Small towns - Posted by Diane (IN)


#1

Posted by charles(del) on January 25, 1999 at 24:22:55:

I think investing in small towns is great. I live in a small rural county of only 100,000. The deals are smaller and more manageable plus it is easier to network and not as intimidating. I have also had great success with land development (residential 2 acre country lots).


#2

Small towns - Posted by Diane (IN)

Posted by Diane (IN) on January 24, 1999 at 17:05:20:

I am wondering if any of you are building (or have) successful business’s in a small town. My town is very small and surrounded by a few other small towns. The towns closest that probably offer more prospects are 30-40 minutes away. Not a bad drive but A) long distance and B) not easy for quick decisions and being johnny on the spot.
Not that I am giving up or anything crazy like that but there are few to none when it comes to looking for abandoned properties to buy and flip. Just wondering if anyone else is working in a small town and if you have any suggestions for a newbie? Thanks!


#3

Re: Small towns - Posted by Bill OK

Posted by Bill OK on January 24, 1999 at 21:33:25:

Well now. I am from a small town. Population 540.
What do I do? No new homes in the last 10 years. No people moving into the town. Old homes falling down around those that live there. Others vacant. In the last 3 years doing Lonnie Deals there are 14 new families living in this little town. All homes were moved in. Placed on the old home lots where ele-sewer-water were all their. Sure it cost to move them in and I learned lots of new lesons. But I now own the lots and the MH’s. That’s a small MH park. Paid hardly nothing for it. Looking at another small town now. It’s in the eyes of the beholder what they see.


#4

Re: Small towns - Posted by Darin

Posted by Darin on January 24, 1999 at 18:58:59:

There is opportunity every where. Have you thought about investing in land. 10’s, 20’s, 40’s,& 80’s. There is serious money in vacant land. Depending on your states split law and the township the property sits in, you should get to know that market and how it works. Here is a couple examples

1- 80 acre parcel located on a corner of 2 main roads in the country with a 1200 sf house in rough shape.

Purchase price - $250,000

Leverage - 20K down - 10% interest - with annual intrest payments only - a 2 year pay off

Contingent upon the property getting 10 lots approved from the health dept. for percs for septic systems.

Contingent upon getting partial releases for each lot sold.

Some other standard contingincies also.

Got approval for 11 lots

3- 2 Acre parcels priced @ 35,000
7- 10 acre parcels priced @ 50,000
1- House of 2 Acres priced @ 129,000

Total $584,000

Ecpences

Percs 2500
Survey 15000
Transfer 5000
Title 2920
Realatarts 50000

Total 325,420
Net 258,580 Time fram ( Less than one year )

These projaects can be completed within 6 - 12 monts

To turn these quick, stay away from having to put in any roads and stay away from plattting. Though there is big money in development, it also takes years and tons of money before you get to your first closing.

Another example

20 Acres
Purchase price 92,000

3- 2 Acre parcels @ 50,000
1- 14 Acre parcel @ 65,000

Total $ 215,000

Expenses

Percs 2,500
Survey 7,000
Total Sales cost 23,000

Total 124,500
Net 90,500 ( Less than 1 year )

Go to your township and get a plat book and start calling. You will be suprised what you get.


#5

Re: Small towns. What town?? - Posted by Doug Jones

Posted by Doug Jones on January 24, 1999 at 18:51:04:

I am from Centerville, which is close to Richmond.
3000 pop, but 45,000 in Richmond. There are deals,
but less competition.

I now live in Tampa Fl and the competition is full force. These guys have full time people making offers for them and secretaries that answer the phones.
1 guy told me that they had a private lender with $1,000,000 available to them and that they still run out of money sometimes!!

Good Luck

Doug Jones

p.s. I still love the weather here and would not EVER
want to move back!!!


#6

Re: Small towns - Posted by phil fernandez

Posted by phil fernandez on January 24, 1999 at 18:09:27:

Diane,

I have been working in a small town for over twenty years. In the eighties I had competition. Now I have very little. The market is open to me.

If there are very few abandoned properties in your area why not focus on other aspects of investing like wholesale flipping, lease options, mobiles, bank REO’s. There are numerous avenues to pursue. You can always keep your eyes open for abandoned properties in the meantime.

By the way I live in a city of about 8,500. The population of the county is about 40,000.