Posted by Tony Colella on December 16, 2004 at 20:32:12:
This is what we termed a “semi-development deal” in the book. They can be cash intensive, although financing (both private hard money and lender financing) may be found.
It is often easier to tap the financing once the deal is completed. Flipping land/home deals can be profitable but often takes a good deal of time until one has an entire system in place (lenders who finance higher credit risk etc.).
The time it takes to setup, market and sell can keep your equity, not to mention the tax hit.
If you are seeking to tap the equity for cash for other deals, why not keep the lot or the entire land/home deal?
Lonnie, like many here has found that owning the lot and selling the home provides a long term - passive, rental income stream (with all the benefits of eviction vs. repossession). Tax benefits, lease/option (to lower maintenance responsibilities), owner finance etc. provide the foundation for a retirement type investment income.
Tony