Land in a development sense could be treated as a deductible inventory cost, but only when it is sold.

Inventory is low, been looking.

Will inventory increase?

Inventory in Cleveland has really dried up lately, so I think that’s a big factor in prices going over asking price.  

There's just not that much inventory in our area.

There are tons of buyers out there and inventory is limited.

During any economic downturn, buyers tend to flock to more affordable homes, reducing inventory and driving up prices in that segment of the market.

You also typically have to compete with builder inventory or newer homes when selling. 

@Nikki KofkinOh yes, I agree with the other post (sorry, this app doesn’t let me see your post when replying so I have to do it from memory).Flips are generally considered ordinary income subject to self employment taxes as well since the irs considers you to be dealing in inventory instead of selling an investment.If you are also wondering about the quarterly timephasing, I’m told if the irs thinks you are too “uneven” they will charge the interest penalty again.

Inventory is moving very, very quickly right now in the Chicago market and when I list a property it is typically gone pretty fast if it is priced aggressively.