Welcome to the April 2023 Income Report. This report is where I document our statistics and progress with our land flipping and development business.
I’m a big fan of the land flipping model of real estate investing. As you’ll see, it can be very lucrative and also rewarding.
We resold our first property using this model in March of 2021, and we’ve been on an accelerating path ever since.
We’re passionate about real estate investing in general. Land flipping is just one of the many business models you can pursue as a real estate investor. We dive deep into this model and many others in our real estate investing podcast called Turning Profit. You can find us on Youtube and all the other major podcast platforms.
Before we get into the report, I invite you to check out Land Conquest.
This is not your typical “group.” It’s an actual community of people interested in land flipping. We’ve got brand new investors as well as investors generating $1 Million plus per year.
In the coming weeks, I’m releasing an extensive training program to share exactly how we run our land flipping business so you can do the same. It will be absolutely FREE.
April 2023 Income Report – Total Revenue: $207,164.11
I do my best to make these reports insightful.
Your time is valuable, so I want you to get as much out of this as possible.
So why in the world would I publish a report like this for the whole world to see?
I’ve got three big reasons for doing this:
#1 – Motivate ourselves to improve our business (nothing like putting it out there to the public to drive progress).
#2 – Motivate you! You’ll see what’s possible and learn valuable lessons (at my expense) which will allow you to become a better real estate investor yourself.
#3 – Gain exposure for our new Land Flipping Community
Before we get into the numbers, I will lay out a simplified explanation of how this business works. This will give you a little bit of context into these numbers in this report.
Here’s how the business works:
- We send letters (actual offers) to landowners.
- Some landowners respond and are interested in selling.
- We come to an agreement on the price and work towards closing the deal.
- In the meantime, we research the property in depth by sending out a photographer, calling the county/city, getting an opinion from a local broker, and many other little things on our checklist.
- Assuming all looks good, we complete the purchase with our own cash through a reputable attorney/title/escrow company.
- After closing, we will sometimes make some minor improvements to the property, such as brush clearing, perk test, surveying, or other things.
- We list the property using a local broker that will market it in the MLS, to their buyer’s list, and to neighboring landowners.
- We negotiate a deal when a buyer steps forward.
- We complete the sale at the negotiated time.
- Rinse and repeat!
A couple of other notes:
- We buy these properties all over the country and rarely see them in person
- Purchase prices on the properties range from $4k to $360k (in 2022)
That’s about it… It’s really just buying and selling land.
The main thing that makes this business work is that we buy for an aggressive price so we can resell it for an attractive price to buyers. That allows us to sell quickly. We can negotiate good purchase prices because we pay cash and will close quickly.
Now that you know the basics, let’s dig into the numbers.
Here are the April 2023 statistics:
Well, this wasn’t my best month. In fact, it was a big disappointment.
The revenue was much lower than we anticipated. Yes, $207,164 is a lot of money, but based on the trajectory and track record, I would like to see this much higher.
The gross profit for April was $67,131.47. This is a sizeable amount of profit, but not nearly what I need it to be at this level.
The big problem for April was that I only closed 2 deals.
Originally, I thought we would close 5, but then we had a few deals fall out of contract which really impacted things.
Deals falling out of contract are a normal part of real estate investing and land flipping. While it’s frustrating when this happens, it’s to be expected that a certain percentage of your deals will fall apart for a variety of reasons.
Over the years, I’ve realized it’s counterproductive to dwell on these missed deals and instead move on and work on finding a new buyer as quickly as possible.
When your business is new, each deal that falls apart feels like a catastrophe because you are banking on that sale. As you grow in the business, each deal means less, and when you have a lot of deals going on at the same time. One deal doesn’t mean that much anymore.
If there is one bright spot in April, our average profit per deal was $33,565. This year’s average has been about $23,000, so seeing this big bump is nice. I’m striving to do bigger and bigger deals, so this average profit per deal should continually increase.
Over these 2 deals, our average days in inventory was 87.5 days. This is still higher than the 60 days I’m shooting for, but hitting that figure has been tough this year. I believe some of that has to do with the slowing market and the other part is the fact that I’m focusing on bigger deals. Only time will tell to see where this averages out.
Deal by Deal Breakdown:
In this section, I break down each deal. The goal of this is to show you how deals vary in their profitability and what is possible.
These are all the deals that sold in April 2023. We purchased these properties in a previous month and then resold the property to a new buyer in April.
*** Details of the properties have not been shared to protect the anonymity of the parties to these transactions.
Purchase Price: The amount we paid for a property, including closing costs
Revenue: This is the amount we received after paying commissions and closing costs
Gross Profit = Revenue – Purchase Price – Property Specific Expenses
Days in Inventory = number of days we owned the property
Return on Investment = Gross Profit /Purchase Price X 100
Deal #1 notes:
I made $20,543 in 61 days on this 60-acre land flip.
We bought this 60-acre property “off-market” directly from the previous owner. They responded to one of our offer letters that we sent them in the mail. After some discussion with the sellers, we agreed to buy the property for $87,392. Our initial offer was lower than this, but we had to come up in our price to put the deal together.
I knew that this price I agreed to would leave us with a slim profit margin. I’ve sold a number of properties in this area, so I was confident in the value and was ok with a slim deal. I knew I could make money on this property, just not the normal returns I shoot for.
This is a nice wooded property in a very rural area. There was nothing negative about the property that we could find, we closed the purchase as soon as the title company completed the paperwork.
After we closed, we immediately listed it at $129,900 with a local land broker that has sold a bunch of properties for us. In a week or so, a buyer submitted an offer that we could work with and we negotiated a price of $121,000.
The closing process went smoothly with no issues. After 61 days of ownership, we closed this resale and ended up with a profit of $20,542 after all commissions and closing costs. The return on investment was 23.31%. Not my best land flip, but not so bad either. The short hold time meant that I could reinvest my money quickly and still make over $20k in the process.
Deal #2 notes:
I made $46,588 on this 19.5-acre land flip in 114 days. Here’s how I did it.
We found this deal by sending out direct mail. The seller got a letter from us, gave us a call, and then we finalized a deal.
I knew this was going to be a good property because there was a lot of demand in this area. The property was a little neglected, but the location was good.
This was a wooded property that was really overgrown, and it had an old mobile home on the land that was not salvageable.
Nothing odd came up during our due diligence process, so we closed it as soon as the paperwork was ready to go with the title company.
As soon as we closed the purchase, we listed it for $119,900 with a local land broker. I considered having the mobile home towed off, but I’ve always had good luck just leaving these old mobile homes on the properties and selling the land as-is. I was also going to have some of the overgrown brush cleared, but the contractors I talked to were so busy and unavailable.
Within a week, we were under contract for full price with what appeared to be a solid cash buyer. After a few weeks, they backed out of the deal for an unknown reason. This wasted some time and was a little frustrating, but I knew we’d find another buyer soon.
After a couple more weeks on the market a buyer stepped up and we agreed to sell at $109,900. This was $10k lower than the last contract, but I decided to go for it because there was still a really good profit margin on the deal.
This time, the closing process went off without a hitch. We received a wire for $98,478 after commissions and closing costs were paid. That left us with a profit of $46,588 and a 92.55% return on investment in 114 days.
After all the dust settled, the buyers ended up getting a good deal on a cool property, and I ended up making a really good profit.
Year to Date 2023:
2023 Year to Date (YTD) Statistics
Although our April wasn’t the best, we’re still making some really good progress in our business.
So far this year, we’re sitting at a revenue of $2,073,726. It was nice to pass the $2 Million milestone, but we’ve got a ways to go before we hit $10 Million, which is my goal for this year.
We’ve brought in $759,559 in gross profit this year so far. That’s a good amount of money and I hope to build upon that as we progress through 2023.
Our average profit per deal has steadily increased this year, and now we’re sitting at $25,318. Getting this above $30k per deal would be huge, and I think it is attainable. We’ll see!
The average number of days in inventory is at 113.32 days so far this year. This is way higher than I like it to be. I believe this figure has increased for a number of reasons:
- We cleared out some really old inventory at the beginning of the year that skewed our numbers.
- The market is slowing down in some of the markets we deal in.
- We’re focusing on bigger deals which generally take longer to sell on average.
Going forward, I’ll be holding out for better purchase prices. If the market is softening or even declining in some areas, there will still be activity, but the prices will need to be more aggressive to sell quickly. Buying for the right price will help alleviate the longer days on the market.
The returns detailed above are very substantial. That is especially true when considering the hold time and annualizing the Return on Investment.
Let’s use Deal #1 as an example.
The return on investment was 23.51%, which is a really good return even if it took a year. What really makes this special, though, is the fact that we only held this property for 61 days. When you do the math and annualize this return (if you were to keep this money invested for the whole year), the annualized return on investment would be 140.67%!!
Where are you going to find returns like that?
In the stock market, you’re crushing it if you’re getting a steady 10% a year.
But, if 10% a year is crushing it, what is 140.67% per year called?
How can you do the same thing as an investor and get these returns?
The first thing you’ve got to do is start learning.
It’s not rocket science, but it’s also not as basic as it seems.
Here’s a short list of some of the basics you’ve got to learn to make this land flipping model work:
- How the business model itself works
- How to get the leads coming in
- Where are the best regions to find deals?
- How to evaluate properties. What makes a good property and what makes a property not desirable
- What software and tools to use to give yourself an unfair advantage
- How to talk with property owners that want to sell
- How to navigate the escrow/title process in multiple different states to buy a property
- How to find the best on-the-ground partners in each location
- How to find a buyer for your property in a short amount of time for a good price
- How to negotiate with sellers and buyers.
- How to build a team so you’re not doing everything yourself
- How to put a business system in place to automate processes and keep your business organized
If you want to learn how to flip land as a part-time investment strategy or a full-fledged business, you need to learn all this.
I can help you with that for free! I’ve just launched an amazing land flipping community full of supportive and super-smart people.
I’m working on a complete training program (ready soon) that will be completely free. I do not have anything for sale now, but I may offer a paid mentorship program if you need a higher level of assistance later this year.
For now, join our new community for free and get access to all the free training as soon as it is released.
Just as a disclaimer, investing money comes with risk. Research any investments heavily before putting any of your money at risk. Risking more than what you can afford to lose is never a good idea.
You can also check out this page that features other podcasts and outlets where I’ve been interviewed and talk about land flipping. I’ve appeared on over 50 podcasts and am booked for many more in the coming months.
Want to benefit passively from my land flipping business? I’m looking for private money lenders that want to earn a great return (12%+) on their money secured by these deeply discounted properties we’re buying. If you have available funds over $250,000, check out the program details on this page.
We know that the figures in this report may seem unattainable at first glance, but this did not just “happen” overnight. Like any business, we made progress and improvements over time to get to our current income level.
That wraps up the April 2023 Income Report. Sign up here to be notified the minute a new report is published.
P.S. In case you missed it, here are links to some of my past income reports:
- March 2023 Income Report $674,265
- February 2023 Income Report $464,159
- January 2023 Income Report $728,137.29
- 2022 Year in Review Report $3,474,800.60
- December 2022 Income Report $256,473.60
- November 2022 Income Report $440,368.81
- October 2022 Income Report $275,462.13
- September 2022 Income Report $281,160.95
- August 2022 Income Report $322,223.92
- July 2022 Income Report $495,885.83
- June 2022 Income Report $178,831.06
- May 2022 Income Report $208,782.57
- April 2022 Income Report $264,322.07
- March 2022 Income Report $479,193.91
- February 2022 Income Report $67,143.23
- January 2022 Income Report $204,952
- 2021 Year in Review Report