I'm under contract to buy a 1.2-acre land lot, on which I plan to build my primary residence. I found out that I'll need to build an access road as you can only get to the property by crossing another property. There's already an access easement, so there's no problem there. But I'll need to build the road myself, which will likely be costly (especially since it'll involve clearing some trees first).
Next to the property I'm buying there's a second nearly identical lot for sale that has the same access problem. However, the future easement road I would build would serve both properties. My question is this: Should I just buy both properties, build the road, and then sell the second lot (now improved with an access road) for a profit?
Otherwise, whoever buys the second lot will benefit from my easement road without having to contribute to it. Plus, I'd like to invest in real estate anyway, and think maybe this could be a good start?
Curious if anyone here:
*Has experience with flipping land lots and has any general or specific advice for me?
*Has any recommendations for the best way to estimate what I can sell the second land lot for once I'm done with the easement road? Do I just need to comp similar nearby lots on Zillow etc.?
*Knows any specific risks I should keep in mind with this type of deal? I don't really want to get stuck with the second lot as I'd like to use the funds to build my primary residence (My plan is build a big ADU first. Then a second bigger house sometime down the road).
Here are some details on the deal:
*I'm buying the first lot for $60K, and I think I could get the second lot for the same amount (maybe even less?)
*I'm financing the property with a land loan. I have a total of about $20K to put down. Previously, I qualified for a $120K land loan with just 15% down ($18,000), so I think I could finance both land lots.
*The seller bought the property in November for just $40K, which seems pretty low. A couple months ago, they listed it for $80K before dropping the price down to 70K and then $65K. I negotiated it down to $60K. The fact that the property doesn't seem to be getting much traction makes me think it's because it's landlocked and maybe I could stand to make a profit by flipping it when I have to build an easement road anyway. I feel like similar (accessible) properties nearby are being listed for at least $100K.
*The easement road would have to be about 250 feet long, but I plan to make it a gravel or even dirt road initially to keep costs down.
*The property is in Mason County, Washington
Let me know if I left out any important details. Thanks in advance!
