First Successful Land Flip

[Victor Noriega]

Hi BiggerPockets,

My wife and I would like to share our first successful land flip.  

The deal:

Purchased the property for $3000 paid the back taxes of $2200 and the closing costs were ~$700, so total investment was $5900.  I closed on the property on October 30, 2014.  Sold the property on January 6, 2015 for $15,000.  After closing costs, we made a profit of $7,600.

How we got this deal:

We used the method learned from Seth William's website, which we found after hearing the biggerpockets podcast.  The direct mail campaign targeted tax delinquent property owners.  The owner had purchased the property from a county auction.  I believe he broke even on the deal.  We sold the property to a neighbor adjacent to the property.  The negotiation was easy on both ends, and it was a cash deal so our closings were quick.  

We are reinvesting our profits into our business, and are looking for more deals.  We have purchased two more properties since this deal.

[Jack Butala]

Thanks for the kind words, Luke. We have been experiencing the same kind of success over the last 15 years. One of our greatest challenges has been That No One Believes us. Congratulations on finding your niche.

[Victor Noriega]

Luke, those are awesome numbers.  What are you mailing costs per letter on this type of volume?  I'm limited on time, and it limits the number of calls I can receive, research, and respond to.  I also just started to expand beyond Texas.  I'll use your numbers as a benchmark to reach at the end of the year.  

[Christopher Henschen]

Luke, I'm sorry I am new here so I may be asking a stupid question but what type of property are you buying?

[Matt Snow]

@Victor Noriega Thanks for sharing your success! It's awesome to see this strategy working for you. How has this last year been for you deal-wise? 

[Victor Noriega]

@Matt Snow short answer. Bought five properties sold four. Made $20k in profits. Not as good as my first year. But good enough for only working 4 hrs a week. 

To many distractions this year at my 9-5.  I tried several new things to improve automation. And the end of the year has been busy. I'm sending 250 letters a week. I'm working on exceeding the 2016 profit in January.

Good luck to you and all land investors out there. 

[Matt Snow]

Thanks for the update @Victor Noriega. Really good to hear that things are still moving along for you, even with the day job. Keeps me motivated to not give up.

Hope this next year is your best one yet!

[Jay Hinrichs]

My dad did this for 20 plus years in CA.. his biggest year was 800 lots sold...

I cut my teeth selling land when I was 18 and a freshly minted RE agent...

@Matt Snow  we still own unbuildable lots up behind the trout farm in .. on the way to loch Lomond.

A developer named George Triphon bought about a thousand of them back in the 60's that was my Dad's first land project... I used to hang at the trout farm in.. Then it was up to Russian River then Lake county... Boise Cascade built 27 lake type developments throughout CA.. those were prime to buy pre tax sale in the late 70 to 90s not so much now as values have finally risen..

there are millions of lots through out the west.. Key is finding the buyers..

[Jay Hinrichs]

@Matt Snow  and in my mind far better for beginners then trying to wholesale houses which can be dog tough and huge failure rate.. the cost to play is so cheap this is a good beginner step .

[Matt Snow]

@Jay Hinrichs Wow. 800 sold in a year! That is truly amazing, and something to strive for. I imagine a lot has changed in this area since then.

I actually drove by the Trout Farm Inn last summer, unfortunately it had just been burned down from a kitchen fire. I believe the owners plan to rebuild it though.

It's very encouraging to hear that you started with land at such a young age, and have come so far from that point. The low-cost to entry and smaller risk is the only reason that I've been able to jump in the game. Would you happen to have any thoughts on getting started with finding those buyers for small vacant lots?

[Jay Hinrichs]

@Matt Snow  watch the movie Glenn Garry Glen Ross...

My dad tired of getting 4  company leads a week.. he bought a printing press and created his own door hanger ( direct mail was too expensive) then on Sat and sun .. my brother and a few friends would pass them out.

this was remember the 60s were a 8 year old could walk around in strange cities putting door hangers out..

Today you would get arrested for child abuse. LOL

this led my dad to getting 10 to 15 leads a week and becoming Number 1 salesmen.

then his own company and well the rest is history.