Land Deal

[Anthony Ruiz]

Hi BP,

I'm a long time reader time reader, first time writer. I'm usually able to find the answers to my questions by reading through older post. This time I'd really appreciate any advice and insight to a potential deal I'm working on.

Here's what I'm working on.

Spoke to a FSBO. She is an elderly woman who is currently living in a home that sits on two acres. She is looking to sell the land and move into a mobile home park in a near by city. The land has utilities hooked up to it. She owes nothing on the property. No liens, back taxes, etc. She is a retired broker and is looking to sell for only the land value. She's asking $620,000.00 Doing my research though the county tax assessor and collector's office, their sites give a roll value of $59,850.00. The land has been in her family since 1944. She told me the lot adjacent to her's is another two acres her grandfather gave to the city; which they have done nothing to it. The area is a very highly desired area. Within a one mile radius builders are building new homes. The new town homes going up start at $375,000.00 and another builder is building estate homes that sit on half an acre starting at the low $900,000.00. It's zoned R2, county permits 4 house per one acre. That could potentially be 8 homes. She had mentioned or 14 condos. She said she's been offered cash and closing in 30 days from several builders, but said that isn't enough time for her. She is obviously not in a rush to sell. I do not have it under contract yet. I told her i'd like to do some research before making an offer. She said everything is negotiable.

I had a few thoughts on what I could do and wanted to get some feedback. 

1) I can borrow up to 65% from a private lender friend at 15% interest, with 12 months to pay back. I can get the other 35% from a partner and offer him a percentage as well. I'm thinking I could sell the property to a builder, pay back the funding and pocket the rest.

2) Add in my fee and wholesale to a builder or investor looking to get into new construction. Without borrowing any money.

3) Wholesale to an end buyer, but keep a portion of the land for myself to build on and live.

I've read the exit strategies for wholesaling before having an end buyer in place. IE. inspections not passing, partner not agreeing, etc. It sounds like she'd rather sell to a family then a builder. 

I'm a newbie and this would be my first deal. I thank you all in advance.

Thanks,

Anthony