Land Play w/ Cash Flow

[Shuff Mauldin]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $80,000
Cash invested: $10,000

Old Single Family Home on a 2-acre lot zoned commercial and is adjacent to a strong development, making the dirt itself the real value driver.

What made you interested in investing in this type of deal?

The commercial development next door drew my attention to the two acres with a dinky house.

How did you find this deal and how did you negotiate it?

Deal Machine letter to the owner and stayed in touch while his elderly mother lived there. He got an appraisal and that is the amount he wanted. He appraised it as residential and not commercial so I was not going to argue with him.

How did you finance this deal?

I was going to use traditional bank financing but the seller was happy to get 3% on the money.

How did you add value to the deal?

I would like to say I did a lot but I got lucky finding a handy tenant willing to fix up the home and not call me with complaints.

What was the outcome?

I paid off the home and am trying to determine over the next 4 quarters if I want to build commercial. I could be great for additional storage, condo, apartment, or possibly mixed use.

Lessons learned? Challenges?

The note I did with the seller was solid but a seller's kids and relatives can be really annoying. Sometimes it's better to pay them off.