In this podcast episode, host Ron Apke reveals 10 sure-fire ways that anyone can make money off of land.
Be aware that some of these strategies can make you cash FAST, while others are meant to be long-term investments that appreciate over time.
In no particular order, we are going to start with the first way to make money on land, which is how myself and my brother Daniel started out in the land industry.
This is our bread and butter. This is how we got started. Buying and flipping land involves purchasing vacant land in rural counties for 40% market value, and then reselling it to make a profit.
The best strategy: direct mail & texting.
How do we flip? By reaching out to 10,000 to 15,000 people per month via direct mail & texting. That’s going to yield you five or 10 deals and you will do this over and over again.
A Minor Subdivide is when you purchase a property with around 50 acres or more, and break it down smaller plots (for a 50 acre lot, you’d divide them into five 10 acre parcels).
After you break down the parcel into smaller plots, you’ll get new parcel numbers from the county and you’ll be able to sell these plots individually and make a lot more money than if you sold the land as one piece.
With a Major Subdivide, you’ll still be going after the 50 acre+ property sizes, but instead of simply separating the parcels, you are actually doing a bit of work to the property to prep it for selling.
A lot of times you will have to put roads in and getting utilities installed such as well systems or sewage.
You aren’t necessarily developing on that land, but we’re prepping the parcels to sell to individual builders.
You can make a lot of money with this strategy, but it takes a lot of education and learning the correct way to do it. It will also be a slower process – somewhere between 12-18 months to sell off all of the parcels.
This strategy entails buying the land and then developing something on the land.
This is a project based strategy where you are purchasing a property and then making improvements and building on top of it.
Whether it be a subdivision with houses, mobile home park, commercial real estate, etc.
Obviously a lot more time-consuming and more work goes into this, but the payout can be massive if done correctly.
With Seller Financing, you are still going to be buying a piece of land for cheap. This is going to be a long-term, monthly cash flow type of project.
You are buying a $100,000 piece of land for $40,000, and then selling it to a buyer on terms.
Basically, you’re selling the parcel as if it’s a mortgage, and you’re going to get paid by the person who purchased the land from you on a monthly basis.
Learn more about Seller Financing HERE.
Leasing a property that you’ve purchased to a farmer can be a great way to make money. Be aware that you will have to do a lot of due diligence to find out if the land is viable for farming on, but it can be a great way to ensure a consistent cash flow.
Hunting leases can be just as good, and you can get around $6,000 per year for their rights to hunt on your land. Again, you will have to do research on how to make a property good for hunting.
The next strategy is a process called Entitlement. This involves buying land and then rezoning it for commercial development.
This process involves getting into contact with the municipal government and setting up an agreement to change the zoning permits.
While this process can be time consuming, it can potentially yield you millions of dollars.
This approach involves the owner (you), securing a piece of land that either already has a productive forrest on it, or finding a piece of land that is good for planting new timber.
This is a great option if you are looking for a long-term investment. While it all depends on the quality of the timber on the property, it also could mean huge profit 20 years from now when they are grown and ready to be sold.
Keep in mind this strategy requires the land to be in specific locations. The best spots for gas/mineral rights are in West Colorado, Oklahoma, and the East Coast.
You can lease out these rights to an oil company to pull oil from the land for a certain amount of time essentially, and then make minor improvements.
Whether you decide to flip the land and make quick cash, or hold long term for a huge payout, land is and will always be a lucrative way to invest your money.
Listen or Watch the full podcast episode below ⬇️ to get more insight into each of these strategies and start making massive profits off of land!
Welcome to the real estate investing podcast, where we help you unlock your potential freedom through land investing, real estate investing, and entrepreneurship.
Ron: Hey everybody, welcome back to the real estate investing podcast. I’m your host Ron Apke. Today in this episode, we are going to talk about 10 different ways that you can make money in land.
So traditionally we talk about making money in land by buying under market value and selling at or at market value essentially. Um, so you’re buying at 40 percent of market value. Reselling at 90%. You can make a ton of money doing this. Um, but land right now is such an untouched niche. There’s so many things within land where you can make a lot of money.
Some strategies are going to make you quick cash fast, kind of like we talk about with, uh, buying and flipping buying under and flipping, and then there’s other strategies that I’m going to mention here that might be longterm holds where you’re going to make money from appreciation, but you’re also going to make money yearly.
So let’s get to it. Number one on the list. And. Guys, this isn’t in any particular order. I’m going to be going through 10 different ways, uh, in really no particular order. Like I said, all of them, you can make a lot of money. Number one is buying and flipping. And that’s what we do. We buy for 40 percent of market value and resell on the market.
How we do this, you do it through direct mail. You do it through texting. You need to get deals. Then name the game when you are buying. Under market value is being able to find the deals and you need to market to a lot of potential sellers. If you’re reaching out to five sellers a week, a hundred sellers a week, you might get a deal eventually, but it’s not going to be consistent.
While the way we do business is reach out five, 10, 15, 000 people. And then that’s going to yield you five or 10 deals and you can do this over and over again. So that’s number one. Number two, minor subdivide. What I mean by minor subdivide is let’s just say 50 acres, for example. And there aren’t as many restrictions when you’re doing what’s called a minor subdivision.
A lot of these rural counties in the country. want you to subdivide their land. So you take that 50 acres, you, uh, move it down and, uh, you break it down into five, 10 acre parcels. And that a lot of times is going to be deemed what’s called a minor subdivision. All you need to do for this is get a plat, get a survey, get a local surveyor to survey it off.
You’ll get new parcel numbers from the county, and you’ll be able to sell these separately. The numbers on what a minor subdivision looks like, a lot of times you can buy it for close to market value. So let’s say you’re buying that 50 acres for 100, 000. If you do five, 10 acre parcels, those might each sell for, I don’t know, 50, 000 and then you could get 250, 000 on the deal.
That’s what those numbers look like at scale. And you can obviously do it with bigger and bigger parcels. One of the biggest things with minor subdivisions is making sure you have enough road frontage. So a lot of counties, you don’t want to be putting in roads cause then you’re getting to major subdivisions.
A lot of times you’re going to have to put utilities, find, make sure electricity is back there. So having enough road frontage on your big parcel before you cut it up is really key. Number three, major subdivision. So this is where we’re breaking 50 acres into 51 acre lots. You’re a lot of times putting roads in, you’re putting utilities in.
It is, I’m not saying we’re developing on that land, but we’re just cutting it up into that. And then we’re going to sell those individual parsers, parcels to builders. This is a way you can make. Like, if you do it right, you can make a ton of money, but it’s going to be a slower process. It might take you 12 months, 18 months, two years even, depending on the county, depending on the permit.
Like, you’re going to need permits, you’re going to need utility companies, you’re going to need a ton of land work in terms of clearing areas, putting roads in. And That there’s risk in this, like doing that, there’s a ton of risk. The market can change if the builder’s market goes way down and you don’t have builders 18 months from now, you are sitting on 50 lots that you probably have some financing that you’re paying or, or whatever.
But if you do this right. If you buy the land at the right price, you’re cost effective with everything you’re doing. You are quick with the permitting, uh, aspect as quick as you can be. You can make millions of dollars on these deals and that’s without putting in anything on the land. Number four is actually developing land.
So this is, I mean, you could do it from a minor subdivision or a major subdivision that you do. You could throw mobile homes on there. You’re developing something on the land. Whether it’s mobile homes, you’re building a house, you’re putting small houses, you’re putting cabins, whatever it is, there’s nothing to this in terms of other than improving the land.
By developing it, you could develop five, five parcels at once, put five houses on five different parcels, sell it, make a ton of money when you’re doing this level of improvements. It’s not really like we talked about. Number one, the key to buying and flipping is buying very, very cheap, buying the land cheap.
When you’re doing these big improvements, a lot of times the land price, I don’t want to say it doesn’t matter, but you do not need to buy at 40 percent of market value because you are adding so much value on the backend. Number five, seller financing. This is going to be longterm. Uh, cashflow essentially.
So what you’re doing, you still, you want to buy the land cheap when you’re doing seller financing. So by a hundred thousand dollar piece of land for 40, 000, sell it on terms. So you’re still selling the parcel, but you’re going to get paid every month. So maybe you get a 20, 000 down payment and then they pay the other 80, 000 from that a hundred thousand dollars.
So a hundred thousand dollars. 20, 000 down payment and they pay that 80, 000 with interest over 10 years. So you’re getting monthly payments, I don’t have the math in front of me, but you’re getting a few hundred dollars a month for 10 years essentially. And after that 10 years, you don’t own that land, they will own the land outright, just like a mortgage essentially, that’s how it works.
But a lot of times when you’re doing seller financing, You can get 11 plus percent plus interest. You can get 12 percent interest. That’s not a crazy thing. And it’s really good investment. If you are looking, or it’s a really good strategy. If you’re looking on getting that interest, it’s a little safer.
You do have that. There’s a chance that they could, you can need to foreclose on them. They stop their payments. You need to go through the foreclosure process. I personally am not a huge fan of seller financing because of. The cashflow and you still need to collect those payments. It’s not a ton of cashflow and you have to manage those payments just like if you had a rental property.
I think we’re on number six guys. So we had buy and flip minor subdivide, major subdivide, develop seller financing. Number six, I’m combining these two farm lease slash hunting lease. So this is you have farmland, you’re leasing the land to a farmer. Great thing about farmers is they take unbelievable care of your land.
A lot of times they’re going to improve or appreciate the land just by them farming on there, keeping it active. If you do need to lease it to someone else, if that lease expires, it’s not that difficult that those leases are all going to be per acre, uh, depending on the quality of your land. You don’t want to really turn your land in the farmland if you run into a deal where you have some farmland leasing out the farmers is amazing.
You can make typically, I don’t know the numbers in front of me. So I don’t want to say the wrong thing. Hunting is the same thing, but with recreational land, uh. Hunting leases can be, it’s around a hundred to 200 per acre per year. So it’s not a ton, but if you have 50 acres, you might be able to get five, 6, 000 per year for their rights to hunt on it.
Cash on cash. So that’s a little over 10%. So it’s not bad. Or I’m sorry, cash on cash. It matters what you bought the land for. But, uh, if you get a good deal on 50 acres, you want to hold long term. You don’t want to sell it. You like the area and you like the appreciation. It’s not a bad idea to lease it out and have some cashflow while you are owning the land.
Number seven, entitlement, what entitlement is on land. It’s essentially rezoning the land. So you buy land. That is zoned for commercial or something like that. And then you rezone it for a development. So let’s say it’s zoned for a commercial, whatever, just a commercial industrial building, whatever it is.
Entitling is taking that land and then going through the process with the city, with the county to get the zoning change. There is a ton. You can make millions of dollars doing this in a single deal. There’s a ton of money, but it is a long strenuous process. We have not done this strategy as of today. We have not done this strategy, but there is a lot of money in it changing that industrial zoned parcel 30 acre parcel to residential where someone can come and develop.
There is a lot of money to be made there. Number 8 is timbering the land. So you take, you get it timbered. You sell, you sell essentially the timber on your land. The negative with timbering land is it is going to, uh, there’s gonna be a negative aspect to your land. So if you’re looking to sell it. Soon, I would not suggest clear cut timbering it because then you’re going to have timbered land, it’s going to be less desirable, and you’re going to end up making less money.
If you want to hold land long term, then timbering could be a great option because you’re going to get paid really well per acre if you have good timber on it. It’s all depending on the quality of the timber on your land. But then you replanted or you have it replanted and 20 years from now, you’re going to have full trees, again, full timber.
And you also have that money that you made on timber. So it’s a situation by situation. You can also, um, select cut is what it’s called timber, where you do not timber the whole land, pick and choose areas of the land, have it select cut that can actually improve the quality of your land as well as make money on the land.
Number nine, gas from gas and mineral rights. I’m going to be 100 percent honest, guys. I am not overly educated on gas and mineral rights within land, but essentially what that is, is a lot of it’s out West Colorado, Oklahoma, a lot of, so you have surface rights. People own surface rights, and then people own subsurface, gas, mineral rights to the land.
Those are separate. A lot of times on the, in the Midwest and the East Coast, these are all combined. Like the same person owns gas, or the same person owns subsurface, and the same As the person who owns the, uh, surface rights, uh, there, it can be sold separately though. Those can be separated where the subsurface rights are owned by one person and the surface and above rights are owned by someone else.
Um, you can lease out this so you can lease it out for oil, that kind of stuff. And that’s where people, you can make a lot of money in this. Obviously you got to educate yourself, learn what to do in that. Um, but. Gas, mineral rates, all this stuff. You can make a lot of money. Oklahoma is huge for a Colorado is very big and there’s leases that go for 10, 15, 20 years where they lease it to an oil company to pull oil from the land for a certain amount of time, essentially.
And number 10, finally, it’s just minor improvements. This is one that is very broad. When I say it, it’s adding a driveway. It’s adding utilities, just minor stuff. We’re not fully developing the land, but you’re minor, you’re, you’re improving the land just a little bit as far as, like I said, adding a driveway, clearing a building spot is a big one.
Um, adding whatever it is to the land, just an improvement. You could add a pond, like you can dig a pond on the land to do a minor improvement. This is going to increase the sale price. If you do things right. It’s going to be, you put 10, 000 in and you’re going to get 20, 000 more on the sale price. If you do it wrong, you might put 15, 000 in and 15, 000 improved on sale price.
That is not worth it to do a minor improvement. You need to have increased sale price relative to the money you put in for it to be worth it because you also have an increased time. With minor improvements, you’re going to want to buy things. Undermarket value on the front end and then put a minor improvement and then resell other than that guys Those are the ten like I said at the beginning there’s so many different ways in land to make money I think as land becomes more popular like people are gonna utilize different ways.
Some people are gonna want longer term cash flow Which is great while some people might want those quick, what we do, the majority of what we do buy and flip minor subdivide, that kind of stuff. Those do really well. Um. And that’s quick money where minor subdivisions you can close in six months. Uh, it’s very normal buy and flip.
You can get your money turned around. You can turn 50, 000 into 100, 000 within 90 days. Other than that, break them down one more time for you. Number one, 10 different ways you can make money from land. Number one, buy and flip. Number two, subdivide. Minor subdivide. Number three, major subdivide. Number four, develop the land.
Number five, seller financing. Number six, farm slash hunting leasing. Number seven, entitlement, number eight, timber, number nine, gas and mineral rates, and number 10 minor improvements. Other than that, guys, thank you so much for watching. Hopefully this was helpful. Hopefully you can see a couple of ways you can make money in land.
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