How Much Can You Make Flipping Land?
So you're wondering what kind of return you can expect from flipping land. I will walk you through exactly how much you can expect to make on your investments. But before we get started, I’ve created a new mastermind group to help you with your land investment business. If you want to work together on getting through your first or next land investment deal or need to know how to scale your business, The Land Flipping Formula Mastermind is for you. It’s hosted on Facebook for only $50 a month! I drop content in there daily, bite-sized nuggets that you can take action on immediately. I'm there to answer any questions and help you with anything that’s holding you back from achieving the results you want.
Sweat Equity=More Profits
Now let's get into the content piece here; what type of return can you actually get flipping land? The reality is the numbers are all over the place. But the return on your time, stress, and finances is massive. So first off, let's talk about your time in the land investment game. You can automate the whole system if you want. Now it will take some sweat equity in the beginning—building and setting up your platforms, getting your marketing automated, fine-tuning your email list, you know blah blah, all the boring stuff. You have to put in the work upfront. But once you have all that set up and you’ve got some good advertising, it really is just a push-play system. You send out mailers, hopefully to highly motivated sellers. These highly motivated sellers are going to accept your lowball offer, you're going to take down the property, and then from there, you're going to blast it out to your email subscriber list. You offer them a phenomenal deal that they could add to their portfolio, and then from there, you're going to profit wildly!
Now let’s talk about the stress piece. I first started in the residential real estate investment game. That is an intense, incredibly stressful business. It's pitched as one of the sexiest business models, but you’re never told about all the unforeseen issues. The unexpected things never stop showing up. I'm talking about tenant drama, court drama, payment drama, just drama drama drama. There can be money drama all across the board. The residential real estate game is not what it's all cracked up to be. And sure, you could argue the wholesale game has a lot of chaos too. In the wholesale game you're going to get a house; maybe you get all the way to the closing table, and then the title company finds that one detail that got overlooked. The whole time you were counting on that fat check, and boom, it's gone. You made nothing, you exhausted a ton of time, and you accumulated a lot of stress.
Land Investing Is Low Stress
So here’s why land is not as stressful to invest in—there's no drama. When you market a property to your buyers and they purchase it outright or on seller financing, they enter into a contract with you. The contract is done digitally via DocuSign. The contract states everything clearly, so all parties have to agree. That’s why it’s essential to have an easy-to-read contract. By the way, if you need that, I will give you a copy when you join the mastermind. Just reach out to me after you join, and I'll email you a copy of the one we use. Obviously, you should still have your local attorney review it and make sure it holds up to everything on your side of the table—I just need to cover myself on that! But anyway, it's a very easy-to-read contract, and we do a ninety-day clause. So let's say the buyer stops paying you, and the clock starts ticking. Once they ghost you completely for ninety days, they clearly no longer want this property. Then you can just take the property back and resell it. You're not giving anybody the deed till they've paid it off. It remains in your company name; they’re just doing a contract for deed or rent to own, whatever verbiage you want to use. Once you're paid off, you deed it over. However, if they default, the time starts ticking, and they have whatever time you put in the clause; most people say sixty days. I like giving people an extra fair shake and setting it up for ninety days. So there are no courtrooms, no drama, and no additional fees. You just blast it back out to your email list, and it sells again.
You Can Reach Financial Freedom
This brings us to the final piece, finance. It’s hard to give you a set number because it varies, but it is phenomenal when you do this right. So let's go over some scenarios. I've been doing deals in Washington County, Florida, lately. I sent direct mail marketing to out-of-state owners that own quarter-acre lots in Washington County. My offer price is $500, but we still have closing and advertising costs. So on average, I'm closing these at about $1,500. Sometimes a little less, sometimes a little more, but let's call it $1,500. When I flip using a real estate agent, I walk away with about $3,500. With the buy-in price of $1,500, I'm making about $2,000 in profit, doubling my investment. We all live at different levels, but let's just say our monthly expenses are around $10,000. To be financially comfortable, you will need to do five of these a month. That's pretty low stress. Now, sure, you do have to send out a lot of mail to get the conversions. But I did the math, and at $2,000 a pop, you knock out five of those, and you’re good to go. Your house is paid, your car is paid, your insurance is paid, your food's paid, and you're probably at a break-even point.
Some people might need a bit more or less, but the point is you don't have to do a whole lot. You just have to dial in your marketing. We're using an agent for the exit strategy, so the returns are phenomenal. And also, that's with us taking title to the property. If you're signing the contract, your return could be even higher. But I don't like any stress in the middle, so I take full title and put up the money. Then we don't have to worry about the clock ticking and possibly losing the deal. We own it; now we can market and flip the property. Then there's the seller financing aspect. That depends on the market. With seller financing, you can do $100 down, $100 a month for sixty to seventy-two months, getting anywhere from $6,000 to $7,200. Plus, you can write into the contract that the buyer is responsible for the property taxes. So now you are literally just floating the paper; you're getting the cash flow!
Wrapping Up
Now, if you want to be financially free, this will take a little bit longer. You must build a massive portfolio of these $100 a month properties to pay your living expenses. But once your build your portfolio, your returns skyrocket. So it depends on your position. If you're the type of person who just needs some fast cash to catch up on things, then you can focus on flipping and get a phenomenal return. If your money situation is pretty good, but you want a little extra cash flow to put your mind at ease, you’ve created another income stream alongside the nine to five. I do a lot of these seller financing deals, so I know that wherever you're at on the journey, if you do this right, the deals will deliver an incredible return. Of course, bad things can happen; that’s investing. But we're big kids over here, and we know there's risk in everything. That’s why we focus on the good and just know if something goes wrong, we could always walk away from the deal. We don't always have to take the title. So I can’t give you a solid number but trust me when you do this right, it's a stress-free way to get that cash flowing.
Check out my YouTube channel if you’re interested in more land investing tips. Also, if you have any questions about the land investing business and need some coaching, shoot me an email at michaelalder34@gmail.com or check out landflippingmichael.com. Then, we can see if we are a right fit for each other and lock you in for a coaching call.
