How To Buy Land During A Market Crash
Chaos in the marketplace is a certainty. But what does this mean for your land business? I'm going to walk you through some strategies to make the most of drastic changes in the market. You can scale and be profitable in your land investment business even when the market is down. In fact, you can use the panic to make bigger profits using an easy step-by-step process, and then use your extra cash to make even more money!
Use Panic To Your Advantage
The market is volatile. It can go up and down at a moment's notice. When it tanks, people panic and sell. This panic makes everything plummet, and naturally, you're going to get a little nervous. Everybody does when these things happen, but what does this mean for you? Use the panic to your advantage. If you're serious about land investing, this strategy is for you. You can get properties cheap to flip them for fast profits or sell them on seller financing terms for monthly cash flow. People will trade hard assets in down markets, and there will always be buyers for your land deals. If you are prepared for down times and you're in a position to do direct mail marketing, then you want to get a little ballsy. You could make your offers even lower than normal. For example, in Florida, let's say we are targeting quarter-acre lots that we knew we could sell for $5,000. You want to pick these things up crazy cheap, so let’s offer $500. I've done this many times, and I've purchased plenty of deals under these terms. But in times like these, people are freaking out, and they want hard cash because they think it will save their lives. This gives you better conversions.
Take It Step By Step
So let’s walk through this. Maybe you went to Lee County, Florida, looking at Lehigh Acres. First, reach out to a company like Offers2Owners for direct mail service. You want to have them target out-of-state owners in Lehigh Acres, Florida, quarter-acre lots. Then remove all LLCs and mail everybody an offer of $500 per property. Buy a thousand letters and send them out. When you send out a thousand offers, you can typically get about three to five accepted offers. But when people are in panic mode, you may be able to get double or even triple the number of accepted offers. People just seem to sell fast during these times. So now people accept your offers, and you'll get the signed contracts back. Take the signed contract and send it to the title company you've picked, somewhere in the property’s area. The title company will do all the paperwork. They will tell you the total amount for closing, all the title fees, closing costs, and taxes for the purchase. So you should be all in for around $1,100. Then you wire that money to the title company, they pay off the seller, file the property deed in your name, and you're ready to resell.
Options For Your New Cash Flow
Now you have a couple of choices moving forward. If you need some fast cash, you could give it to a heavy-hitting agent who works near the property. They can put it on the MLS and flip it for around $5,000 after fees. So you'll get a check for $4,000 minus the $1,100 you invested in the property. You just profited $2,900 before tax. Your second choice would be to buy more mailers and put that money back into your business. A third choice is to list the property on different platforms and sell it on seller financing terms. You could do something like $75 down and $75 a month for sixty months. This kind of pricing makes it desirable to buyers and gives you some monthly cash flow. Now you can use that cash flow to make more money however you want. You could buy dividend stocks or crypto or just purchase more property for your next deal, whatever the case may be. Just keep your money growing and flowing.
Wrapping Up
The main takeaway is don't freak out if the market crashes. A downturn can be a phenomenal time to invest in raw land. If you're in the position to send out offers, get on it quickly. Take this opportunity and use it to pick up some phenomenal deals and expand your portfolio. Land investing is great in any market, but being ready to take advantage of downturns can really help explode your business growth.
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 or check out landflippingmichael.com. Then, we can see if we're a right fit for each other and lock you in for a coaching call.
