Took The Plunge!
Contracted on some acreage and some more land yesterday. 85 acre parcel, 45 acre parcel and 35 building lots! I will either be bankrupt in a year or buying a yacht!
I have been doing well with Single family housing but this time I bought acreage and available lots from a motivated seller (long story) next to The Villages FL. It is the fastest growing area in US. They are building homes for affluent retirees. It is the #1 largest construction project in the US and #3 in the Country right now.
Hope I haven't bitten of more than I can chew with this newest venture! Banker says I can handle it and you know how conservative they are. So I may be ok.
I have contacted several builders and have some serious lookers but will get nervous fast when the interest pymnts start.
Any of you other guys doing developments and can advise about best way to market this, PM me or post here. I would love to hear your success stories with speculation on raw land.
[ Edited by Ricker on Date 04/01/2004 ]
I love to see more FL happenings! Sometimes I think I'm the only one here...(still in the early / lonely stage)
Well, I'm currently trying to work on S/F rehabs myself, and gradually working into the L/O deals.
I can only tell you that if it is anything like Port St. Lucie where you are.... and I dont know any of the terms of your deal of course....then you should do well.
Properties purchsed (1/4 acre or larger) 5 years ago in PSL at $5K are going for 40K now. My realtor has investors that bought low and are still buying, building, and making 50-100K per lot/home.
They are selling pre-construction deals (it is a hot market though) and I'm sure thay are getting some decent up front returns from the deposits to keep themselves afloat. Deals are completed, homes finished in about 8 months.
Sounds good to me. But I'm just an optimistic rehabber at this point. Maybe others have more info for you....
SG
Ricker,
Without a doubt you are now in the drivers seat! If the area is as hot as you say, then once the engineering in done and local approval is granted, you can go ahead and design that yacht!
You have so many options available once the property is yours.
1. Offer a local engineering firm some lots in return for free engineering and up through the approval stage. Once you are within site of approvals, your phone will never stop ringing.
2. Do some preliminary engineering while getting the word out. I have been asked numerous times to sell my current project (200 acres) in New York State.
3. Never get pushed into a corner because you are worried of the interest payments! You'll kick yourself in the A$$ the next day when that new offer arrives.
4. Really do your due dilligence with brokers, and select maybe three to five whom have good builder contacts.
5. Play fair and you will reap many rewards!
Good luck. 8-) [ Edited by flyboy on Date 04/01/2004 ]
Ricker,
To flyboy's great advice, I would add:
1. Choose your engineering firm very carefully. See if you can find out what firms have developed "positive" relationships with the municipality.
2. If you haven't already done so, make sure you have a real estate attorney who's experienced in the municipal approval and development processes.
Do you plan on selling lots to builders or contracting with builders to market "total packages" (house on lot)?
edited by Ricker [ Edited by Ricker on Date 04/09/2004 ]
Ricker,
Best wishes on your new projects.
Last October I bought my biggest deal ever. It was a one of a kind property in a hot market and I paid a premium to get it. If this project does not work I will sink fast.
Guess what? Today, six months into the project I had a closing that paid off my bank, paid back my investment and put profit in my pocket. From here on out it is pure gravy.
REI investing beats having a real job!
great thread
[addsig]
Ricker,
Can you tell me what type of financing you are able to arrange on a land purchase? (LTV and term) I am interested in investing in land however I am clueless regarding the usual financing.
Thanks,
Adam
Ricker,
Been following your posts with interest... I live just a couple miles from the Villages and have developed thousands of acres (not in Sumter County). What you've got going sounds exciting!
How much time do you have before closing on the three deals? Are they separate transactions?
Without knowing your specific deal it's hard to give specific advice... but I would leverage off the massive advertising being done by the Villages' developers and promote your USP (Unique Selling Position). Advertise heavily in ways that will reach all the prospective buyers down here looking at the Villages.
For example, run ads in all the local papers promoting your USP (are you cheaper? better location? No HOA fees? etc.) Make the headline stand out -- use the misfortune of the prior developer... "Bankruptcy Avoidance Sale" or something similar... (Best Ad I ever ran was "Divorce Forces Sale"... )
Anyway... the terms of the deal are usually more important than the actual piece of land... hopefully you've got enough time built in to the contract(s).
Ken Wade
edited by Ricker[ Edited by Ricker on Date 04/09/2004 ]
you go boy. how about a 42' hattera.{big bucks boat!}........good luck....kenmax
you're going to be in the yacht, AND the Bentley..... wish I were you!!
Like a good novel I can't wait to here the end of the next chapter in this story. Keep us informed. You are inspiring me to look at way s to develop land that I own and look for more land to invest in. Thanks
Update: I am approved for the bank loan but had to take a partner to purchase both the subdivision and the acreage. Have decided to retail the lots. Have several builders wanting a few for specs. Am getting the 85 acres surveyed and appraised for he bank.
Here is an update:
subdivision post