Welcome to the June 2022 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 that you can choose to 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.
June 2022 Income Report – Total Revenue: $178,831.06
I do my best to make these reports insightful.
I know 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 2 big reasons for doing this:
#1 – Motivate ourselves to improve our business (nothing like putting it out there to the public in order 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.
We also like to connect with other investors or private lenders that have similar goals. You can find us on social media on Instagram, YouTube, Twitter, TikTok, or by email.
Without further delay, let’s get into the good stuff.
Here are the June 2022 statistics:
Now for a little insight into these numbers.
The revenue for June was less thank I had hoped, but it’s still a pretty impressive figure when you consider that we sold our very first land flip a little over a year ago. The reason that the revenue is not that high is because many of the properties sold this month were lesser value properties.
Our gross profit per deal was well below our previous year to date average of $25k. $11k profit per deal is not a horrible thing, but it is underperformance based on the standards I’ve established and the averages I’ve been able to achieve so far in this business.
We did sell a total of 6 properties this month which is pretty good. Again, it’s just that as a whole, these were less valuable properties than we’ve sold previously. Based on our revenue this month, the average sale price was less than $30k.
I am very happy that we were able to send out almost 100,000 mailers this month. This costs a good amount of money now (about $50,000), but I know it will payoff in future months.
The lifeblood of this business is getting mail out. When you stop sending mail, the deal flow will eventually stop as well. It takes time to get the machine going again so any dropoff in our mailing will likely have a huge negative impact down the road.
Our average days in inventory has shot up as well this month. That’s because we cleared out some of the oldest properties in our inventory that skewed this average. Unfortunately, the longer a property is in inventory, the less profitable it will be as well. We reduce properties on a regular basis until they sell. So, the older properties have generally been reduced to the point where the profit is lower than average as well.
Keep reading the report for a deal by deal breakdown of all the properties we sold this past month.
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 in this business.
These are all the deals that closed in June 2022. We purchased the property (normally in a previous month), and then resold the property to a new buyer.
***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 = # of days we owned the property
Return on Investment = Gross Profit /Purchase Price
Deal #1 – Julie Rd
Deal #1 notes: This was a successful deal for a number of reasons. I ended up purchasing this property from a seller that I had purchased multiple properties from in the past. I knew for experience that this was a popular area and I was very confident in my pricing. We listed this property with an agent and found a buyer right away. The escrow period was a little longer than normal, but in total we owned this property for less than 2 months and made a 41% return on our investment in less than 2 months.
Deal #2 – Old Dover Rd
Deal #2 notes: This is one of those properties that were in our inventory for a while. It actually had a has on it that may or may not have been repairable. It also had numerous smaller lots that combined for a total of about 2.7 acres. I thought it was going to sell for more, but in hindsight, the small town where it was located didn’t have much going on. It turned out that there weren’t many people in the area interested in taking on a huge project like this. I ended up selling it and only profiting $2,000. At least I didn’t lose money! Plus, now I know how big of a factor location plays for a property similar to this.
Deal #3 – Quarter Rd
Deal #3 notes: Again, this property was in our inventory for awhile too. The issue with this one was the odd shape of the property. Plus, there were some wetlands on a portion of the property that limited how usable it actually was. I got a perk test done on this property which helped it’s marketability, but only after it was on the market for awhile. I should have gotten this done right away. The lesson learned on this one was that I should have considered how the shape of the lot would impact it’s value.
Deal #4 – Roswell Rd
Deal #4 notes:This property was another longer term hold. The purchase price was pretty low on this property, but the resale value was pretty low as well. When you look at the 69.33% return on investment in under 90 days, that’s pretty amazing by most standards. It’s just that with a lower property value like this, it’s going to be tough to meet my revenue and profit goals for the year. I’m already trying to pass on some of these types of properties so I can focus on bigger deals.
Deal #5 – Dewberry Ln
Notes:This property was in our inventory for a long time as well. But, the reason for the long hold was a buyer that wasted a lot of time with us while we were under contract. They ultimately couldn’t get their financing done and then couldn’t close. We found a new buyer pretty quickly, but had to wait for a new escrow period in order to close on it. The return on investment was 79,74% in under 90 days. That’s great, but since it is not a bigger price tag, the impact on our business is pretty minimal overall.
Deal #6 – Spearman Rd
Notes: How can you argue with a 219.65% return on investment in 28 days! Yes, this was a smaller dollar property as well. But, I really can’t pass up those types of returns. This was a small piece of farmland and there was a buyer that stepped up and offered full price ($29,900) that day it was listed. They closed with cash and were happy to pick up this property. For us, it was a pretty easy deal all around.
Year to Date 2022:
2022 Year to Date (YTD) Statistics
Half the year is now done. We’re not halfway to my goals, but we’re making good progress!
We’ve already passed our revenue and profit for all of 2021. I know that momentum is just starting to build, so I’m expecting a huge 2nd half of 2022.
I originally wanted to hit $5 million in revenue in 2022. I’m not sure if that is going to happen, but I do think that $4 million is pretty likely. Time will tell!
So far, we’re averaging just under 5 sales per month. I’d like to get that up to 10 sales per month.
Our average gross profit per deal is $22,396.55. That’s pretty solid, but this month brought that average down quite a bit. Hopefully we can bump it up next month.
The average days is inventory is still under 60 days. I’m very happy with this and I’ll do everything I can to keep that here.
I’m super focused and ready to crush it for the remainder of 2022.
The returns detailed above are very substantial. That is especially true when you consider the hold time and annualize the Return on Investment.
Let’s use Deal #4 as an example.
The return on investment was 69.33%, which is amazing in the world of investments. We held this property for 89 days (longer than average). 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 284.33%!!
Where are you going to find returns like that?
In the stock market, if you’re getting a steady 10% a year, you’re crushing it
But, if 10% a year is crushing it, what is 284.33% per year called?
How can you do the same thing as an investor and get these kind of 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 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
In the future, I may decide to offer a training program to teach these skills. For now, I’ve got nothing to sell you. But, you can find a bunch of free content on our Youtube channel and on our podcast that discusses real estate investing.
Just as a disclaimer, investing money comes with risk. Because without risk, there are no returns. Research any investments heavily before putting any of your money at risk.
And, you can check out this page that will feature other podcasts and outlets where I’ve been interviewed.
If you’ve got funds that you would like a better return on, please fill out this form. I’m looking for private money lenders that want to earn a great return on their money secured by these deeply discounted properties we’re buying.
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.
One last thing, if you liked this, you’ll also learn a lot from this video I filmed. It’s our 50 First Deals that we did in the land flipping business. It’s a very detailed breakdown and it gives you a good idea how our business started and how we did on each deal. Get it here.
That wraps up the June 2022 Income Report. Sign up here to be notified the minute a new report is published.
P.P.S. In case you missed it, here are the links to my past income reports:
