Small in-town lots or big rural tracts for a first mail list

Question

I'm building my first list and I've stalled on the very first filter, parcel size, because the two people I've asked gave me opposite answers with the same confidence.

Case for small infill lots, under an acre, inside a town or city limit: they're already served by water and sewer in a lot of cases, zoning is written down and someone at the counter will explain it, and the buyer is a local builder who does the same thing over and over. Prices are low enough that a mistake costs hundreds rather than thousands. The listed downside I've been given is that fees are small, maybe a few thousand, and that other wholesalers already mail those parcels because they're easy to find.

Case for rural acreage, 10 acres and up: fewer people mailing them, owners who genuinely forgot they own the land, and fees that can be five times bigger on one deal. Downsides look heavier. Access, water, septic suitability, and title that goes back further than anyone wants to read. Longer time to sell too.

What I can't work out is which set of problems a person with no deals should be learning on. Small lots teach you the process with cheap mistakes. Big tracts teach you the actual hard parts, and maybe learning process on parcels that don't have hard parts just delays the real education.

Define beginner however you want when you vote. I'm 40 hours into county assessor sites and zero letters mailed.

raj_mehta14 · Accepted Answer

I've been reading land material for months while mostly being confused, and the one distinction that finally made this question answerable for me is that size isn't the variable. Buyer depth is.

For a small infill lot in a town where three builders are actively putting up houses, you have a repeat buyer who prices in his sleep and closes on cash. Your job is finding a seller. For 20 rural acres, you have a scattered pool of individuals, a few splitters, and maybe a recreational buyer, and your job is finding a seller and then finding the one person who wants that exact tract. Two jobs, one of which you have no experience doing.

So the real question is what buyer pool exists where you're mailing. Go look before you filter by acreage. Pull closed vacant land sales in the county if your state publishes sale prices, and note that roughly a dozen states don't disclose them at all, in which case you're asking a land agent instead. Count how many small lot sales closed in the last 12 months versus how many 10 plus acre sales. If the lots move and the acreage sits, mail lots. If the county has almost no in-town vacant lots left, the question answers itself.

The cheap mistakes argument for infill is real. Earnest money on a 12,000 lot is a couple hundred dollars. But the title complications people warn about on acreage show up on old in-town lots too, and I'd rather learn to read a chain on something worth 12,000.

derekj19 · Answer

Not an investor, I look at this industry from the service side, and the thing that jumps out is that those are two different customers. The builder buying an infill lot calls you back the same afternoon because he needs inventory this quarter. The person buying 20 acres is buying a dream and takes four months. That difference alone would decide it for me.

dmitri_v6 · Answer

@vellum's point about the chain is the one I'd sign. Old town lots carry their own mess. Unpaid special assessments, a strip taken for road widening in the 1950s that nobody ever cleaned up in the description, sometimes a defunct plat. Small doesn't mean simple.

I'd add that whether a small lot is even buildable often comes down to a current setback and frontage ordinance rather than the zoning label, and that's a call to the county, not something you can filter in a spreadsheet.

aliyah_b · Answer

Cost side, since nobody's said it. Mailing 1,500 pieces costs about the same whether the parcels are half an acre or 40 acres. If your fee on the small lots is 3k and on acreage it's 15k, you need five times the deals to pay for the same campaign. That math pushed me toward acreage and I'm still not sure it should have.

marcus_hale41 · Answer

Voting mixed, and my reason is diligence load rather than fee size. Every rural tract I've looked at needed access confirmed, a septic suitability question answered, and a chain read further back than I wanted. That's three separate people to call on one parcel. On a serviced in-town lot the utility question is usually one call. As a beginner you can only carry so many open questions before you start guessing, and guessing is what actually costs money.

jordan_ellis2 · Answer

I've been at this six months with no deals, so take my vote as a warning rather than a recommendation. I picked 20 plus acres because the fees looked better and I've spent the entire time learning about surveys instead of talking to sellers. If I started again I'd mail whatever gets me on the phone with the most owners fastest.

devon_pierce · Answer

@pike that's the strongest argument in the thread and it's not really about acreage. First campaign is for learning to have the conversation. You want volume of seller calls, so mail whichever pool has more absentee owners in your target county, and in most places that's the small stuff because there's simply more of it.

Small in-town lots or big rural tracts for a first mail list

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