What Is Drop Flipping? Land-Home Packages Explained

By Mike DeHaan, Dan Austin, Dylan Koch · November 3, 2026

Flipping existing houses got harder this year. Days on market stretched, inspection reports got picked apart, and buyers kept falling out of contract the week of closing. On Episode 516 of Collecting Keys, Dan Austin and Dylan Koch talk with Aaron Bihl about a different approach he calls "drop flipping" — buying rural lots, setting brand new manufactured homes on them, and selling the land and home together as real property. Aaron says after doing one, he decided he was never flipping a house again.

What is drop flipping and how is it different from a regular flip?

"Drop flipping" is Aaron's rebrand of what the manufactured housing world calls a land-home package. You buy a lot, put in the infrastructure — septic, well, foundation, permitting — set a new manufactured home on it, and sell the whole thing as one real property transaction.

The home is detitled and converted to real property. Aaron explains that you retire the title, and the end buyer gets a normal loan — most of his buyers use low-down-payment FHA, USDA or VA financing. From the buyer's side, it functions just like a house, not a bill-of-sale mobile home purchase.

His case for it over flipping: more scalable, more predictable, and you rarely blow the budget because the due diligence happens on the front end. It can also be run remotely. Once you have crews in an area, Aaron says, you don't need to go see the sites.

On geography, Aaron told Dylan these are rural deals — you're not doing them inside a dense city like Cincinnati, but outside Cincinnati or Columbus it probably works. He says operators in Washington state, Arizona and the Northeast sell these for well over 300, and pay more going in. The pitch to the end buyer is price versus new construction, plus land.

Where does the margin come from, and what site work bites you?

Aaron says the biggest place to add value is getting really good deals on lots. That's the same sourcing muscle most investors already have, pointed at a different asset.

The second lever is the home itself. Aaron holds a dealer's license in two states, which lets him go directly to the factory and buy at wholesale pricing. He says requirements vary a lot: in Georgia it's essentially pay a fee and sign up, in Tennessee he took a class and a test, and some states require an in-person class, a test, two or three years of experience, audited financials, and an actual lot with inventory. In those places, he says, it just doesn't make sense.

Dan brought up a company in his market that started as a dealer, owns the moving equipment, buys land, sets the home and sells the package. Aaron said he has no interest in building out land clearing, septic or well companies himself — he'd rather contract the trades and focus on lots.

On surprises, Aaron said septic hasn't shocked him, but wells are the line item he's most cautious about. You pay based on how far they dig, and nobody knows the depth until they hit water, which is why he said he probably wouldn't touch a Tennessee lot that needs one. Perk tests, permitting and foundation types all vary by state, and Dylan added that septic cost varies dramatically county to county in Ohio depending on the local regulatory process.

Aaron's other argument for new product is inspections. He described a flip where buyers demanded foundation work, and even after he paid about $500 for a foundation engineer to say it was fine, the buyers still didn't accept it.

What are buyers and sellers doing in this market right now?

Dylan has three flips sitting on market past ninety days. Aaron said his sales have been random — properties he expects to move sit, and ones he doesn't expect get decent offers. He doesn't think price is the blocker, because buyers aren't complaining about price, they're just not buying. He also said finances are shaky: deals have died the week of closing over small new purchases.

Dylan shared a tactic that worked. After a contract fell through and price drops didn't help, he pulled the listing for about two weeks, put a little more money into the house and relisted. Days on market reset and showings picked back up even though almost nothing had changed. Both agreed going back to earlier interested buyers rarely works — they've already bought something else.

Dylan also raised a live problem: a seller refusing a second access for the buyer's appraiser on a four-unit, despite the contract allowing it. Aaron's advice was to pay the seller a little more to make it easy — he once resolved a similar standoff for about $100. He added that he'll sometimes take a smaller assignment fee if the buyer is using a hard money lender he knows closes cleanly.

On financing, Dan said the lowest hard money pricing right now is probably around 10% and one point from the biggest lenders, with extra fees, a required down payment, an appraisal or inspection, and a 700-plus credit score. His broader point: on short-duration loans, lenders care far more about the deal and the borrower's experience than an eighth of a point on rate.

• Dylan's auction underwriting: ten four-unit buildings, 40 one-bedroom units, about 600 square feet each, 82% occupied, all on separate parcels.
• Valued on NOI and cap rate he puts it around $2.2 to $2.3 million; sold off individually to owner-occupants and house hackers, closer to $2.65 million.
• Bids are non-contingent and he could only tour the vacant units — eight independent tours were scheduled.

The through-line of Episode 516: when resale flipping gets slow and inspection-heavy, experienced operators look for product with fewer unknowns and fewer objections. Listen to the full episode for Aaron's state-by-state dealer licensing detail and Dylan's live auction math.

Land & Mobile HomesHouse Flipping

Educational content from the Collecting Keys podcast. Not financial, legal or tax advice.