5 Acres in Lakebay Wa

[Shane M Plummer]

Investment Info:

Other fix & flip investment.

Purchase price: $20,000
Cash invested: $20,000
Sale price: $85,000

While searching for land that had timber. I came across 5 acres that had 3 acres of nice timber. I reached out to the owner, who gave me permission to walk it. The property was full of garbage, old cars, campers and boat/ trailers. He told me he had inherited the property from his dad and was using it to "make tiny houses". He said he would let it go for $45k. I decided that was too high at the time but asked him to call me if he would take less. He called me sometime later. Covid had just hit, and his wife had lost her job. He said that if I could give him 30k cash he would take it. At the time we had only 25k cash available. I offered him 20k. He refused, but a few days later said he would take it.

What made you interested in investing in this type of deal?

Originally, we were told these 5 acres was land locked. After doing some research we realized the property had a recorded easement that had never been developed. The profit from the timber and small profit from selling the used vehicles and trailer.

How did you find this deal and how did you negotiate it?

Searching the Local GIS and county websites. Google Earth. I contacted the owner directly.

How did you finance this deal?

Cash

How did you add value to the deal?

Cut in the easement road, cleared overgrown timber to lighten up the previously dark property. Septic design. Sold cars, boats and trailers. Reached out to the real estate agent who was selling the 2 adjoining parcels. Asked him to tell any potential buyers that I would share a well with them. The real estate agent relayed my information to a Trust who bought the adjoining parcel as an investment. The trust reached out to me and eventually asked to purchase the 5 acers.

What was the outcome?

Sold for 85k with 15k in timber profit.

Lessons learned? Challenges?

Networking helps, having cash when deals come up.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

No