By Judy Dutton
• 4 min read
This land is your land—for $300
A guide to buying raw acreage for dirt cheap, and a few pitfalls to avoid.
A guide to buying raw acreage for dirt cheap, and a few pitfalls to avoid.
Mark Podolsky hated being an investment banker. “When a buddy said he was buying raw land for pennies and flipping it for a lot of money, I told him I didn’t believe him,” he says. Then he grabbed three grand he’d saved for car repairs and tagged along to a court sale in Deming, NM, “and did exactly what he told me to do.”
Podolsky bought 10 half-acre parcels for around $300 apiece, then promptly sold each for $1,200. He told his wife he wanted to quit his job to flip land; she said absolutely not. “It took 18 months for my land income to exceed my banking income. I quit in 2002,” he says. Since then, he has flipped 6,000 parcels and founded The Land Geek to guide others.
Podalsky’s approach is simple: Sift through public records for land owners who are behind on property taxes and make them a dirt-cheap offer. He then turns around and contacts the owner’s neighbor. “I’ll send a letter: ‘Here’s your opportunity to protect your views and privacy.’ Often, the neighbor will buy it,” he says. If not, he lists the plot in Facebook groups, on Land.com, or on his own site, wholesale.thelandgeek.com.
In rare instances, land can rise in value. “In Texas, large tracts are being acquired for data centers and solar farms,” Byington says. “That makes it imperative that buyers research future development plans. Homes are more predictable, but land has more upside potential.”
Zoning will dictate what you can build or farm, how far down you can dig for water, and more. “In drought-laden Texas, you don’t have carte blanche to dig a well,” Byington warns. “Wells have run dry here, and I’ve seen neighbors paying to get water carted in. We hold our breath hoping that’s not us soon.”
Other rookie mistakes include purchasing landlocked parcels with no road access, not understanding deed restrictions, and assuming utilities and septic will be available and “easy” when they’re anything but. Her advice? Read the fine print. “When I was buying my first property, the seller attempted to include an addendum reserving the mineral rights, which can be extremely valuable in Texas,” Byington says. “Fortunately, I caught it, but many buyers don’t.”
California investor Josh Justiniano learned just how expensive “cheap” land could be after building a duplex on a parcel in Bakersfield, CA. Before he was issued a certificate of occupancy, he had to spend around $40k on permits, fees, and building sidewalks. “The sidewalks cost $10,000 that we didn’t see coming,” he says. Lesson learned: “Talk to city planning and ask about off-site requirements like fire hydrants, gutters, or other infrastructure before you close, not after.”
All that said, Podolsky points out, “There isn’t a piece of land where someone can’t do something on it, even if it’s not obvious. I had a buddy who bought a mud pit. At first, I thought, ‘What a disappointment.’ Sure enough, someone rented it to drive around in his ATV. I’ve seen people buy swampland to grow shiitake mushrooms. I once mistakenly bought the side of a mountain for $2,500. A film director bought it off eBay for $32,500 so he could film there.”
And even if land owners don’t do or build anything at all, they dream that someday, they or someone in their family will: “People buy land to say ‘I own this part of the world.’”
