3 Ways to Sell Land Fast
What is the best exit strategy for big profits when getting into the land investment game? Should you flip the properties yourself, pass them off to investors or wholesalers and have them do the dirty work for you, or give them to a licensed real estate agent to list and bring in their pool of buyers? I'm going to walk you through each scenario so you can decide what's the best fit for you. That way, you can increase the odds of getting paid much faster!
1. Do It Yourself
So you're getting into the land investment business, and you need to determine your exit strategy. What works best depends on the size of the properties. First, let's talk about off-grid properties, which is where most people start. It’s pretty easy to start with these cheap, little lots in New Mexico, Arizona, Western Texas, and Southeast California. You want off-grid lots around one acre or smaller in size. Usually, your acquisition will be under $500, and you'll flip these for about $1,500. There's not a ton of meat on the bone if you're giving it to a wholesaler or a real estate agent. With these properties, you need to buy ad space on platforms like LandFlip or start a YouTube channel talking about the properties and promoting them on social media. That way, you can keep the bulk of the money in your pocket. The outlay is going to be your advertising cost. Advertising will be around $50 to $100, and then the filing fee is $25 to $50. The rest of the money is yours. So on these tiny lots, you have thin margins. You want to handle the whole transaction on your own to maximize profits.
Next, let's say we're getting into bigger deals. Maybe five-acre to fifty-acre properties. These lots are still off-grid properties. These are going to have a much wider margin for you. For example, on five acres, you may get around or slightly under $5,000, and on up to 50 acres, you may get $30,000. These have plenty of room for profit if you did a good job on your acquisitions. If you sent out direct mail marketing, targeted out-of-state owners, and gave a lowball offer, you could acquire these lots for next to nothing. Now, this opens up several doors for you. You could do the promotions yourself, which is still a good thing, buying ad space on all the land platforms and generating buyer leads. The upside to that is even if you don't convert them, you're gathering data from people that are interested in owning land. You could then sell that info down the road. So you want to have that data no matter what.
2. Work With Investors And Wholesalers
Next is your investor or wholesaler exit strategy. You can reach out to other investors on the platforms and say, “Hey, I noticed you have a lot of properties in these areas. I just took this property down, and I would be willing to sell it for (whatever price).” You have to give it to them at a wholesale price, though. So do the cold calling and make some connections. Then, if your exit price is around $30,000, and you acquired this thing for $5,000, you could sell it quickly to investors for $15,000 or $20,000. Then they'll take the property to their buyers, and they'll flip it for $30,000 to make a quick $10,000. Another thing to consider is some wholesalers will do joint ventures with you. For example, if you took down a property for $5,000, and they bring the buyer, then you can split the deal fifty-fifty. You can work these types of deals however you want. I love when someone comes to me with all the data, they're aggressive, they're a great salesperson, and they're going to make things happen. So that's another way to look at your exit.
3. Use A Real Estate Agent
Then finally, real estate agents can come into play. If they specialize in an area or certain types or sizes of properties, you can give it to them; they will probably charge you around ten percent. They will charge you a little more because the exit price will be a bit smaller. But they're going to get this on the MLS for you, which gives you access to a gigantic pool of new buyers. They'll handle the transaction, and you get the profit minus their fee. Right now, I'm testing the waters in Florida. And while I have used all these exit strategies, I typically do all the deals myself, or I’ll flip them to other investors. That's just how I work. So if I’m doing it myself, I’m selling directly to the end consumer. If I have investors or wholesalers, I’m just marking it up a bit, grabbing that fast cash, and getting on to the next deal. In Florida, I recently purchased a few properties from real estate agents. So if an area looks promising to me and I want to test it out, I’ll buy a property directly from a real estate agent. Then I’ll market that property to see if I like the area. If I get a positive response and sell the property fast, I’ll do a bunch of direct mail marketing. I'll buy as many of these as I can for next to nothing, and I’ll turn around and list them online with seller financing terms.
These things flip fast, so that's when I know I’ve got a great area. Recently I had some deals default, I took them back, and I decided to give them to agents to list for cash purchases. Now I’m going to do more of this if I get a positive result from the deal. So I gave a property to an agent in an area where he has a lot of these listings and a lot of knowledge. He put it on the MLS for a ten percent commission if he makes a sale. We're going to test everything out with him, and if he converts these deals, I will send out a ton of direct mail marketing. Then I’ll give him a percentage of the deals to list for cash purchases. The rest I’ll market on land investing platforms and to my email list of hungry buyers and sell them on seller financing terms to get those monthly notes out of the deal now.
Wrapping Up
Now you know all about three solid options for exit strategies. You could use these to profit from your deals, but don't limit yourself. Start with a few different methods in the beginning, and then see what works. Then, if things are working well for you, you could scale those into bigger deals, build out your portfolio, and get the profits you're after. Now you probably have some questions about this, new areas, how to make offers, or how to do direct mail marketing. If you need to learn more about the land investment business visit my site.
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. Then, we can see if we're a right fit for each other and lock you in for a coaching call.
