Flipping bare ground?

[trophy_killer]

Long story short my mother is a realtor and two months ago she was approached by a family friend who was in the beginning stages of foreclosure on his house, however he had a bare lot that he wanted to get rid of quickly in hopes of saving his house. Anyways she relayed the info to me and I decided to check it out and decided I couldn't pass up the deal and was able to pick it up for roughly 50% of what market value is on it. Now I'm up in the air between selling it to make a quick dollar or hanging onto it. I know for a 100% fact I personally would never want to build where it's located. So what would you do? Hold onto it in hopes the market eventually turns and make a greater profit or sell it now and make a quick easy profit?

 

[174in]

It all depends I guess How much are the taxes? The way the market is right now you may not come out to far ahead if you have to pay taxes on it for a few years.It wouldnt hurt anything or cost you a dime to put it on the market right now for the price you want for it.It might suprise you and sell right away for twice the price you got it for if its in the right location.I just bought a 1 acre lot myself that I plan on building on if my house is ever sold.This lot has already been cleared and also has village water and sewer available for $800.00 I was able to pick it up from the bank for 33% of the asking price and the assest value. Good luck

 

[mixedbag]

I think 174 gave good advise.Put it on the market now for what you want for it.The marketWILL come back around;it always has.

 

[pointingdogsrule]

I am NOT a TAX ACCOUNTANT (and I don't play one on TV), however, some good points have already been stated.... 1. taxes 2. upkeep. Secondly, you might want to contact your tax man. I believe that if you take an investment (property) and flip that property in less then 3 years the taxes on your "profit" will be substantially higher, as opposed to holding that land for over three years.

good luck on your new property.

good luck to all
the dog

 

[Gunner46]

Is that land going to put burgers on the grill at Camp next week ?

 

[npaden]

I'm not a tax accountant, but if you hold it for a year you would only pay 15% tax on the profit, if less than a year then the profit would be taxed as ordinary income.

 

[Moosie]

Why wouldn't you go down, Buy a couple thousand $ Single wide, throw it on it for the short term, Rent it out for a couple hundrerd a month and let it cash flow . Depreciate it out. File a Schedule C tax return and come out ahead......

What I don't get is the land and how it's tied to the house. Is it totally seperate piece from the house ?

Unless it's a DONE deal, another thing you could have done was have them DEED over the land for free, then you could have bought the house on a short sale and rented it back. You would have needed 20% to buy a rental but the land might have covered that ?

Unless you're planning on building on the lot, I'd dump it though. Over the long haul if you're not making money on the lot, you're loosing money. Taxes was the key. If you give 10k for a lot and the taxes are $500 a year, is it worth it ? You're out quiet a bit in 5 years. The values of homes and bare land up there won't be rising in the next 5+ years.......

 

[trophy_killer]

It's just a vacant lot Oscar, and it's actually in California. Had it been in Salmon I wouldn't have even thought about doing it as property values are sinking like a rock right now. Anyways, I think I'm going to take 174in's advice and list it for what I'd like to get for it and see what happens. Thanks guys!

 

[sweetnectar]

I think I'm going to take 174in's advice and list it for what I'd like to get for it and see what happens

Amen to that. Besides property tax is an awful thing.

 

[tjones]

Moosie and real estate advice? yikes!

 

[WV Hunter]

Why wouldn't you go down, Buy a couple thousand $ Single wide, throw it on it for the short term, Rent it out for a couple hundrerd a month and let it cash flow . Depreciate it out. File a Schedule C tax return and come out ahead......

What I don't get is the land and how it's tied to the house. Is it totally seperate piece from the house ?

Unless it's a DONE deal, another thing you could have done was have them DEED over the land for free, then you could have bought the house on a short sale and rented it back. You would have needed 20% to buy a rental but the land might have covered that ?

Unless you're planning on building on the lot, I'd dump it though. Over the long haul if you're not making money on the lot, you're loosing money. Taxes was the key. If you give 10k for a lot and the taxes are $500 a year, is it worth it ? You're out quiet a bit in 5 years. The values of homes and bare land up there won't be rising in the next 5+ years.......

Do you have a newsletter I can subscribe to? I like the cut of your jib

 

[WV Hunter]

Me, I don't buy bare land unless I can build some units or dump a trailer.

Sell it and try to make some money.

 

[Moosie]

Moosie and real estate advice? yikes!

You buy and loose a couple homes in Foreclosure and all of a sudden people don't think you're advice is any good. GESH, I thought better of you guys :=)

Do you have a newsletter I can subscribe to? I like the cut of your jib

I could sell Ice to Eskimo's if I was motivated.... and didn't get side tracked... or ... OHHH look, something shinny !!