Real case study: How the Thompson family transformed 40 acres into a profitable rental property using Pine 2 modular homes.
The Thompson Family's 60-Day Transformation
When Mike and Sarah Thompson inherited 40 acres near Red Deer, Alberta, they saw opportunity where others might see just vacant land. Here's how they turned their inheritance into a thriving rental business in just 60 days.
The Challenge: Unused Land, Limited Budget
Starting Point:
- Property: 40 acres, 15 minutes from Red Deer
- Condition: Raw land with power to property line
- Budget: $400,000 available for development
- Goal: Generate rental income to pay property taxes and provide supplemental income
Traditional Construction Reality Check:
- Cost: $300,000+ per house
- Timeline: 12-18 months
- Capacity: Only 1 house within budget
- Risk: Weather delays, cost overruns, permit complications
The Modular Solution: Pine 2 Rental Units
Why Pine 2 Made Perfect Sense:
- Size: 504 sq ft with loft - perfect for couples and small families
- Cost: $179,000 per unit - budget for 2 units plus site development
- Speed: Factory construction while site prep happens simultaneously
- Quality: Consistent build quality and energy efficiency
Strategic Placement:
The Thompsons positioned the two Pine 2 units to maximize privacy while sharing utility infrastructure:
- Units placed 100 feet apart for privacy
- Shared well and septic system to reduce costs
- Each unit has dedicated parking and small yard area
- Maintained view corridors to surrounding countryside
The 60-Day Timeline Breakdown
Weeks 1-2: Planning and Permits
- Site survey and soil testing
- Building and septic permits submitted
- Utility connections planned
- Modular home orders placed with Discovery Homes
Weeks 3-4: Site Preparation
- Access road graded and graveled
- Excavation for foundations and septic
- Well drilling completed
- Electrical service installation
Weeks 5-6: Infrastructure Completion
- Concrete foundations poured and cured
- Septic system installed and tested
- Water and electrical connections ready
- Final permits and inspections
Weeks 7-8: Home Delivery and Setup
- Pine 2 units delivered and placed
- Utility connections completed
- Final inspections and occupancy permits
- Landscaping and finishing touches
The Financial Results
Total Investment:
- 2 Pine 2 Units: $358,000
- Site Development: $35,000 (road, utilities, septic)
- Permits and Fees: $7,000
- Total Investment: $400,000
Rental Income:
- Unit 1 Rent: $1,400/month
- Unit 2 Rent: $1,350/month
- Total Monthly Income: $2,750
- Annual Gross Income: $33,000
Operating Expenses (Annual):
- Property taxes: $3,200
- Insurance: $1,800
- Maintenance reserve: $2,000
- Total Expenses: $7,000
Net Results:
- Annual Net Income: $26,000
- ROI: 6.5% annually
- Cash Flow: $2,167/month positive
- Payback Period: 15.4 years
Unexpected Benefits
Property Value Increase:
A recent appraisal valued the improved property at $520,000 - an immediate $120,000 equity gain.
Expansion Opportunities:
Success with the first two units led to plans for Phase 2:
- Adding 2 more Pine 1 units in Year 2
- Targeting short-term vacation rental market
- Projected additional income: $18,000 annually
Personal Satisfaction:
"We're providing quality, affordable housing while building our family's financial future. The tenants love living here, and we love the passive income. It's been a win-win situation." - Sarah Thompson
Keys to Their Success
- Strategic Location: Close enough to Red Deer for commuters, far enough for rural appeal
- Quality Product: Pine 2 units attract and retain good tenants
- Efficient Development: Shared infrastructure maximized budget efficiency
- Professional Partnership: Discovery Homes handled permitting and delivery logistics
- Market Research: Confirmed rental demand before investing
Lessons for Other Landowners
Site Selection Criteria:
- Within 30 minutes of employment centers
- Good road access year-round
- Suitable for well and septic systems
- Zoning allows rental properties
Financial Planning Tips:
- Budget 10-15% contingency for unexpected costs
- Research local rental rates thoroughly
- Consider seasonal fluctuations in demand
- Plan for tenant turnover and vacancy periods
Timeline Expectations:
- Modular construction is faster, but site prep still takes time
- Permit processing varies by municipality
- Weather can still affect site work
- Plan for 60-90 days from start to rental income
Book a Consultation
Schedule a free consultation to explore how you can turn your land into income-generating rental property.