Website Closers® presents an online land marketplace unlike any other. The founders of this business have designed a systematic technique to purchase land anywhere in the United States for pennies on the dollar. They use this system to acquire land inexpensively before marketing it to buyers on the MLS, their website, and other marketing channels at market prices.
The typical customer for this business is the end user of the lot who wants to build their forever home or buy it for recreational purposes such as camping and hunting. An individual piece of land is meaningful to the end user for their own specific reasons. In many instances, no other alternative will replace something they have seen and set their minds on.
The company presently operates in only five states. Florida accounts for 70% of revenue, while Georgia follows at 15%. The remainder is divided among North Carolina, Alabama, and Tennessee. The system, however, is designed to work in all 50 states, presenting immense expansion opportunities.
An average net margin of $43,000 is achieved per sale after all closing costs and commissions are paid. Enticingly, there are more significant deals available for a well-funded buyer. For example, the team recently closed a substantial deal that profited the company by $440,000. Had they been able to self-fund it, they would have doubled that number.
For acquisitions, sellers are generally permitted two to three weeks for closing. The company makes use of that time by performing further due diligence on the property while concurrently sending it to the title company or closing attorney with whom they work in that area. The title company or closing attorney handles all legal work, title searches, and title insurance. Days before closing, the team is sent closing documents, which they execute by sending a wire transfer.
There is no risk of buyers failing to pay. Title offices or closing attorneys handle the escrow of funds, and payment is made to the business once closing is completed. Property ownership is never transferred without payment. Additionally, the company has all but no accounts receivable. It receives wires on 99% of properties on closing day. Seldomly, a certified check is mailed after closing, which will arrive a day or two later.
90% of buyers pay cash for the land, while almost all of the remainder secure funding themselves. A fractional number of transactions are done with a funding partner to offer buyers financing. In those cases, the property is sold to the financing partner, who subsequently sells the property on terms. Those terms usually include a 10-15% down payment followed by around 10% for 5 to 7 years. Owner financing is a potentially lucrative revenue stream that a new owner could bring in-house if that’s in their wheelhouse.
Summers have traditionally been the most popular sales months for the company, owing to several reasons. It’s warm, people are on leave, it’s when most people with kids like to move, and many people visit an area on vacation, fall in love with it and then look at land concurrently.
The two owners work, on average, 10 to 20 hours per week. Hours vary depending on the week’s schedule and how many closings they have on the buy and sell side.
One partner oversees the land selection, purchasing and selling processes, setting market prices, and negotiating through realtors with buyers to sell properties. He also handles closings outside of Florida.
The other partner creates new systems and processes as necessary, performs HR duties like hiring, payroll, and vacation approval, and handles all wire transfers for closings. In addition, he manages investor relations, accounting, and all closings in Florida.
Employees comprise a team of virtual assistants that handle most aspects of the business. They help with everything from the acquisition process and listing properties for sale to contacting trusted local realtors and selling the property.
Independent contractors, including realtors, title companies, and closing attorneys, are used pro re nata.
The existing owners are equally open to helping with a smooth transition and moving on as they are to committing to being at-will employees to a buyer for a certain amount of time. For an appropriate valuation, they will consider staying on as salaried minority partners to assist in advancing the business to unprecedented heights.
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