Swampland in Florida: 12 Things (2024) You Must Know

Have you ever heard the saying, “I have swampland in Florida to sell you”?

If so, you’re familiar with this phrase.

It means a scam in which the seller misrepresents unusable property.

Other phrases like “oceanfront property in Arizona” also describe these scams.

Here’s what you should know about this phrase and the scams it describes.

1. What is swampland in Florida?

“Swampland in Florida” is a figure of speech in real estate.

It refers to a scam in which a seller misrepresents unusable swampland as developable property.

These scams were first seen in the United States throughout the 1900s, and the usage of this phrase has expanded to explain any scam that misrepresents what is being sold.

For example, you may hear expressions like, “If you believe that, I have swampland in Florida to sell you.”

2. What is the background of the phrase?

This phrase originated in the U.S. during common land banking scams in the 1920s.

Today, it’s now a well-understood saying that’s used in other English-speaking countries.

The first swampland in Florida scheme occurred in 1925 by Charles Ponzi, an infamous con man whose last name is the namesake for the Ponzi scheme.

In September 1925, Ponzi established a real estate business to sell “prime” Florida property.

He purchased 100 acres of swampland east of Jacksonville for $16 an acre, which would be valued at roughly $250 an acre today.

He took this land and divided each acre into 23 subplots, advertised them as “prime” land, and sold them for $10 each.

Less than 6 months later, Ponzi was indicted for violating Florida’s trust and securities law.

He was found guilty and sentenced to a year of hard labor in a Florida State Prison.

However, he was soon freed on an appeal bond, and Ponzi attempted to escape to his homeland of Italy.

Unfortunately for him, he was captured and extradited to Massachusetts to serve his prison term until 1934.

He was deported to Italy and later immigrated to Brazil where he died pennilessly. 

3. What are land banking scams?

A land banking scheme should not be confused with the larger concept of land banking, which is a legitimate real estate practice.

A land banking scheme is when a scammer buys an undevelopable field on the edge of a village and subdivides it into “building plots.”

These plots are sold at prices way below the market rate for genuine building plots.

The sellers will claim that the land is likely to see a huge increase in value because it is zoned for development, even if this isn’t true.

Because it isn’t illegal to sell off small parcels of land, it can be difficult to stop land banking schemes.

This is a fraudulent act because the development potential (and the value) of the land is exaggerated.

If you want to protect yourself from land banking scams, then you should use the following tips.

bulletUse a real estate lawyer to handle land deals and don’t listen to pressure not to

bulletSeek advice from independent parties (i.e., someone not acting for the seller) when buying a building plot or development opportunity

bulletCheck with your local authority planning department about planning permissions as this can help determine the validity of the deal

4. What’s the actual value of swampland in Florida?

This popular phrase implies that swampland is entirely valueless. Is that the case?

Without development or the ability to develop swampland, it isn’t always valuable for resale purposes.

That said, you shouldn’t write it off entirely.

In the past, swampland has been purchased and turned into valuable property.

One key example of this is Walt Disney World as well as many other developed properties in Florida.

In addition, the property could have recreational value or may be needed by a developer to meet a permit requirement to preserve wetlands to build on other land in the state.

5. Do other similar phrases exist?

Yes, there are phrases akin to “swampland in Florida.”

These include “selling the Brooklyn Bridge”, “I have a bridge to sell” as well as “oceanfront property in Arizona” — which clearly doesn’t exist.

6. What were the Cape Coral and Golden Gate Estates scams?

Gulf American Land Corporation scammed several Florida real estate buyers in the 1960s and 1970s with swampland.

They advertised the properties nationwide as developable subdivisions to out-of-state buyers in Cape Coral and Golden Gate Estates, Florida.

When they arrived, the new owners found their land either underwater or unbuildable for some other reason.

This scam became widely known, and as a result, California and New York legislators restricted false advertising through a 1963 bill.

Later that year, Florida enacted the Installment Land Sales Act.

7. Do swampland sales still occur in Florida?

Yes, unfortunately, these scams still exist and involve unbuildable swampland advertised as prime property to inflate the sales price.

8. How do you avoid swampland in Florida sales?

If you’re worried about purchasing land, here are some tips that can help you avoid swampland in Florida-type scams.

bulletView the property before buying.

When you’re there, talk to the residents who live in the area.

bulletInvestigate the fees associated with the property.

These fees include real estate taxes and community assessment fees.

bulletMeet with a real estate agent.

They can help you discover the market for this type of property and how long it will take you to sell the property if you decide to resell it in the future.

bulletCheck with the county planning office.

They can tell you if there are any plans to develop the land near your potential plot in the future.

Depending on the potential developments, this can drastically impact your land value.

For example, if there’s an airport or waste management facility that will be near your property, you may want to reconsider.

bulletUnderstand the costs associated with the plot.

If the land is currently undeveloped entirely, research who will be responsible for the cost of building roads, utilities, and sewers.

You don’t want to get to your property and realize it isn’t reachable by any roads and doesn’t have access to water, utilities, or waste removal.

9. What is swampland in Arizona?

This is another variation of the phrase swampland in Florida that replaces Florida with the state of Arizona.

Because Arizona is known to have an arid climate, many people assume that wetlands in the state do not exist.

If someone were to believe they were buying “swampland in Arizona”, they would need to be much more gullible than the individual willing to buy swampland in Florida.

The phrase “oceanfront property in Arizona” follows a similar line of thinking because the state is landlocked and has no access to water.

10. What other land scams exist?

Other common land scams include desert land scams in Arizona and west Texas.

Scammers will sell these lots over the internet as sites of future development without disclosing that the properties are not accessible by road.

They also have no access to water and no sewer service.

11. What are the most common real estate scams?

bulletEscrow wire fraud

Scammers will claim to work with your title or escrow company and ask you to wire them your escrow funds.

bulletLoan flipping

This scam occurs when a predatory lender persuades a homeowner to repeatedly refinance their mortgage.

When they do this, they’re constantly borrowing more money.

bulletForeclosure relief

When homeowners get behind on mortgage payments, scammers will offer to provide foreclosure relief.

They have no intention to help the homeowner but are rather taking advantage of their vulnerability while collecting a large upfront fee.

bulletRental scams

Scammers post fake property rental ads on Craigslist or other social media sites.

They charge an application fee or deposit for clients to see the property in person even though they have no connection to the owner of the property.

12. What can you do if you’ve bought a dud plot?

Unfortunately, there’s very little you can do if you’ve been scammed.

There’s no compensation available, and it often doesn’t make sense to sue the seller because they’re not in that location long enough to go through the court process.

So be careful!

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Erika Gokce Capital

Disclaimer: we are not lawyers, accountants, or financial advisors and the information in this article is for informational purposes only. This article is based on our own research and experience and we do our best to keep it accurate and up-to-date, but it may contain errors. Please be sure to consult a legal or financial professional before making any investment decisions.


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