| Is there enough of a glimmer on the horizon to buy land or is it still the toxic asset of the commercial real estate world for a few years? Sure seems enticing at times to jump into the fray, especially some of the REO deals from banks. |
more |
 |
| Related Answers: |
| |
Posted by: Lynch, Kevin
Arlington Heights
|
There are crazy land opportunities today. You have to have to understand the demographics, area demands… but it is a great time to be pulling the trigger. I mentioned this in another question but it is worth repeating:
Banker says land is a “toxic asset”. Consider the source of this comment. If the “toxic asset” the banker is talking about fell 50% or more in value, it may be toxic to the banker but it could be a great deal for you. Be smart, consider the purchase price, carry, improvement costs… My formula is: 25% raw land cost, 25% carry, 25% infrastructure, 25% profit. Thus you have to buy land at $1.00 per square foot, assume $1.00 to pay the carrying costs, $1.00 to add infrastructure and $1.00 in profit.
|
| Answer this question |
| My banker says "Land is a toxic asset" at the moment. You agree? |
more |
|
| Related Answers: |
| |
Posted by: Lynch, Kevin
Arlington Heights
|
Banker says land is a “toxic asset”. Consider the source of this comment. If the “toxic asset” the banker is talking about fell 50% or more in value, it may be toxic to the banker but it could be a great deal for you. Be smart, consider the purchase price, carry, improvement costs… My formula is: 25% raw land cost, 25% carry, 25% infrastructure, 25% profit. Thus you have to buy land at $1.00 per square foot, assume $1.00 to pay the carrying costs, $1.00 to add infrastructure and $1.00 in profit.
|
| Answer this question |
| How do I figure out a monthly lease rate for an acre lot worth $850,000 with property taxes at around $1,300/month? |
more |
|
| I need help filling out a contract for deed form. Is this something I could get help with? |
more |
|
|
