What is ‘Land Flip’
A fraudulent practice in the real estate business of selling undeveloped land at highly inflated prices. A land flip occurs when a group of dishonest buyers trades the land among its members, increasing the price with each transaction. The group will then finally unload the property onto an unsuspecting outside buyer at a price that the buyer will likely never be able to recoup from its own sale of the land.
Explaining ‘Land Flip’
Financial institutions face the risk of land flip with any loan made to purchase undeveloped property. They therefore take equity positions by investing directly in the land. Otherwise, they risk taking a loss if the land value decreases.
Further Reading
- The savings and loan debacle, financial crime, and the state – www.annualreviews.org [PDF]
- 'Like gold with yield': Evolving intersections between farmland and finance – www.tandfonline.com [PDF]
- Flip that house: visualising and analysing potential real estate property flipping transactions in a cold local housing market in the United States – www.tandfonline.com [PDF]
- Feasibility Study of Economics and Performance of Solar Photovoltaics at the Kerr McGee Site in Columbus, Mississippi. A Study Prepared in Partnership with the … – www.osti.gov [PDF]
- Land control and crop booms – www.tandfonline.com [PDF]
- The introduction of price signals into land use planning decision-making: a proposal – journals.sagepub.com [PDF]
