Welcome to Episode 1962 of the Land Academy Show with Steven Jack Butala and Jill DeWit! Today, they dive into the strategies and challenges of land investing in slow markets and reveal the truth about mailer competition. The episode also features questions from the Land Academy Discord Forum and exciting land acquisition showcases from their weekly Thursday member webinars, offering valuable insights for land investors. Don’t forget to like, subscribe, and engage in discussions within our vibrant Land Academy community!

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Listen to the podcast here

Land Investing In Slow Markets & Mailer Truth (LA 1962)

Introduction

This is episode 1962. We are talking about land investing in a low-growth real estate environment. Jill and I have been traveling all around the country this summer in our RV and it’s taking us to very rural places all over the place right now. We’re in the Rust Belt. It’s not what we’re used to in a real estate investment environment. It’s stagnant. Year over year, the price increases are not what we’re used to out west, so we’ll talk about that a little bit. Then a little later on in this episode, we’ll talk about the truth about mailer competition. It’s something that’s always in the back of everybody’s mind, I think. Am I the fourteenth person this month sending mail to the same area? We’ve got some good news for you there.

What was that? I got to pause for just a second. Like you said, in the Rust Belt. As you can see, if you’re watching us right now, we are still in our sweet RV, having the best time ever, I got to tell you. I want to hit it home again. You too can have a very successful land business from the road. It is not hard.

If anything, we’re out here finding new areas and it’s not just helping our psyche, which is great, but it’s helping us, I think, look at land deals differently sometimes too. One of the things that keeps coming up on our Thursday calls is everybody’s like, how much slope is too much slope? Every now and then we’re driving along and I’ll spot something and I’ll go, “Apparently, that’s not too much slope for those people.” You never know.

It’s all relative, but anyway, it’s fun to get your eyes on some of the areas and the type of properties that you’re buying. You don’t need to do this. We still really mean that you don’t need to go look at your property. That’s not at all what we’re doing, but getting out and enjoying it and seeing all this land, and by the way, this ties into our mailer competition thing. There’s still a lot of land out there. We two have driven through hours of vacant land in this country. There’s a lot. It’s really good. We’re clearly land people and I’m a land weirdo.

I wonder, we’re both entrepreneurs and obviously you are too probably if you’re listening to this. I wonder about other real estate people. Let’s say maybe a residential real estate agent or maybe a person who’s a CEO of a REIT, like an office building REIT. What happens to them when they’re driving around? Like, let’s say we’re in Northern Michigan because all we do is talk about land and real estate all the time. It really changes every little leg of this trip that we’re taking and really every trip that we take. I guess we’re doing the show right now. It changes how in some small way, how we send out mail and how we buy and sell land. I don’t know if an office building REIT manager would take a trip like this and have those thoughts. I don’t know.

That’s a very good question.

If you’re a natural-born entrepreneur, you’re going to have those thoughts anyway all the time. I wonder. Each week on the show we answer questions from our Land Academy member Discord forum. We review land acquisitions from our weekly member webinars and we take a deep dive into two land-related topics by popular request. I just mentioned those. If you want a sneak peek of our Discord forum go to LandAcademy.com. It’s free.

Full-Time Land Flipping

If you would like us to answer your question here, or just simply need some help getting involved in our community or learning more about Land Academy, just drop us a text at 480-530-7383. We do read all the texts and your question just might be answered on our next show. Here’s the question that Chris wrote. “I have a question for those of you who have been doing this for a while. If we’re selling our business and hoping to put most of the proceeds into land flipping. I also may have access to a limited amount of private money.

I’m hoping to do this full-time, but trying to plan realistically as I have to provide for a family. I understand that it will take, say, 6 to 8 months to start getting revenue from selling the land.” I think that’s too long, but we’ll get there. “I’m just wondering, what do you think would be realistic? If I need to pull in a salary of about $70,000 a year, what would be a reasonable amount of capital to start with? I intend on using deal funders, but may also be able to get some cheaper private money as well.” I just had a conversation about this.

Go ahead.

I don’t think 6 to 8 months as you got hung up somewhere for me, especially right now with the summertime and what we’re finding, what we’re buying, and what we’re selling. You could like not go nuts, and cash in, cash out. I’ll say 90 days. Let’s just say you take your time a little bit. This is my answer and I know you’re going to have a different answer here too in a minute Jack.

I sure am.

I know. If you need to pull in a salary of about $7,000 a year, all I keep thinking about is dear Samantha and what she shared with us on our member call. I don’t remember what it was. I think on a podcast, we did the podcast with Carl and Samantha a while back. In the first quarter of this year, she beat her old income from last year. I know people who are doing deals that, not just me, but do deals that bring in $70,000 a deal on the profit, not the deal. Say you’re not that comfortable and you do half of those, you do a deal a month and you make $30,000, that’s very doable.

This is a question I chose very carefully to include in this episode because I think it’s something that’s on everybody’s mind. There are 50 really topical points within this question that I think are super important in making a decision to buy a new company, sell a company, start buying and selling land on the side, or full-time or all of that.

Chris is right down the straight down the right path. He’s got a huge advantage that he’s already run a business. That’s a very positive step in the right direction. He understands payroll and making whatever they’re selling or making or whatever is part of the decision process. I do think that if you’re very early on in your career, and you’re young, you don’t have some of the issues that Chris might have. I’m not picking on him at all.

I’m just using it as an example so we all can learn. He needs $70,000 a year to keep his family fed in a roof over his head. If you don’t have that responsibility. You’re way, way, way further ahead. You can make that $70,000 a year easily turn it into a couple thousand dollars a month and be okay if you make the right decisions. I understand that he’s got fixed costs and has to deal with it.

If you don’t, more power to you. My point is, I’m not being negative. I’m really saying there are some huge advantages. Young people tend to think that they’re behind the eight ball that the world is passing them by and they cannot figure it out for some reason. We’ve run into a lot of young people on this trip and it’s just not the case. I think the world is you have a huge technological advantage over people, let’s say, Jill and I, and there are a lot of other advantages.

As far as capital is concerned, I don’t think you should even think about it at all. You need money to send mail out and you need to really spend some time educating yourself on being a fantastic, dynamic type personality salesperson to take the phone calls when people start calling back and to create your own real estate deals. I wouldn’t approach this from a money standpoint at all. We have all kinds of people in our group, Jill and I are at the top of the list, ready to fund your deals if you find great land. In 6 to 8 months, I think it takes longer than that.

To get revenue from the set really?

I think it takes probably 90 to 120 days to turn your first deal.

Thank you. That’s what I meant.

Whether or not that first deal is amazing and fantastic. That’s a function of how much you put into it. If you really spend some time learning and get a great mailer out price it correctly utilize all the resources that are here in Land Academy and align yourself in Discord, ask a ton of questions. I think it’s possible to really start to jam the pipeline full but I always err on the side of what’s probably going to take longer than that.

To end it on this, the best case scenario that you can possibly be in is to have a bit of capital if you actually need to have a salary which a lot of us do most of us do, put a bunch of money into a bank account, get your w2 rolling so you can pay your bills and then the money that’s leftover send out mail. If you have a bunch of money, use your own money to fund deals or use deal funding.

Land Investing In Slow Markets

This is a very very important question. I think it’s on everybody’s mind in some way pick costs versus long-term equity. The first topic is Land Investing in Low-growth Real Estate Environments. Like I said in the intro Jill, I’ve been traveling all over the country right now this summer with honestly no end in sight. How many months this is going to take? Come on.

I have to say, I literally came out this morning and Jack’s having coffee and I looked to him and I go, “We’re not going home are we?” He’s like, “I guess we could try it someday. Let’s see how long it goes until we cannot stand it and we have to leave again.”

I was thinking, because I have to a fault, a spreadsheet-driven brain. I started thinking, “I’m mentally drawing a line down the center of the paper, left side pros, right side cons.” What are the cons?

About going home?

No, just about what we’re doing.

Got it.

I came up with one, and that’s an unreliable internet connection. That’s like really only 20% of the time but during that 20% of the time, it’s not because of buying and selling land, like she said a million times. Nobody cares about that. You can figure that out on a cell phone connection. It’s this stuff. The cameras and the lights and the Land Academy are part of this. Hosting the Thursday call and now the Land Academy Pro office hours and eventually Career Path. When you don’t have a stable internet connection and you’re trying to run something like Career Path, it gets frustrating.

Then it gets tricky.

Outside of that, there’s nothing else on the sheet of paper. On the con side, it was all pros.

Isn’t that funny? That’s hilarious. I guess the only thing we got to do is like, “People need to start our cars at home. That’s about it. I got everything else locked down. That’s nice.” No. Are we saving money or what do you think? I just out of curiosity.

I think I don’t know. I could look at it. I don’t look at our person.

I think we’re saving money on the road too.

I never look at our personal stuff because that’s always covered. In fact, if you’re building your land business, that’s what you have to look forward to the personal expense. Our personal expenses are ridiculously low for how we live. The company stuff I always look at and it seems to be going okay.

This Came up for me. This topic hit me in the face like I don’t know what like a bird on a windshield.

That happened yesterday.

We were talking to your sister. I’m so used to living in areas where there’s a lot of economic growth and new companies and movement and like people leave one area they may leave a city and go somewhere else like during COVID and buy a bunch of lands and build their dream house thing but they still went to areas where there was growth and movement or if it wasn’t there they brought it. There were enough of them that it created it but there are still some places where it’s not happening and I’m a little bit perplexed. It’s so funny to me and this is a compliment to you. You obviously know it and see it and watch it all the time because we’re not mailing areas where this doesn’t come up. Any area where this is happening. It’s not where our mailers are going. Will you please explain more?

It occurred to me. This is now we’re into our second month of being on the road and we’re obviously talking to a lot of local people. We’re talking to people who are traveling around. We’re in northern Michigan right now and across all the states in between Arizona and northern Michigan to get here. We’re talking a lot of mix of local people and people that are traveling.

What I’ve noticed and I’m sure it’s something that’s been going on forever. I just noticed now how incredibly over-enthusiastic local people are about where they live. That’s happening. This happened with my sister.  She’s a very successful local real estate agent, a residential real estate agent in northern Michigan, really, really successful.

Like cannot go into a restaurant without somebody multiple people just know who she is and have to say hi. She’s very enthusiastic about where she lives. In the back of my mind, I’m listening to her and I’m thinking, “Wait a second.” It led to a conversation because she’s very in tune with real estate about how there’s just not any real serious growth.

When you buy a house 10 years later, it’s worth maybe 10% more, which in my mind, running the math real quick, maybe covers all the real estate costs of buying and selling it or maybe not. Certainly doesn’t cover the maintenance costs and all the other stuff. I look at it like you’re renting your own house.

Why would you do that? Then I’m thinking, I’m from Michigan, by the way. We’re in northern Michigan. The economy shuts down maybe 6 to 7 months out of the year because of the weather. You cannot build anything. That is a really huge problem for getting any type of labor at all because it’s seasonal.

If you are a person who wants to get a job and you’re only going to work half the year on construction or whatever else that’s a problem. It becomes an agricultural environment. I’m not picking on northern Michigan. It’s all kinds of places where the southwest has seasonal issues and all kinds of stuff, but if you are investing in a low-price growth area, you have to make doubly sure that you’re buying property really inexpensively.

If you are investing in a low-growth area, securing a very inexpensive property is crucial. Share on X

That’s the thing. Especially the last couple of years, it’s been really nice. There has been like pre-COVID, right? We had inventory, we had stuff in a property in our inventory. COVID hits. Remember it took a little dip but then all of a sudden everyone bananas and they’re moving and buying and doing that one, a bigger house and bigger land. I’m leaving the city for good now because I can.

For us as investors, some of my properties that were in inventory for a little bit of a while were worth even more. I’m like, “This is the greatest thing.” I’m I thought I might’ve been mad I didn’t sell it six months ago. Now I’m like, “Yey. I’m so happy I didn’t sell it six months ago because now it’s worth even more and people are scrambling for it and shucks. I wish I had more that I was sitting on.”

That has been what we’ve been dealing with and I’m used to it. Now it’s leveling off. Everything’s great. We’re getting back to normal somewhat. It’s still really great. It’s so interesting. The thing about these environments is that it’s so amazing to me like you just said. Here we were having this discussion in Jack’s sister’s kitchen the other morning drinking coffee. I’m like, “Why don’t these kids just do this? Why don’t they just buy a house and then live in it for whatever and then move out, rent it and get another house?” Nobody can afford to do that. I’m like, what are you talking about?

Jill and I were both baffled by this.

“What? What do you mean? Nobody knows.” I know. No, she’s like, “They’re never going to make that money. They’re not going to rent it for nothing. It’s not going to work.” I’m like, “What are you talking about? I just don’t get it.” To which I said, “You have a portfolio of a bunch of them.” She said, “Yes, and guess what? I built that portfolio in 2008, 2009, 2010. A lot of it was then is when we did it.” I’m like, “Oh.” They can pay cash for it. It’s a whole different situation.

Still doesn’t explain it.

I know, but I just, that’s the thing. I’m so used to looking at these homes there are some schmancy areas in Northern Michigan. I’m used to like, “If you buy something for a million, and then now it’s $1.6 million, and then you wait a little while and now it’s $1.8 million, and then now it’s $2 million.” They’re like, “No, it’s still a million.” I’m like, “I’m so confused by this.”

The conversation ended with her and with Jill and I. The final point was, that maybe somebody could enlighten me because I still don’t understand why. I don’t understand why you would remain in an environment like that.

That’s true.

There’s a whole big, beautiful country out there. We’re traveling around it literally right now. I don’t know why you would tie one hand behind your back from an economic prosperity standpoint and stick around in a very seasonable, I’m not going to say economically depressed area and shrug your shoulders and say, “That’s the way it is.”

You know what I would do? If I’m like some people we know who are hell-bent on living in a little bubble and they don’t care and they know it’s hard for other people to work and live and get jobs in schools and everything because their kids are grown, but they will need to be in this bubble. I get it. It’s a whole place where there is a caveat here. Buy your sweet place on the lake, spend what you want to spend knowing you’re never going to make money on it, or just If you do great, if not, have you break even that’s great.

I get that.

That’s all your thing. This is what I’m going to do and then I buy and sell property everywhere else because that’s where the money is. That’s the whole point.

I know you would.  That’s why we’re together, Jill.

Thank you. You can live wherever you want, but it’s hard for me to just even adapt to that because I need our primary residence. Like our primary residence, everything that we own goes up or we don’t buy it. I cannot buy it. You even take it to cars. He’s not nuts. We have cars that go up in value.

We don’t buy anything that’s durable like that. I’m not talking about a washing machine, but we don’t buy things like that that we don’t have a substantial equity position when we sign the acquisition paper. Maybe that’s just us. I’m not sure. I don’t know why you would put yourself at a disadvantage, knowingly put yourself at a disadvantage because you’re more comfortable. Not you. I’m not talking about you. I just mean people.

It’s amazing. It really is.

Please take all that into consideration. If you’re going to invest in low-growth real estate environments, Jill just actually described how it can work and how it should work. Low-growth real estate environments in some ways might be a better acquisition scenario because there are a lot of people who are realizing at a certain point when maybe they need money that the property is not going up. It’s just staying the same. I might as well just sell it.

Low-growth markets can be attractive for acquisitions as sellers, facing stagnant prices, may be more motivated to unload properties. Share on X

That’s true. It’s not. It’s not an investment anymore.

Juneau County Land Acquisition

Really make that work. Let’s take a look at one of our favorite land acquisitions from our weekly Thursday member webinar.

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Do this deal. County Wisconsin accepted the offer price of $4,546.25 cents. Thanks. We can sell it for $12,000. Your siblings own this property. Are you ready for the story? On the property, they live out of state and they inherited it. Zoned agricultural residential open space, 1.79 acres wooded. On the front, the east side of the slope is minutes from Castle Rock Lake. It’s a privately maintained physical road that spells HOA. If it’s privately maintained.

I don’t know about Wisconsin and HOA’s I don’t think that exists there.

I don’t know. The county says there’s an easement on the property to the east for the entire west 66 feet. Siblings are alive. Their mother is also on the property. The county says the sellers will need to sign a form of termination of deceased interest before the title can be conveyed. About half of the lots are built. Almost all unbuilt properties around it have out-of-state mailing addresses. How do I figure out a more accurate sales price? Is the termination of the deceased interest an issue? If it’s like a form that goes in addition to JTROS, or if it’s a form that takes the place of because there are three of them and that’s how they roll. I’m good with all that.

Again, my initial look at this is because if you do this, you cannot really see where the structures are. because there are so many trees. I’m doing this and see where these structures are. I can tell you that that’s good. It’s sort of passing the adjacent test, but not seriously. There’s a lot of dirt here, but some of us being developed, it’s got great proximity to this lake and it’s $4,000. Let’s see what the value is of this house on 8 acres. I would buy this and I would close on it and I would sell it for listed for probably $15,000. I would just forget about it and eventually, it’s going to sell. That would be my take on it.

Here’s the thing. It’s an HOA. I use the terminology. The county just says they don’t maintain Maple Drive. Good. It’s not privately, it’s maintained. It’s like you maintain your own road. Noted. I got it.

I’d buy it. Cheapest property in here, and this acreage is $12,000, and you’re buying it for one-third of that.

Whatever the county says, this is what we need for this deed. Fill this out, and we need the original death certificate, and we’ll send it back. I trust all of that. I’m totally good with that.

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I am so excited to announce and share that Career Paths 7 and 8 are open to the public. Just so, check out LandAcademy.com/CareerPath or just go to LandAcademy.com and then under programs, you’ll find Career Path. What’s a Career Path? It is our eight-week highest level personalized or taught by us via Zoom coaching sessions. It’s our mastermind, whatever you want to call it.

It’s the highest level of coaching that we offer. I do 2 or 3 a year, that’s all. We have released our last two sessions for 2023. That’s Curb Path 7 and Curb Path 8. One’s a Wednesday group and one is a Saturday group. The coolest thing is this is the first time that we’re doing this where we have them going concurrently and you can bounce around. I couldn’t make Wednesday, so I’m going to show up on Saturday or vice versa, or Wednesday was so amazing and intense.

I want to watch that and be a part of it again on Saturday. You can do that too. It’s going to be awesome. You do not have to be a current Land Academy member, by the way, but there is an application process. It takes five minutes to fill out and then you get a call scheduled. Go to LandAcademy.com. Again, look for programs and go down to Career Path. It’s awesome. I limit it to like 15 to 20 seats a group. It’s not a lot. Don’t wait until September 20 to do this.

Everybody knows that I always look at my glasses half full. This thing has created a life of its own, a Career Path. This is what the third year we’re doing it now?

Yeah.

Now it speaks for itself. I’ve never seen so many people sign up so quickly.

People come back.

Two months before the thing starts. I’m not selling anything. I’m just saying this is pretty popular now.

It is. It’s that great.

Prioritizing Revenue

Let’s take another question posted by one of our members on the Land Academy Discord online community. Again, if you want a sneak peek, go to LandAcademy.com. It’s free.

Sid wrote, “$100 an hour reminder.”

I love this.

“We all started outperforming all the minutiae tasks that make up the land business. It helps us understand the tasks but it takes up valuable time. I just had a friend tell me to tape a $100 bill to your computer monitor in an annoying visible place. If the task you’re performing is not making you $100 an hour, find someone else to do it.” I like that.

Sid was just a most recent career path person and he was very vocal and really involved and he does amazing stuff in Texas. We all learned from him and yet still learning here. I want to read between the lines here. If it’s not making you $100 an hour, so what he’s focusing on, and I’m really struggling with some people in our staff right now with this concept of staring at that $100 bill and seeing if it’s revenue.

Are you working on something that’s revenue-related? Here’s an example in your land business. Acquisitions. Acquisitions are like answering the phone, talking to somebody who’s a seller, and talking about the property. That is all revenue generating. It’s a revenue center. It’s not a cost center. I’ve been joking about this for over a decade.

Jill is the only woman I’ve ever known to be a revenue center, not a cost center. I don’t mean it’s not a gender thing. It’s just she’s the only person I’ve ever had a long-term relationship with who just holds her own and smashes it. From a business standpoint, you’re going to either work on something that’s generating money, and revenue, or you’re going to work on something that’s not.

It’s either a cost center or a revenue center. You want everything as a business owner to be a revenue center. Unfortunately, you’re going to have to find people to do the administrative stuff that is a cost center, make that insignificant in your decision-making process about what you work on every day, and make it cheap. If you can find somebody, that’s relatively disposable to do stuff that important and it’s not a profit center, you should do that. If it takes a taping or a $100 bill to your forehead, I would say do it.

Kids cost center. Let’s see.

Rent cost center. Avoid both of those things. Everything, there’s a way. It’s so easy to get just stripped up in a cost center. We are wired from the time that we go to school to just to deal with stuff that is so insignificant to what you really want to do. Right from kindergarten on. If you really look at your life and find out what’s a cost center, you’re going to be shocked because at your job, the only thing that’s a revenue center is showing up for work there.

When you’re showing up at work, you’re probably a cost center, not a revenue center.  Not good. Plus it’s a single point of failure. Then you’ve got all this other stuff that you’re responsible for from a cost standpoint. $100 reminder, Sid. I like it. He listens to the show. He’s one of 3 people that actually listen to this and watch this. Thank you, Sid. You made the show.

I wonder what speed. Are you at what 2.0 speed, what speed?

The Truth About Mailer Competition

The second topic is The Truth About Mailer Competition. This came up on a Thursday call yesterday. I like it when it comes up, the person says something to the tune of, “I’ve sent 10,000 mailers out. I’m not getting the response that I want.” That’s the short of it.

It was some other thing, too. I think that we uncovered while you’re doing it too. It’s good.

It prompted a conversation. We answered the question and we’ll certainly address it here in the topic, but it prompted a conversation after the Thursday webinar was over for Jill and I. I asked her this. Of all the pieces of property that we own around the country, I don’t know how many, it’s a lot that is for sale, obviously. Every month, how many letters do we get? As a seller, people are contacting us and sending out mailers because we own property there. We receive the letters to see if they want to buy it.

I’m going to give real numbers. At one point in time, I’ve got 100 to 200 properties in rotation right now. I get like 5 to 10. That’s it. A month. Then he goes, how many of those things ever come of it? I said this is a funny thing. I open them, I read them, I look at them, and some of the names I recognize. I’m like, “I’m going to sign this and send this back and see if anything ever happens.” 99% of the time crickets. I’m like, “I don’t think it’s me because there are people that I don’t know that I might send it back because sometimes they’re like, “This is a dumb offer.” Like if you want, like someone really priced it wrong and they send me an offer, I’m like. I know how I’m like.

It means it’s too high.

Yeah. I’m like, if you want it for that price, you could have it. I signed it and sent it back and they still don’t follow up. I’m like, there are times I’ve done, I’ve got automated. I’ve emailed it, but usually, I’m not going to mail it back. I’m usually going to sign it, scan it, and then email it to the person. That’s the most, right? Then I get automated replies, even email replies.

I’m like, so many people are dropping the ball. I had one guy for a while that I was actually working with. He clearly, unfortunately, did not know what he was doing. It’s like he just found offers to owners, sent out some offers, and had no idea what he was doing. He couldn’t even close on the deal. He didn’t know how to do his due diligence and even proceed and eventually backed out.

I’m like, “Thank goodness because I’m tired of helping you. You’re not even realizing this is a good deal. I don’t know what to do here.” Anyway, I felt bad for the person. Didn’t have any education like I said, winging it. The whole thing about this is it’s a lot less than what one would think it is, number one. Number two, most of the planet, just the people in our space, don’t know what and they don’t know how to take this all the way to the end.

There are a lot of things that go into as we know picking an area, pricing the mailer, getting it out. That’s one aspect. The second aspect we’re talking about here is knowing how to complete a deal, knowing how to talk to the sellers, answering the phones, working with them, getting them to want to sell to you, and then taking it all the way to selling it and doing it again.

I really think there are 10 steps to buying a piece of property we’ve talked about them 100 times. The critical step, the critical absolute imperative step, they’re all essential, but the imperative step is you creating a real estate transaction, not doing a real estate transaction, but actually creating one when their phone rings.

They might be livid and then Jill ends up buying their property or they might say, “Yeah, I want to do the deal.” Then just go through all the steps to actually create that real estate transaction. I also think that once in a while, and this happens to us once in a while, the seller will say, “I just got a letter from somebody else on this or I got a couple of letters this year on this.”

That’s not real competition at all. Think about real estate agents. There are something like 1.6 million real estate agents in this country. If you’ve ever been in a real estate office, they’re all in competition with each other. If they’re all sitting they’re vying for the same five listings that are going to come up in that market, and 1 or 2 people end up getting them because they’re they work at it like Jill does.

Here’s the truth. By the way, Jill and I, don’t have any secrets that make this successful. That’s what Land Academy is. We tell you everything. The only thing that we may have on you as a real estate investor, regardless of where you are in your career, is more transaction experience. That’s it and a really positive attitude. I don’t bring a positive attitude. Jill does.

Come on, sunshine. Don’t put yourself down like that.

Look, there’s not any real competition. Trust me. There are 150 million pieces of property out there. Everybody’s sending out 5,000 unit mailers and the vast majority of people are not following through as evidenced by what all the properties we own we just know they’re not following me through. If you want a competitive advantage, just follow through. Go through the education, get the mail out, use concierge data, or somebody like me as a partner. Answer the phone, answer your phone, check your email, and get really comfortable having conversations all the time with sellers until you’re selling a few properties.

I was talking to someone about today, there’s times that we’ve worked in counties and just found great pockets and had great experiences and we’re like, “We can hang out here for months.” I got so much stuff that came back and look how great this is. I got 6, or 9 months’ worth of deals right now that I gotta work through. This is great. I don’t even need to send more mail. We will. It’s silly not to, but it’s nice knowing that, “Look what I got to work through right now. This is great.” That’s where deal funding comes in. You don’t have to let any of them go. Just work them all.

Jill and I just spent several days with a bunch of my best friends from high school. They’re all guys, I think. Yeah. Believe me, I was the least intelligent and the least financially successful person in that room, give or take a couple of people. They all didn’t understand this business model until I said, “We’re creating a real estate deal that wasn’t there.” I get it.

That’s it. That was the light bulb moment. I love that. That’s true. Was that because it was on the MLS? What is it like? No, they didn’t. They knew they wanted to sell and then they got our offer and they decided they were going to sell.

Madison County Land Deal

Let’s take a look at another one of our favorite land acquisitions from our weekly Thursday member webinar.

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What is this deal? We’re Madison County, Alabama, accepted the offer price $45,000. Things we could sell for $100,000. 1.14 times 2 acres. I don’t know if that is.

We don’t know where this is.

Madison County, Alabama. We have access. Small acreage close to a big city. Everybody’s alive. Moderate slope with large rocks but plenty of land to build a sweet private house and shop close to Marina. By the way, you’re writing the description. This is awesome. I really like it. This needs to be the title and description. No way to a house is to the east or $600,000 to a million. Water and the fire hydrant at the access point.

All the houses on the hill are built on a steeper slope than this. Where’s access?

Yeah, because does it extend from that street?

I don’t believe that there’s access to this property.

I concur.

Super nice neighborhood. We need to know lots.

It’s two lots.

Good.

That’s it. Sorry. Yep. That’s the accents. I really like it.

Yeah, me too. Two APNs.

What’s this one? Are they both one by one? You get two acres.

This isn’t what you brag about this.

Yeah, I agree.

The houses are $200,000.

Is it $45,000?

For both.

What are the what’s the days on market in that area? People’s prop one-acre property with 100 days on the market is $65,000 with utilities, $100,000 for 1.7. These are $45,000 for both. It’s like $20,000 of property.

It’s really a 1, 2 acre property because we’re not going to give access through the middle of the living room.

Are you sure you cannot access like around here like this? Let’s look at it that way then 1, 2 acre.

It’s a 1, 2 acre property. Let’s really be honest here.

Three acres for a $100,000 price cut, price cut, price cut $50,000. Not a lot of cops. The last five-acre property sold for $80,000. We’re paying $45,000 for this. That’s way out here.

Look at this one. This one just sold in July, just a couple of weeks ago. It’s a big zip. Where are we? We’re right in town.

No, I wouldn’t subdivide. I wouldn’t mess with any of that.

Right here. These are all good comps. What’s going on with this property? Throwing it all off.

I wish there were $25,000.

So do I. That dirt’s great.

$20,000, $25,000 all day long. Beth, rhyme out, Eric. If you could have that conversation with them. I’ll give you the $20,000, $25,000.

It needs to be cheaper. You’re absolutely right.

Then I feel good about it. Even if things aren’t moving that fast in that area, I’m going to need to act fast because we are in Alabama. We’re south. One more thing. What are the home prices around there?

We just looked at these properties here.

This is the most expensive part of Alabama, then.

These properties are, this is $200,000. This is probably a more likely situation $400,000. It needs to be cheaper.

I think we’re going to sell it for $50,000.

That’s what I think too. That’s exactly what I think.

I would go back Eric, try to kill it. Try to kill it, go in hot, and talk. I’m sure you can expand them too. We all know it’s really 1, 2-acre property, not 2, because getting access to the back one is almost non-existent. There’s a reason why you bought it like that too, period. I would say the best I could do is $20,000. If it works great, I will open escrow tomorrow. If it doesn’t work, I totally understand and I wish you all the best. How long do they own it too, by the way, because that makes a difference sometimes. Can you look to toggle back? If you don’t mind.

Was it in an estate situation or in mixing them up?

Mixing them up.

It doesn’t say.

We don’t know. Since the ‘80s.

That’s good. I’ve got to get a better price.

We don’t know what they paid. Stuff happens.

My pricing using the term lightly algorithm failed us there. That just happens.

It was all in that same zip. On the North side of what it worked.

There’s no way you can. My point is that I make mistakes all the time. It wasn’t a mistake.

This was a little further out. We thought it was looking good too. Until we found out some of the nuances.

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Inspirational Closing

Jill, do you have something inspirational to share?

Yes. My comment is this. How well do you know yourself? Are you honest with yourself? Are you really the best person to answer the phone?

This is the thing that I get.

It’s a lot. You’re my case study.

How well do you know yourself? This is what happens when shows are not happy with me. Do yourself at all?

Do you know you’re even doing that? Do you know what havoc this is wreaking? Just kidding. That’s not it. You could be in a very positive way because you have things that you are amazing at that I suck at and we can turn but so, do you mind if I use you for this example?

I’ll have to be as you should. It’s all true.

Think about Jack’s voice, how Jack sounds, and the way he comes at things, and think about me. How would you react when he answers the phone versus when I answer the phone? You’re like, “Duh.” Actually, sometimes as simple as that. I have talked to people on the phone and I have to give them that little come to Jesus shake and say, “Stop answering the phone.” I have spoken to people who like to do all my own calls, I do all this stuff. I’m like, “How do you get a deal done because you sound like Eeyore? You sound like Eeyore on a bad day. It’s amazing to me.”

Eeyore on a bad day. That’s a bumper sticker.

I’m like, “Wow. They really wanted to sell.” It’s amazing because it really makes a difference and I’m not trying to pick on anyone, but you have to take a step back, and maybe listen to your own calls. I have it set up. You can record your calls on your cell phone. I know it. There are all kinds of apps that you can put on there and record your calls.

If you have not done that, you need to do that. If you’re not getting the response that you think you should be getting when sellers call you back, you need to A, listen to your own phone calls and B, maybe have somebody else listen to your phone calls and go, “Yeah.” I’ll listen to them or somebody like me. That’s what should be happening.

You need to be able to say, “Maybe I’m not the best person.” If you’re not getting the response to try something else, by the way. There are things that you can do yourself. Maybe you realize spot little tweaks like, “I was having a bad day there. I can clearly tell it was in my voice. That’s not how I normally sound. I can fix this.” There might be things that you can do that you can fix. There might be things that you cannot fix. If you’re not sure, turn it on to something else. Let somebody else answer your phone. The easiest thing, and it’s not expensive.

You can do a couple hundred bucks a month to get started and just figure it out. Bring in PatLive, as Land Academy members, you know PatLive and you have a great rate there. Use PatLive, see what the response is, and then make some decisions about it. The whole point here is to, there’s two points. 1) Figuring out if you’re the best person to answer the phone. 2) If you’re the owner, you shouldn’t be answering the phone anyway.

That’s what I think. Thank you.

If you cannot afford it yet, you’re still trying to learn, or you want to get to know the area a little bit, you’re just understanding some things, totally get that. Then you need to turn it off because like Sid’s question about the $100 thing, how much time are you bogged down in on the phones? I know I’ve done that. He’s done that. Jack’s done that. As a business owner, that’s not something you should be doing.

It’s like I have my own pizza joint. Should I be working the front counter? No, you’re off buying cheaper cheese. You should quickly be, maybe when you first open your pizza joint, you want to get to know the customers, make sure the right experience, and then you put people in place, and you put more people in place, put more people in place, keep working yourself up, so you’re only up here directing and doing the owner level stuff.

Which is nothing, which is looking at the money, making sure that everything is in its place but without detaching yourself so that when something does go wrong and it will, you cannot jump right back in and in direct traffic. Without involving yourself in actually solving it. That’s the ideal scenario. It doesn’t happen that way all the time. Jill’s absolutely right. It’s not just, are you the best person to answer the phone? It’s, are you the best person to get the mailer? Look again, this is 40 years now since I graduated from high school almost.

These people have all gone on to do amazing things. There are several people, a few people in that group that if they had to get back down and start digging ditches in their own company, they couldn’t do it. They’re so far removed. Some of these companies are so big. They’re so far removed from their reaction as well as let’s get somebody else to get somebody else in here. Let’s hire somebody to hire some other people to hire some people below them to fix this problem. I’m not advocating that at all and I’m sure you’re not either. You roll up your sleeves.

It’s funny you bring that up because you just talked about the people that are that we know that aren’t there that we think makes the most sense and we just met a phenomenal person for the very first time. It’s a friend of your sisters who runs a very successful nonprofit.  He’s the CFO and the COO and he’s like every now and then I get a call for the random things with parking lot issues. He’s like, “I obviously I’m not going to do it, but I know what to do.” He’s amazing. We just met this guy. I’m like, “We’d be friends if we lived here.”

It is about him too, specifically. You’ll probably never see the guy again, but it’s been a half-hour talking. He really enjoys the business season. He takes the community into his soul. He believes in it. I believe, too, that he’s providing this community-based service while he’s getting paid pretty well, I’m sure. I think he’s got a certain passion about it that’s not replaceable or it’d be very difficult to replace, let me put it that way. That’s the other thing too, I think.

Jill and I stare at the land through the windshield right now. Both of us are in awe, we never get tired of it and we never get tired of talking about it. We’re just land people. We just have a passion about it. I think you got to see what you have a passion about. If it’s land and money, then you’re in the right place. If it’s just money, this might not be the right place. I don’t know. I’m really serious.

That’s true.

You told me a long time ago. Never get into a business that you’re not passionate about. This is a person who just defaulted on a loan because he bought three oil-changing businesses and he liked money and didn’t care about changing oil, or car maintenance. That’s how it ended.

Never get into a business that you're not passionate about. Share on X

I agree. It’s not going to really work then. Jack, what have you got to share with us today?

I would like to talk about the role of AI in your land investment business. This came about for a couple of reasons. One, people in Discord are talking about it all over the place. Two and more importantly, since Jill and I started Land Academy at the live events and whatever I talked to people described the business most recently with these really successful high school friends of mine. Most of their reaction to what Jill and I do for a living is this.

There are 150 million pieces of property in the country that’s a finite data set. It’s not infinite, because I thought it was infinite until this conversation, because you just look around, and there’s so much land, but it really is a finite data set. Then why don’t you put this private equity group over here, get this data bank over here, set up a call center, do this, this, and this?

This is a way these ultra-successful people who have 20 or 30 years of business experience think to which I said, “You’re completely and totally forgetting one thing. There’s a person on the other end of that line. There’s a person on the phone that wants to sell their property to you. If you don’t engage them properly, it’s all the private equity capital, on all the people of PatLive type, people answering the phone aren’t going to help.”

I cannot count on both hands how many times people have come into our group, literally, assigned a deal with a private equity group, and try to automate this entire thing. Got banks of people, interns specifically in one case, and it all blew up in their faces. Why? We’re in the people business and they’re forgetting that personal point. Are you going to get some deals done that way? Sure.

You’re going to get a bunch of deals done that way. Is it sustainable? Probably not. Your mailer ratio is going to go to hell. You’re going to have to send out 30,000 letters to get one deal because nobody cares. That’s that one person out of 30,000 who doesn’t care how the person sounds on the other end of the phone. They just want their money and they want it fast.

Even then if somebody’s not addressing whatever because these are people. Is there a role for AI in this? Yes. Somebody went out recently, not recently, about eight months ago and automated the red green yellow test and found out that there are like nine places to send mail that are that rise above the rest of all the zip codes in the rest of the country. To which I said, “Great, now you’ve got these 10 zip codes. Congratulations.”

How many properties are in the data set that are rising to the top? Of course, it’s all the percentages are going to go to the tip-top. If there are three properties in the data set. I hope that’s clear. You don’t want that anyway. Everything that goes on in this is on Jill’s side. Jesus is really manual. Does that mean you’re not going to make $10 million a year? Absolutely not because we have people that have 1 or 2 employees that are in every single career path making $10 million a year, $6 million to $10 million a year with 1 or 2 people. This is not the way to make $150 million a year and they didn’t want to hear that.

I Hear you.

There are a lot of ways to make $150 million a year, and this is a net.

Do you have any use for AI right now?

Great question. AI, I think it’s really important to understand the definition of AI. There are if-then statements, and then there’s AI. AI, as I understand it, is Artificial Intelligence. It’s learning. It goes out, it has a massive data set, and then it learns. It doesn’t act. That’s probably because it begins as an if-then statement or answers a question, and it learns from it.

I needed to move the mechanical arm two millimeters to the right because it didn’t do what I wanted. Then at lightning speed, the speed of light. It’s learning. I’m not sure that’s what everybody says about the word AI. I don’t think that that’s actually what the strict definition is. Is there a role for ever-changing computer intelligence?

Yes, there is. Is it going to be in the form of sending more letters out? Probably. Is it going to be in the form of answering the phone effectively? Nope. You can send out 150 million letters pretty effectively, actually and you probably use AI to do it or some version of computer learning or computer intelligence. I was going to answer those fonts.

What phone banks do you need? A lot of 6 or 7 moving parts to this. No, Jill, I don’t think I’m with you this moment that there’s an AI application. Our entire career, Jill and I, as running Land Academy, specifically software developers have come in and automated pricing and automated the red, green, yellow test and automated the money piece and all of that, and none of them are with us anymore. They’ve all moved on to go do something else. What does that say?

Because it didn’t work?

Yeah. Maybe it worked. It didn’t achieve the results. Whatever they were trying to do. It was not as easy as they thought. It’s not just writing a program and spitting out $100 bills. I wish it was.

I see a huge awesome, positive benefit for AI if you’re in high school. Where was that during my senior paper time?

Everybody thinks AI is Chat GPT. I know it’s text. That’s what the whole world thinks of it. It’s automation. AI’s been in manufacturing for years and years and years and years. That’s where the real application is.

It’s funny. I really thought that by now, because this has been five or so years. I thought by now that every time I walked into a fast food environment, a robot would be doing it.

I agree.

Making my salad. That’s why I’m like, “Why did that not happen? I thought by now it was happening. It didn’t happen.” The pizza thing. That was definitely going to be a robot making your pizza, that was coming.

Why is that?

I don’t know. It works for whatever reason.

I think people need to have a social experience. I don’t want someone to throw a hamburger at me in a vending machine. I just don’t and I’m not a people person.

Maybe that taps into this whole thing, too. I guess you’re right. It has to be cost-effective. Come on, when you really add up salaries and benefits and all that stuff, there’s a cost-effectiveness that comes in there.

How many times do you call customer service and get sick of it after five seconds and press zero to talk to somebody 50 times until you get somebody? Every time, actually.

That’s true. This is interesting. This will be fun to watch. Everybody’s embracing it right now, but is it going to go away in six months? That could happen. Don’t forget. You can reach us for questions and help just by texting 480-530-7383.

Join us next Wednesday for another interesting episode. You are not alone in your real estate admission. We are Jack and Jill, information and inspiration to buy undervalued property.

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