I would sell the exchange property for $420K and buy the empty lot through the exchange for $200K and take out a building loan for $220K.If I own the property first I can make the first two months of improvements (site prep, utilities, permits, and foundation) before I sell it to myself through the exchange and make sure it is done by the end of the 180 day clock. 

We don’t require any down payment (unless it’s your first deal and you have a deal where the rehab + purchase price + closing costs are under 70%, we may lower how much we loan you so that you have skin in the game).

I am new to Durham and have been wanting to get into the Real Estate game locally and am finding it very competitive and pricing very high. 

Pick different potentials in the same investment market...run the numbers before and have a list of what you need to know or look at, then run the numbers after...depending on the property and intent use one of the calculators on this site for every one...work it as and then use the tool to calculate what it would need to be  --  if they are the same then it might be the right deal.Once you have this then you can move to other surrounding markets easier...just make sure you adjust your assumptions to align with that market.One final note and this depends on your area, here in FL you have to account for what your property taxes "will be" not what they are. 

@Kyle Miller there are some that are really changing the game and as others have said they often operate at a loss to gain market share, but with Technology changing, we are going to see changes in the space.

I can help you develop a game plan for targeting pre-foreclosures.

Welcome to the site Todd.

Welcome to the site!

They have more skin in the game then you do.Make sure you get clear title.

I have been learning by listening to podcasts, watching youtube videos, and reading books and blog posts (the BiggerPockets web site has good specific recommendations).