The Land Geek With Mark Podolsky

Wow.

You're not going to want to miss today's show with the land geek, Mark Podolsky. He's going to talk to you about his proven method about how to buy land and earn 300% returns. So whether you're just getting started or you're looking for a way to build up your passive income with a real estate strategy, stay tuned. Welcome to the Next Level Income show where it's our goal to raise your income, investments and your life to the next level. I'm your host, Chris Larsen. You can get your free copy of our book@nextlevelincome.com just click on the book link, put in your address, and I'll.

Even send you a copy for free.

Today's guest is known as the Land Geek. Mark Podolsky is widely considered to be the country's most trusted and foremost authority on buying and selling raw undeveloped land. Today, Mark will share his journey into the world of buying, selling and leasing raw land as an investment. He has actively invested in real estate and raw land for almost 20 years and has completed, listen this, over 6,000 unique transactions in that time.

Mark, welcome to the show.

Chris Larson, thank you so much for having me. I really appreciate it.

Absolutely. I'm really excited to have you on today, Mark, because as we were talking before the show, we talk about a lot of different types of investments, a lot of different types of real estate, but we haven't talked about just land yet on the show. Mark, I'd love for you to tell the audience why you're known as the land geek and kind of your history of how you got here.

Yeah, yeah. I mean, why I'm known as the land geek is I'm just really geeky and I love software.

Good company.

Yeah, I love software and automation. But the way I got involved with it was kind of a hazard. I was working as an investment banker doing mergers and acquisitions with private equity groups and I had a 45 commute to work and back. It was stressful, long hours. I was micromanaged. And Chris, it got so bad for me I wouldn't get the Sunday blues. Anticipating Monday coming around. I get the Friday blues, anticipating the weekend going by real fast and having to be back at work on. So my firm hires this guy and he's telling me that as a side hustle, he's going to tax deed auctions. He's buying up raw land tax and he's $he's flipping them online and he's making a 300% return on his investment. Well, I'm looking at companies all day long. And a Great company has 15% EBITDA margins or free cash flow. Average company is 10%. I'm looking at companies all day long, less than 10%. So of course I don't believe them. So we go to New Mexico. I do exactly what he tells me to do. I buy ten half acre parcels. An average price of $300 each. Three grand is all I started with. That's all I had saving for car repairs. And then I did, I flipped. I made an average of $1,200 each. It worked 3%. So I took all that money, went to another auction in Arizona where I live. Again, this is 2000 in the room. And I buy up lots in acreage for nothing. And over the next six months, I sold all that land. I made over $90,000 cash. So to my wife, I'm like, honey, I'm going to quit my job and become a full time land investor. And she's pregnant. She's like, absolutely not. So I said, okay, okay. So it took about 18 months, the land investing income to exceed the investment banking income. And I've been doing them ever since. I've done over 6,000 deals. I absolutely love it.

Outstanding. 6,000 deals since 2000. So you got me beat by, I think one year. I started in 99 with my first real estate deal, but I've not done 6,000 deals. So you got. That is.

Not yet.

Not yet.

Not yet. Yeah, yeah, we are on the way. Well, I want to dive into a bunch of different stuff, but this year marked the last year that I spent or the last year was really the last full year. But I left the corporate world myself this year to do real estate full time. And I love. Thank you. Thank you. And that's a big mission of the show is sharing information so others can do it. And my path, your path might not be someone else's path. So I guess talk a little bit more. You said it took you about a year to do that. I guess talk a little bit more about how long you were in the corporate space and just your mindset from leaving that and what really gave you the confidence over the course of that year or so.

Yeah, so I'd been working for that company for about five years. And I remember, I think it was in 99 that I read Rich Dad, Poor dad. And after reading that, the light bulb went off, like, oh my gosh, I need to do this. I can do this. I can buy assets. And it just kind of motivated me. And I remember having One foot in, one foot out, and thinking, okay, how can I do this? How can I work my land business full time and still keep all the benefits of my job? So I went there, I tried to negotiate a deal. I said, look, you know, I can do consulting for you guys, keep my health benefits. Like, look, you're all in or you're all out. And I was sick. I was so scared. I was so nervous. I was sick about it. I'm like, nope, I'm going to go for it. And I was all out. What I didn't realize was I looked at all the things I was going to be losing from the corporate gig. I was going to be losing as a steady, steady paycheck. I was losing my health benefits. I was going to be losing this sense of security, some identity, capital. I go to a party and say I'm an investment banker, but I didn't realize all the things I was going to gain and all the energy and enthusiasm I would have just for me in my business, I completely discounted until I started doing it. And like, oh my gosh, this is way, way better. I mean, colors are more vibrant, food tastes better. To be able to work, I want where I want, with whom I want. I didn't even know about how much better it would be. And yeah, in fact, I'm really proud of the fact I've had a similar conversation with a bunch of clients and friends who were on that surpass of should I quit? What advice do you have? I'm like, look, do it because you don't realize you're going to be able to put into your current gig right now to make that grow that you don't have the time for now.

Oh, it's so massive. And I feel like we could spend the whole show talking about this, but spend at least a few more minutes. A lot of my coaching clients are in a similar position as you were. Mark is in a similar position that I was over the past couple of years where they say, I like what I'm doing, but it's burning me out. I spent 18 years in the medical device industry, which my MBA is in portfolio management. So I spent a lot of time researching finance, investment banking. And I chose an area that I could blend my nerdiness, my geekiness in medical device and the body because I was a biomechanical engineer during. Well, I was undergrad for biomechanical engineering. And I thought, wow, what a cool space. But if you're listening and you're not one of my colleagues from the Medical device industry, you may not know this, but if you're a medical device rep, you're in the or you're on call, you're at the whim of the doctors in the hospital schedule, so they can call you out of bed at 11pm, which by the way, is the worst time to be called out of bed because then you're there all night. It's way better to be called at 3am in the morning. At least you get four hours of sleep, five hours of sleep, and it just wears you out. And I know investment banking is very similar. It's high stress. There's just a lot of pressure to perform on a day in, a day out basis. And I think if you're listening and you're in an industry like this, that's why I love real estate, because it's a nice complement that you can build up these passive income streams and these other options. But you mentioned one thing in there, Mark, that I'd like you to touch on. It was the identity. So I got to the point where my passive income, or our passive income with our family was at a great spot. I was also making some active income from some of our other deals. But what I figured out over the past six months was that that wasn't what was preventing me from leaving. It wasn't being scared of the financial part, it was being scared of being relevant every day.

Yeah, I mean, it is a real thing, right? And I think they called it an identity quake. When it's everything, your whole world is sort of shaken up and who you thought you were and the stories you told yourself is completely different now. And you have to sort of adjust kind of new reality and it takes some time and it's really scary to shed that. It's, in a way, it's almost like a death. And you know, unfortunately, a lot of people are afraid to go through it. But it's, you know, it's almost, I think of, you know, like, what is it? You know, like a chrysalis, right. You've got to struggle in. Right. And to get out of that and grow. And then all of a sudden you're this butterfly and you're flying. But you don't get to be that butterfly until you've gone through that struggle. And whether it's a psychological struggle or if it's a financial struggle or either way, it's. So for us, it was more psychological because we'd already had proof of concept that our real estate investing model worked for us. But we go through that struggle psychologically with identity, then now we're fine.

Yeah, no, absolutely. I think especially if you're in something that's high pressure, high need, you feel like people need you. And so if you're listening, I will tell you that I was scared to death three, six months ago to go through this process. But after doing it, I found it exactly what Mark said. You have this renewed energy. And I think it's an energy internally, but it's also an external energy. It's really interesting what happens and kind of the doors that start to open. So if you're going through that process, feel free to reach out to Mark or I. We'd love to, love to share some more on that. So let's dive into land versus real estate, Mark. So if you could kind of compare and contrast. So our specialty is multifamily syndications. So we're buying cash flow properties. We're controlling the appreciation on the way up, we're selling them on the way out. So some people that are familiar with what we do might hear you say, oh, I'm buying raw land, and be like, that sounds really risky. Tell us what the differences are. Positive and some of the potential downsides.

Well, I'm going to teach you now, Kris, exactly what I do. I'm going to walk you right through. So you live in Asheville, North Carolina, correct?

Absolutely.

I'm going to pretend that you owe $200 in back taxes on land in Texas. Let's say it's 10 acres. And then what I'm going to do.

I didn't know that, but okay.

Yeah. And then so what you're advertising to me are two important things. Number one, you have no emotional attachment to the raw land. You're in North Carolina, the property's in Texas. And number two, you're distressed in some weird way because we haven't paid your taxes and we don't pay for things. We don't value them in the same way. So what I'm going to do is send you an actual offer for your 10 acre property. Now, the way that I'm going to determine the offer is I'm going to look at the comparable sales near 10 acre parcel. I'm going to take the lowest comparable sale. Let's say it's 10 grand. I'm going to divide by four. That's going to give me what Warren Buffett would call a 300% margin of safety. I'm going to send you an actual offer of $2,500 contingent upon due diligence, taxes, et cetera. You accept it. Why? Because each month the county treasurer is sending you a notice saying, kris, you don't pay your property taxes, you're going to lose this property to a tax dean or tax deed investor. So for you, $2,500 is better than nothing. Now in reality, 3 to 5% of people accept my quote unquote top dollar offer. Yeah, but now that you've accepted it, I've got to go through due diligence or this in depth research. I got to confirm you still own the property. Back taxes are only $200. I have to make sure there's been no breaks in the chain of title. I have to make sure there's no liens or encumbrances. I want to make sure there's something compelling about the property, the access, like how far from services. What can I do out there? What are the restrictions? So I have this whole property report. Now I outsource that to my team in the Philippines. It costs about a bucks and they're connected to an American title company. In the same time. I'm getting the flat maps, aerial maps, GIS maps, everything that my new buyer is going to want to know as well. So I'm creating my marketing package. Now once that's done, everything checks out. I'm going to buy the property for you. Now because it's only $2,500, I'll self close and it won't go through a title company. But if it's 5,000 or more, I won't take that risk. I'm going to close through a title company. Now that I own the property, I'm going to sell it 30 days or less and I'm going to make a cash flow to just like one of your units. What am I going to do? I've got a built in best buyer. You know who it is? Don't know the neighbors. I'm going to send out neighbor letters saying hey, here's your opportunity. Protect your privacy, protect your views, know your neighbor. Oftentimes the neighbors will buy it. Now pass. I'll go to my buyers list. My buyers list passes. I'll go to a little website you've probably never heard of called craigslist, 10th most trafficked website in the United States. I'll go even smaller on Facebook, the marketplace and groups. And then I'll go to lands, landmodo.com, lands of America.com, landandfarm.com, landflip.com, landhub.com, all these platforms where people buy and sell raw land. Maybe I'll go to Zillow.com now. But the way that I can sell it so quickly is I'm going to make it irresistible to my next owner. I'm going to say, look, own this 10 acre parcel for $2,500 down and make it a car payment, let's say $449 a month and 9% interest over the next 84 months. Money out on the down payment. I might go six to 10 months out and then I'm making a car payment, 449amonth, 9% interest in the next 80. And Kris, I have no renters, no rehabs, no renovations, no rodents. And because I'm not dealing with a tenant, I'm exempt from Dodd Frank, RESPA and the SAFE act, all this owners real estate legislation. So the game we play is can we create enough of these land where our passive income exceeds our fixed expenses? And now we've not only just solved our money problems, we've solved our time problems and we have total freedom.

I love it. And you remind me of a strategy I read about when I was, I was starting my real estate career by Lonnie Scruggs and he, he said. Yeah, he was the mobile home guy, right? Yeah. I forget what his book was called.

But he said deals on Wheels.

Deals on Wheels, yes. Thank you. I had that little paperback book. Is he still alive, do you know?

No, he passed away. But I like his model. I don't love his model, but because you're still dealing with something physical. Sure, but with Lonnie.

Yeah, and Lonnie, owner, finance. Yeah. I saw him at a meeting and I swear he was like, he had to be 70 or 80 or 90 years old back then. That was 20 years ago. But he'd say buy wholesale finance retail. Exactly, that's what you're talking about. So if you're listening, catch that nugget that Mark just said Buy wholesale finance retail. I think that's phenomenal. And I love the part. I mean, frankly, after dealing with tenants for 21 years in some way, shape or form, I love the sound of not having to deal with tenants and having raw land.

Yeah. And then the geeky part of you is really going to like this because we've got 90% of the business automated with software on the front end, software on the back end called GeekPay IO. It's a set and forget it collection system where they make their down payment via credit card and then they collect h automatically. But if they're AC that does all the notifications and does all the accounting and everything. But then we also have inexpensive virtual assistants who are running the business. So I spent about an hour a week in the business managing it, just looking at numbers. So it's machine.

That's phenomenal. So you just taught us, Mark. And if you've checked out our website, nextlevelincome.com, our mission is to help people achieve financial independence through education and also through opportunities. But the education is something that we really connect on here. So share a little bit more with the audience about. They say, hey, well, that was really cool. What's your model for teaching others how to do this and how can people kind of learn the next steps with respect to that?

Yeah, I mean, the thing is, land is like the most boring niche in the world. So it's so unsexy. And you can go on HGTV or the DIY network and see flip this land. The before picture is raw land. The after picture is raw land. So there's sort of this, you got to turn your head around this whole model. And I think you'll agree the best way to learn anything is by doing it. So we have a $97. That's called wholetailing. How to double your money 30 days or less. I'd love to offer it to your listeners for free. And now you can start doing it, learning it at the same time. So just to go to landgeek.com quickbeat, they can really start taking action on it and see if this model even resonates with them. But I like to tell the multifamily people this great gateway drug into doing those bigger multifamily deals and build up your cash reserves, build up your confidence in real estate. I mean, I start with three grand. I've got clients who start with $500. So you don't need a lot of money to start. And then you can start building up your cash reserves, building up your cash, have that confidence to go into these bigger deals.

Yeah, I'm going to add that into the show notes. If you missed that link here, landgeek.com quickdeals is what Mark just said. I'm going to put that in there and I'm going to make sure that you can access it on our website as well. I get calls from new investors every day, Mark, and they say, hey, just yesterday, I'm 23 years old, I'm looking at buying this property here. Maybe I'm going to buy it there. What do you think? And I tell new investors typically a couple things and said, hey, you could buy a fix and flip that you live in, flip it in two years, double your money, tax free. Tremendous. Short term rentals are great. I know Phoenix is a pretty good market for that as well. Asheville's phenomenal for doing Airbnbs. This sounds like another fantastic opportunity for new or young investors that are trying to build up some of that cash war chest, if you will, to get going.

Yeah, no, absolutely. I mean, once you get to 10, 15, $20,000 a month in passive income, life becomes very.

Oh, yeah, absolutely. Absolutely. All right, so I like the concept. You listen, you say, hey, this is pretty cool. Two things I want to talk first about. Where in the United States do you do this? Where do you do this, Mark?

Right. I mean, Chris, let's face it, right? Nobody wakes up. Boy, I'd like some raw land. And Minnesota today, unless you live in Minnesota.

I got an aunt who lives there. She's the crazy aunt. She would tell you that herself. So.

So she lives there. She would want it. But the rest of the country doesn't want Minnesota land. But you know what they do want? They want Arizona, Nevada, Texas, New Mexico, Colorado, California, a little bit, Washington, Oregon. These are the fast growing states. And then we hit Florida. So it's not that I'm shying away from Tennessee or Arkansas, you know, Missouri, some of these beautiful rural areas in the Midwest. Oklahoma, I've done deals there as well. But the majority of our biggest buyer pool is going to be southwest a little bit in Northwest California and Florida, and that's really where we focus. Cool.

Now that makes perfect sense. I mean, aside from California, those are all markets that we're looking to invest in as well. Large growing markets where people are moving there.

Right, right, exactly.

Awesome. So, all right, so we talked about kind of like where, you know, where you would want to do this. We talked about some of the secrets about that. Any downsides with this? Any horror stories that you've seen or heard?

Yeah, I mean, it's kind of crazy, but no, I mean, the biggest problem you can get into is, is if you overpay, number one, if your response rate is over 5%, you should get nervous and you might want to renegotiate response rates under 3%. You need to raise your offer. So that's a good sort of important metric.

3 to 5%.

3 to 5%. And then one is, are there environmental issues? Well, we're buying in areas that have environmental issues, but if you're going to go Buy in Pennsylvania, Ohio, New Jersey, industrial areas. You have to go to epa.gov and make sure you're not buying a Superfund site because then you're responsible for multi million dollar cleanup. But other than that, if you follow the steps you do diligence, it's really hard to lose. I mean, it's crazy, but I've done this 6,000 times. I've never lost money. Raw land deal, that's phenomenal.

That's a phenomenal track record over 6,000 times so early in the conversation. Mark, this is a big thing I'm passionate about. You talked about 2000, you started doing this. I think that was a great point in the cycle. If you look at our traditional real estate cycle, it's like 18 to 19 years. So we're talking about being around the same point in the cycle today as you were when you started doing this. Any thoughts around that? About the shortage of land that we have, the housing stock shortage that we have going on now and why maybe one of the best times in history to be doing this.

Well, I mean, when your government is printing fiat money and throwing trillions of dollars in the economy, there is a flock to real assets. So whether it's raw land, real estate, gold, silver, bitcoin, you will see asset prices are just going to continue. So we had a huge Covid bump. I mean, it's terrible to say, but 2020 was our best year because of that. So I would predict we're going to continue to see asset prices rise. And I think that the cycles are getting more volatile so we don't see the little bumps like you would. There'll be like a little recession here and then we recover, recession there and recover. The next recession we have is going to be violent and severe. So I tell everyone a great cash flow management model is profit first and so be saving for that rainy day. And then like you'll say like the real estate cycle. Let's just compress it to 10. Two of those years you should be doing nothing with buying. Asset prices are low. Six of those years we got nice, equal, easy to buy, it's easy to sell. Two of those years you should be nothing but playing golf because asset prices are too high. We might be in that golf stage right now. We're still finding deals in raw land. But my friends and multifamily are complaining about these three caps. Four caps.

Yeah, it's getting harder and harder. And you're right. I think it's. We're at this point where you have to start, we're coming through more deals, tons and tons of deals. New markets going through those to find the deals that work. I think we got a couple more years left, personally, but if you saw me on the screen, I was nodding the entire time you were talking. I think it's a time that we're going to watch these asset prices go up. You got to be smart, got to look at what you're doing, and real assets make a lot of sense. Yeah.

I mean, Ray Dalio, the Bridgewater hedge fund manager, says cash is trash. So if you got a lot of cash, start deploying it.

Yeah, I stole Ray's tagline about the holy grail of investing. And that's my book subtitle, which is multifamily the Holy Grail of Real Estate. And I call it that because Ray Dalio says if you can increase returns and decrease risk, you found the holy grail of investing. So. So lots of great stuff, Mark. I've really enjoyed talking to a fellow geek here on the show. I love your title, the Land Geek. Again, we talked about how land can help you build your cash pile if you're getting into real estate initially, how it can be a great low risk way to go in and double, triple, quadruple your money. Mark shared some of his golden nuggets and he even offered his $97 course for free. So Mark, if you wouldn't mind circling back, what is the link to get that and what's the best way for people to get in touch with you, sir?

Yes, the best way to get in touch with me is thelandgeek.com they could also get the Kindle book for 99 cents, dirt rich. And then also the course is thelandgeek.com Quickdeals awesome, Mark.

Thank you so much for everything you're offering here to our audience, not only during the show but also in those resources. We'll make sure we link everything in the show notes. Probably going to put them on our resources page as well. And thank you so much. Stay warm out there in Phoenix.

Thanks, Chris. That's easy to do.

Hey Chris, here again. I hope you found this episode valuable. Now I have one more gift for you. If you haven't gotten my book Next Level Income yet and would like me to send it to you in the mail for free, then go to nextlevelincome.com and click on the Book tab. If you fill out the form on that page, I will send you a copy of my book and cover all the shipping costs. As a thank you for being a podcast listener. Also, please like share and take 90 seconds to give us a rating on Apple Podcast.