exit strategy for the vacant land. After doing some research on the area I found the following:

1. Most home sold are 3/2 between $40k and $84k

2. Vacancy rate is 17%

3. middle to low class income area

4. mostly retired people.

Based on this information my options are:

A. to purchase 2 manufactured 3/2 homes (one for each lot at a cost of $39k each) to re-sale for $80k each (after selling and other cost) I estimated a $40k profit. the negative part of this option is that based on my research, manufactured homes may not sale for that high in this area.

B. to purchase 2 mobile homes for $5k to $10k each and resale at cost just to recuperate the $30k of the land, cost of Mobil homes and any other cost.

C. will be to do option A but to rent each for $500 to $600 per month based on what I can get for Section 8 in that area.

Please let me know what you think or if you will consider another option.

Additional facts:

1. this will not be a 1031 or like kind exchange (based on IRS info)

2. I live in Georgia, so managing my hoses in Puerto Rico have become a challenge.

3. I have never done any construction so just constructing houses is over my head.

thanks