The Land Method: How to Evaluate, Buy, and Profit From Vacant Land with Jonathan Haveles

Hello everybody. Welcome to the Raise Capital Legally podcast and YouTube channel, your go-to source for insights on raising capital the right way. The purpose of these recordings is to dive deep into topics that matter most to real estate syndicators and fund managers. I'm attorney Kim Lisa Taylor, the founder of syndicationattorneys.com. Before we get Started, please note that audio and video from this event will be posted on our podcast platform, YouTube channel, website, and social media, and will be made available to the public. If you do have any questions, sometimes we do these live with an audience. Today we are just doing the recording, but when we post it on YouTube, we would welcome your questions or comments. And if there are things that you want to ask Jonathan, we're going to give you his contact information at the end of the call. So you'll have ways to contact us if you'd like to ask us something direct, or feel free to post something on our YouTube channel. That would be lovely. All right. So information discussed during this event is of a general educational nature and should not be construed as legal advice. So today we are talking about the LAND Method, how to evaluate, buy, and profit from vacant land with Jonathan Havalez. So I'm just going to read the episode description just for our intro. Vacant land offers a very different real estate model. No tenants, renovations, or late-night maintenance calls, but plenty of opportunities for costly mistakes when pricing, access, zoning, buyer demand, and exit strategies are misunderstood. In this episode, I, Attorney Kim Lisa Taylor, is sitting down with Jonathan Havalez, co-founder of The LAND Method, to explore how investors select promising markets, locate motivated sellers, value vacant land, conduct proper due diligence, and choose the right exit strategy. Jonathan explains the differences between cash flips, owner financing, subdivision, and development while sharing lessons from more than a We're also going to be discussing how beginners can approach this investment strategy as a real business rather than a get-rich-quick opportunity. Jonathan has focused primarily on land investing since 2012 and completed more than 1,000 vacant land transactions, including flips, owner-financed sales, subdivisions, and development.

Hi, Kim.

Wow. He's done a lot. I had an opportunity to have a call with Jonathan. He reached out to us and as I was talking to him about his business, I was just fascinated with the amount of things that he had done. And I just really thought about the fact that we really never have talked to anybody who's in the land business before about how this unique asset class actually works. So Jonathan, welcome to our show. Thank you so much for being a guest.

Thank you.

Thanks for having me. Yeah, super happy to have you here. So we always like to start with having you tell us a little bit about your background and what ultimately led you to focus on vacant land as an investing model.

So I've basically been in real estate my entire adult life. Came out of high school and my dad was a real estate agent and I was interested in it, got into it. So I started Like everybody else, got my license, or maybe not like everybody else, but that's where I started. I started with getting my license and just doing residential sales and focusing on that. And then I was in Florida at that time and 2008 hit pretty hard. We had just started investing at that point. I, and the reason I got into investing was honestly because I was working as an agent and I was handling investor transactions and I'm like, They're making all the money in this deal and I'm doing all the work. So I'm like, why don't I do the work and make the money? So I was like, I'm going to start doing investing myself. And so we started doing that. Unfortunately, the timing, we didn't really lose anything, but it never really got taken off the way we wanted because of what the timing was with coming out of or going into that recession. So we ended up doing some fix and flips and REO sales, short sale flips, things like that. During all of that, I started getting into commercial real estate. I went through all the CCIM things. In fact, that's where I met Kim 20 years ago, I think roughly at a workshop. And then we, I reached back and reconnected a few months ago, but originally it was at one of those workshops because of that. And then my father was always fascinated with land and he did like some subdividing and did some stuff in the '70s and '80s. And in 2010, 10, 11-ish, he basically said we should be looking at land again. And so we did. And so it was basically just going to be like a little add-on because it was something he knew and it wasn't a market a lot of people were doing, like you said. And it just took off right around that time. It went well for us. We made basically equal money to what we were making in our regular investing business with a lot less time. It was just a little side hustle to add to it. And it was like, why aren't we putting more time and effort into this just because of how much— I'll get into that, but how much less work time is involved in each transaction. And so we just rolled with it from then and it's been a great deal. It doesn't mean that's the only thing I do, obviously. The fact that I'm here, there's other parts that Kim and I were just talking about, some deals that we're working on in other sectors. I don't believe in putting all of your eggs in one basket, even in real estate. It's like you've got to diversify. But I do believe land is an area that a lot of people are overlooking and there's a lot of Major benefits to it that aren't necessarily in other real estate, or if they are, it's only because you got fortunate, not because it's the day-to-day way it works.

And it seems like it's a lot less labor intensive once you find a good piece of land. You don't have to manage tenants, you don't have to manage maintenance on buildings, all those things. So if you can find a way to make that profitable, then why not? Okay, so what do you think makes vacant land different from other types of real estate investing?

It's really a flip in how it's done. A lot of real estate investing, everything's done on the backside of it. So meaning you're buying, you're doing due diligence obviously, but it's about the structure, it's about the sales, it's all about the numbers on that side of things. What can I get out of this? If it's commercial, like we've talked, what's the NOI on it? What's it going to produce? What's the projections? All of these different things. Obviously you still have to buy right and you're still doing due diligence. With land, a lot of it is on the front end. It's really all about buying, all about the, when you're buying it and looking at things ahead of time. Now, what it does allow to me that's different than others is one is the returns on invest— immediate return on investment. So we've got ones right now that we're buying and selling and we're basically going to double our money on that piece of property immediately. Which, I mean, doubling your money's a good thing, but a lot of times it's years down the road, right? It's, or you're putting something into it, or it's a cash flow situation to double your money and then the sale in 3 years or 5 years or whenever it may be. This is more of just flipping, but in the land space. And people that do houses obviously do that too, but they're not usually buying a house for $200,000 and selling it for $400,000 immediately, right? They're making a quick little assignment fee, wholesale fee, Or if they are flipping it, if they're putting a lot into it in order to do it, or they're going to be doing some major rehabs, some major repairs, whatever it may be, and that's going to allow them to make that income. And so there's a lot of time involved where obviously it's vacant land, we're not doing anything to it. There are values there, which you can talk about, value-add plays that make it even better. We'll talk about that. But just in general, you can still do it without really doing anything, just finding deals. And the other thing that is really interesting to me about it is I know people talk about get involved with real estate with none of your own money and all of that. And there, there's obviously ways to do that. When it comes to vacant land though, it's actually pretty true that you not need none, but you can do very small deals to get going. And we've helped a lot of people do that that are just too nervous in real estate. They're worried about losing it. Even if the numbers are great, they're still just nervous because they've never done real estate before, real estate investing, and they're just too standoffish. Oh no, standoffish. This could be a bad— Negative situation. I could lose everything. Well, people feel that way when it's $50,000, $100,000, right? When it's $2,000 to buy a piece of property, because those do exist for land, that, that comes down, the guard comes down, and all of a sudden they're not so concerned. And so you're buying a piece of property for a couple thousand and you're doubling your money, or you're owner financing it and you're making 4 or 5 times your money by the time it's done. People all of a sudden don't mind that as much. I had one student I worked with a number of years ago. They were just so scared of losing everything. We just put them into small deals. They did a handful of them and they just blew up from there. They were so excited. They were like, oh, all I'm doing with these larger deals is adding a zero. That's it. It's the same work. And I'm like, but they had to get that out of their, get their mindset right. And land offers that. Houses offer that to some extent, but you've got to go find really cheap, bad neighborhoods that you can still buy a house for $20,000. And it's just not necessarily an area you want to be. Whereas land, you remove those barriers. And so a lot of people, that does help them. And to be honest, we still do deals in those markets, not because the money's great, but because it's so easy to owner finance them. And all of a sudden you can create $10,000 or something in cash flow every month from a handful of properties. And you just have them out there and it's really nothing into them in order to do that. So it is something that helps a lot of people.

So I'm just trying to visualize in my mind, and I'm sure a lot of our audience is wondering, okay, yeah, sign me up. How do I immediately, you know, double my income or double my investment? And so it sounds to me like the strategy that you are talking about, at least in that case, was get the property under contract, then go find a buyer, and then, you do either a simultaneous close or close, sell it immediately after you buy it. Is that the right description?

Yeah. So we evaluate every property case by case to see, does it make sense to buy this straight out? Does it make sense to play the double closing? Do we want to get a partner involved? Because the bottom line is, even with anything, it's after you have a handful, you can only tie up so much of your own money, right? So you've got to figure out something. So do we want to get somebody else involved? How do we want to do it? In a lot of cases, we are getting a buyer lined up immediately. It's, we've got to, we market it out there and we see what happens. And a lot of it's just like anything else. You're trying to find the right type of seller. So if you're finding the right type of seller, we got a couple properties right now, just for example with this, that are offering us that potential. One of them was inherited. The man's dad bought it. He's been dead for a number of years. He's been paying taxes on it. He literally said, I've never seen the property. He doesn't want it. It doesn't interest him. And so he was willing to sell it at a discounted price. We had another guy that did. He loved his property, loved it dearly, wanted to build his dream house on it. His wife got sick. Unfortunately, she passed away. That changed his entire mindset on that piece of property because it was their dream. And now he's, I don't ever, never want to use it again. And I'm not saying we're not trying to, we don't know these things going in. They tell us these stories after they're Writing the contracts and things where we're making these offers. But just like anything else, finding the right type of seller that's motivated, and there's 1,000 different reasons. I just gave you 2 little examples of why that's the case. We find these things, we get 'em at a lower end of market type of— now we're not offering somebody $5,000 on a $100,000 piece of property, but we're doing it enough where there's enough spread there that it obviously makes sense. And the higher the value goes of the property, the larger the numbers can become, right? Because obviously, if a property's worth $500,000, you could be— and legitimately worth that, and that's what they're selling for, and you're offering them $400,000 because that's a $100,000 payday where they're still satisfied, they're still happy, they're happy with the way things are going, and then we're finding the buyer and all of that. And so there's just so much potential as it goes up. One of the things that we talk about when we teach this is On higher dollar values, we look at the spread. How much are we making between the 2 numbers? On lower dollar values, we focus on the ratio. How much turnover? What's our return on investment going to be in that? Because obviously, you're not going to buy a property for $2,000 and make $100,000 on it. It's not going to happen, right? But if you buy a property for $2,000 and it turns into, say, $15,000 with owner financing, you just made over 7 times your money. You have a huge investment return on investment. And so that's where those come into play.

So it sounds like you're looking at creative financing both on the buy side and then also on the sell side and using that sell-side creative financing for the next buyer as a way to increase your return on investment. Is that right?

We don't so much. We do have people that do that on the sell side— on the buy side, I'm sorry. On the sell side, absolutely. On the buy side, we don't do it so much. Ours, We focus more, if we're looking at financing, looking at the numbers and making sure they make sense and get more into joint ventures with people where we just put up the money to buy it and they get a portion of the sale or a flat interest rate or whatever. So some creative financing there. There are people I know that will do, that'll go into that, that do this and will go and get a loan from a hard money person and it's at X percent. Because they're very confident in their numbers. And that's the key. We tell people that all the time. There's no necessarily right or wrong way. It's knowing your numbers. Because obviously, if you're buying a piece of property for $100,000 and it happens to be worth $250,000 and you know you can move it quickly, but you don't have $100,000, absolutely, go get the hard money loan. Because if you're going to move it in 2 months, you're much better off giving up that little percentage than going into a JV with somebody and giving up a big chunk of the deal or a bigger piece of the deal. For it. So you just got to know your numbers very clearly so that you can identify what the best way is. And what we tell people honestly upfront is if you're not sure and you're building your skills, just like anything else, don't jump in the deep end right away. Focus on what you said, the double closings and things like that. You know, just focus on what's simple for the transactions. Get some capital, get some money, get some skills from it, and then focus on the other thing. Now, your audience is a little bit more sophisticated, and so this probably all makes sense to them. But in a lot of cases, it's people that are literally like— I had a student that literally came to me and he said, I don't even know what a deed is. That's what he said. I don't know what a deed is. He says, but I know real estate investing is good. He said, so I want to learn about it. And he's done phenomenal. He's making 7 figures a year now in land. But he— this was 10 years ago when he came to me and said that. But he was a smart businessman but didn't understand real estate.

And And so let me ask you this, because I've gone to a whole lot of real estate training classes over the years for all different kinds of asset classes. And there's always like that one thing, like if this just one magical thing happens, then the whole thing works beautifully. And is that magical thing something that, you know, I as a student or listeners can actually do? And so to me, this magic thing is how do you find these buyers? How do you know that what you're buying is something somebody else wants if it's already been sitting there for months? Maybe it's even already been on the market. How do you know you're going to be able to find a buyer? What do you— how do you do that?

So we always— so 2 things. One, we don't go after on-market deals. It's off-market. These are off-market deals just like anything else. So don't get me wrong, sometimes we do get on-market deals. We don't go after them. We find out from our marketing that they're on market. And it's funny because some of those people are just upset with their real estate agents and they're like, they have it priced too high and I'll sell to you. And it's like, we're not even anywhere close to what the agent's asking, but they're just so tired and done with it. I've had it out there for 2 years with my agent and they haven't done a thing. And, but that's rare. The vast majority of them are off market. And then we do our, when we do our area selection upfront, that's a huge point. We have to see movement in the area and we want to see it on both ends. We want to see properties that are listed for sale. And we want to see properties sell that are listed because we don't want to be focusing. You go into an area and let's just say you use Zillow because everybody's familiar with that. You go into Zillow and you put in like the county that you're looking at and you put in land for sale and you see a million red dots. It's like, oh great, there's so many properties for sale. Then you flip it to sold and there's zero or just sporadic people aren't buying, right? So it has to, you have to see people actually buying properties there. Because if they're not, then it— and conversely, you don't want the other way either. You don't want it to be a few little red dots and then a bunch of yellow, because that means it's an insanely saturated hot market. Everything that's listing is selling immediately. And because of that, people— most of those sellers understand that means premium pricing. There's no reason to give you a discount. There's some don't, but the vast majority do. And so you gotta— it's just gotta be balanced where You have to understand, hey, I want to see movement. I also want to see listings out there. I want to see a nice correlation between them because then I know people are actually looking there, but it isn't so saturated or so over the top that I'm never going to get a deal.

Yeah. Okay. That, that's very insightful. And because I do think that's always, okay, I know how to find this, but I don't know how to sell it. So what means, how am I going to be in a different position than that seller was? If I can't find a buyer. And so I think you have to have that understanding and certainty that, hey, it is a market where you're going to be able to find a buyer and it's not going to be that hard. And like you said, having a really good idea of what things are selling for, not just what they're listed for, what they're actually selling for, so that you know what you're offering is viable and profitable. Yeah.

And even when it's what they're selling for, we still build in a little bit below that because we want to be the one that moves. We don't want to have it sitting there. So we've got an area now that we've got properties where there's 8 properties. They're all listed at the exact same price. We looked and a couple have sold, but it took forever to sell them. And so we can sell them for that, but it's not going to— so what do we do? What pricing do we at to actually get movement on ours? And then we can build our deal with our seller and everything based on that. So we look at all of that in advance. And then it's nice because then when we have ours out there, All those other ones that are listed higher are basically marketing for us because it's, hey, look at— there's 8 of them at this price, but this is $50,000 less. Why is this $50,000? Is there something wrong with it? And then of course they're going to click on it to see, and then they realize it's exactly the same. It's why— look at— why are we even bothering looking at this one if I can save $50,000? But I go— and that's happened to us many times where it's like, I was looking at this property and agents have gotten upset. Why are you undercutting? It's like, because you're not moving it. You were smart. You tell your sellers, let's lower the price. But it's like, yeah.

I get that. We have, my husband and I have some rental properties and some of 'em we do midterm rentals on. And his philosophy has always been, I'm slightly below market. And the reason for that is because if this property sits vacant for a month, I've, maybe I could have gotten a higher couple hundred dollars more a month if I'd left it out at a higher price. But within a month that's gone, that entire profit is gone for the whole year. So if I just list it for a couple hundred dollars less, then I've gotta rent it out every single month. And then I'm ahead of the game.

So— And you also gotta just focus on where you are too. Where you are, at least in the summer, it doesn't move as well in the winter. Same thing where I am. I'm out, I'm out in the mountains of Utah where I live. If I was doing properties here, winter's gonna be slow. There's gonna be feet of snow on the ground. Yes. Florida, it's pretty much hot year round. In fact, winter's great sometimes in Florida. We've done deals there because If the north gets plastered, then we used to get calls all the time, be like, it's my last winter up here, I'm looking for land in Florida. So it's also area contingent as to how that goes and how much time you have. Because it's like, if you're— it's the end of September now. If you're putting out a property where we are in one of our regions, and you don't want to sit on it through the winter, you might be a little bit more aggressive because you only got a couple more months before snow flies. So a lot of it's just knowing all of those little details about where you're selecting and what the reality is. And does it matter? Conversely, if you had something right outside of a ski town, winter might be a good thing for you because people are out there, just happen to be looking. So you're just going to know what's going on in that market.

Yeah, absolutely. You've got to think about that. And if you are buying or doing something in tourist markets, then you need to know when the tourists are there, when are the people there that are going to see it and be interested. All right, so what is working for you today for finding motivated sellers?

So we've come full circle when it came to land, and I know this might be hard to believe for some people, but it's true. When we were doing land about 10 years ago, we were doing direct mail, and response rates were— if you were under 10%, it was bad. That was the response rate on direct mail, which never existed in We did direct mail in houses and everything else, and it was like if you were hitting 1%, you were doing well. That was just the way it was. Land, because they just weren't getting much.

Yeah.

Then that kind of went away because COVID happened and everybody was from home and everybody decided to become a real estate investor, whether they had any skills or not. And everybody went nuts and everybody did all these things. And so everything got saturated. We were sending letters and we were hearing, I got 7 similar letters and blah, blah, blah, all these different things. And So we shifted and we started doing like SMS marketing. We did some cold calling back to that. That worked well. In the current market, things are declining again. There's economic questions, geopolitical, all these different things that are weighing on people's mind. And it's not as easy as it was, not even close. And so because of that, a lot of people that jumped in when it was so easy, because it literally wasn't COVID, it was like Get a piece of property under contract for $80,000 and sell it tomorrow for $100,000. It was that simple. It was— that doesn't happen now. And so a lot of people that wanted that get-rich-quick mentality and just thought it was like the easiest thing on earth, some of them even started teaching it, have just disappeared. And so because of that, we've actually come back around to direct mail as our main source again, and it's pulling well again, at least for land. I think part of that is who the audience is. Most direct landowners that don't want it are, they've had it for a while, so it's still an older crowd. So direct mail works with them. It's, or people that even if they are younger, it's like inherited type of thing or whatever it may be. And so direct mail still pulls well. So we're back in about, we just did a mailing and we were at about a 3%. Offer rate. I shouldn't— it was a little higher than that for response rate, but we made offers on about 3% of the properties that we had mailed to. So definitely not where it was at 10%, but it's not below 1% like it was either. And it's definitely working. Direct mail is definitely working well.

Do you use a direct mail provider for that?

So I don't know. Do you mean for the actual mailing?

I've met some companies out there that do. That kind of direct mail stuff, it's like you give them your list and, or tell them what list, what area you want to target and they'll go and—

Yeah. So we give them the list. We get the list ourselves. So we use a few different tools. The nice with vacant lien, depending on where you are, sometimes the list is so simple to get. Like you can literally just go to the county and ask for a notice of lien. So it's pretty easy. Other ones, not non-disclosed states sometimes are harder. The ones out there that don't want to put the information out. In those cases, you can go to a list provider. We do have one that we work with and that we recommend, and they're good because they, they not only give you the list, but they also help you with area selection. Because when it comes to vacant land, I've noticed this more than other things, is people will tend to go off of what the county says it's worth more than any other number because they just don't know. People don't know how to comp vacant land. With a house, it's like, you know what your neighbor's house sold for, right? Or the one down the road. With vacant land, unless the property right next door to you sold, And even then, you have to be looking for it. So, because they don't live on that property. So in that case, because of that, if you can find areas where the assessed value tends to be below what market value actually is, then you're already hedging, putting yourself at an advantage. Because if they— if the seller thinks it's worth $50,000 because that's what the county's saying it's worth, but the county's 50% off and they're really worth $75,000, You're in a position now where you can basically almost give them what the county's saying it's worth and still make it work for yourself. And so if you can do that, and we have software and tools that do that, so we'll get the list from them and then we'll give it to a mail service and they'll handle mailing it all for us. So that's, yeah, that's not done.

Repeat mail. Do you just send stuff out one time to sellers or do you find that if they see the same thing over and over and over, certain time period that they're more likely to respond?

Yeah, that varies a lot, honestly, based on what's going on economically. So again, during those heavier years, going 3, 4 pieces was definitely helping. Now we've noticed that basic, because people don't remember anything. We've noticed that a very simple strategy is basically just mailing to the same group again a few months later with the same exact letter. They don't even remember it's you. And so, because the letter that we use works very well. And so there you can tweak them and do seconds, but the bottom line is you're not changing it much. The only exception is, and I'm sure everybody here has seen it, people that aren't, some areas the check letter still works decently if you do it right. The check letter that makes it look like they're getting an actual check and use like the windowed envelope. And because that, they think it's a check, right? Because they open it up because it looks like it. And then when they see it, it's like they realize it's not, but it gets their attention. That worked decent, especially a few years ago. Now we're not seeing a huge difference or any difference between using that or just regular direct mail. So it's like, at that point, why not just hit them with the normal piece? Because you're talking about a normal number 10 envelope compared to a windowed envelope. You're not talking about check paper. You're talking about real paper. Your marketing cost is substantially less to get the exact same results.

Yeah. Oh, wow. This is super insightful. And I know you've alluded a few times to, we teach people and stuff like that. So people, the The audience, please stick with us because I promise you that we will give you information on how to contact Jonathan later on and how to ask him about their teaching program and how you can learn from his team. Daniel, this is something that is probably near and dear to a lot of people. I'm actually working on a book with a co-author, Vinky Loomba, some of your, the audience may know her, called Go Beyond Multifamily. And we're putting together a book on all the different types of asset classes that we see our clients investing in. And then she and I did an event called Go Beyond multifamily a while back where we interviewed a bunch of people that were doing different things. And that's why we, we're at a, a weird time in the market where a lot of people just feel stuck, right? Oh, I can't find anything in my asset class. It's like, this is a perfect time to go learn something else, something new. If I do have kind of a crass saying, it's if your asset class isn't working for you, it's time to get off your asset class, right? I like that. Go find something else. Go find something else and learn a new skill and then go out and start applying that. And you might find that you like that better than the thing you were waiting around for. And you may find an untapped opportunity. So are you only doing this with residential property or do you do it with commercial property as well?

Yeah, we've done all different types. So we've done residential, we've done recreational, which was just basically, that doesn't, if you're on the East Coast and listening, you're probably like, what's recreational land? But on the West Coast, it's everywhere. Or the western side of the country, I shouldn't say West Coast. Just raw land that doesn't even have roads in some cases to it. And people are just going four-wheeling on it or hunting or whatever. That's a thing. We've done it with commercial land. We've sold industrial land. We've done infill lots, which is basically little lots that are left in cities that just for some reason just haven't got picked up where everything else around them is built out. But we flip those immediately. Usually a builder or somebody will want that. So we really don't have any. As long as the numbers work, I don't care what the land looks like. We, the smallest property we ever did was like 3,000 square feet in a city. And we've done stuff over 100 acres. So we, to us, it doesn't matter as long, as long as the numbers make sense, as long as there's buyers, as long as there's sellers, as long as there's some demand, everything fits. We worked in multiple states. East Coast. I'm from the East Coast originally. I live out west now, so I've seen it all. So we really don't care. And the nice thing that land does afford you is you don't necessarily need to stop when you get a lead as far as just flipping it or even owner financing it. We've had properties that we look at and it's X size and it's, wow, this could turn into— we had one that we bought where the guy, the price was great just for what he wanted, but we looked at it and we're like, This is 100% subdividable. Got involved with an engineering firm and civil engineers, and that area needed septic, so we had to get a soil scientist and some work behind it. But it turned into 14 lots and turned into multi-six-figure deals selling those lots off for not a whole lot of work. We'll entitle properties if it makes sense. Basically stories for all of these different things. And it's as small or as large as anybody Wants to make it. That's the nice thing with it. And the thing that we tell people is just go into any property open-minded.

Yeah.

Because if it comes up and you're, you're sitting there saying, I want to flip only, and then you find out that you can make, you're going to make multiple 6 figures by doing X, I don't have that money. Somebody does. And just like anything else, somebody will join you in the process if it makes sense. Just like multifamily, you need a sponsor to start. You're not going to, people aren't going to be jumping in on their own. There's always people that are looking for deals. The money's out there. You just find them when it, for when the numbers make sense and they'll jump into it. We've had people that we did, they were shocked at the returns that they got. And literally the check comes in the mail and the next question is, you have another one? So, wow. That's what you want. That's exactly what you want. Right? So, and that, and the $4,000 is what the basis is, right? The foundation for everything else. Every house. Every multifamily, every commercial center, every— they're all built on— they all came from a piece of vacant land to start with.

That's true. It all started as vacant land. All right. What kind of due diligence do you do before you buy a piece of vacant land? And then what are some of the kind of issues that you look at and you're like, okay, this is absolutely a no deal?

Yeah. So due diligence is a huge thing and it's funny how many people skip it. Because I remember when we first started in this, it was all about get the property under contract and put it out there for sale. And all the answers were basically like, talk to the county or talk to the city. They weren't doing anything. It was putting it on the buyer.

Mm-hmm.

And if you're double closing it and you're just going to flip it, and you're basically mitigating some risk doing that because of the way you're handling it, but you're also not building a whole lot of Confidence in your buyer by telling them to go find all the answers. So we basically do all the due diligence upfront, then we use it in our marketing because we're getting the answers. So we obviously want to know what the situation is. We find out what the utilities are there, whether it is well, is it septic? If it's septic, what's the soils like? Are lots of the lots around it are the exact same soil size and they all have septic tanks? You're not really too worried about a FERC test if nothing's around it.

Yeah.

There might be a reason. So we're looking at all that upfront. We have an entire due diligence checklist, and in fact, we give it away for free. It's on our website. So we'll talk about that at the end. There's a free book out there about— it's all literally— I thought I had a copy next to me, but I don't. But it's literally our due diligence handbook as to what we look at. And there are certain things that we never skip, like what I just mentioned, but we also always take every one of them further because due diligence also includes what can be done. So it's not just on the is this permitted and is this the condition? It's also okay, this lot's this size. Can it be split in half? Can it be split in multiples? Can I change the zoning? Can I whatever it may be that is adding value? So do you need to do those things? Of course not. Those ones you don't. It's just giving you better options for sale and selling at a better price. But there are ones that you certainly want to know. What the case is. As far as red flags or whatever you said that makes us just walk away.

Yeah.

There's a couple. Obviously, if it's smaller and the setbacks, it just doesn't allow anything. It's like nobody's going to— you might be able to flip it to a neighbor that wants to make their lot a little bit bigger. But other than that, you really don't have much exit. Wetlands, if it takes up the whole property, it's the mitigation costs are generally not— unless it's a commercial lot or if it's just a residential lot. The commercial, the mitigation costs, if they even allow it, are usually not worth the effort. In that case, flood zones is a funny one. People always talk about walking away from flood zones. I don't walk away from them at all. I don't care. Because people are like, oh, you don't want a property in a flood zone? And I'm like, you just basically eliminated half the state of Florida if you, if that's the way you feel, because everything coastal is in a flood zone. It's unless you're like in New England up on the cliff or something, but it's the most— Areas. It's like all of Florida coastal properties in a flood zone. I don't care about flood zones. I do care about floodplains because that's a totally different situation and you may not be able to build in that and things like that. So we look at floodplains. I mentioned the wetlands. So water is a big thing. And then also just access issues. Yeah, how landlocked properties, people will buy them for land banking, but they're going to be at a discount. You've got to see, and what is the access issue? Is it 100 feet off a road and getting an easement or getting some permission might not make a difference? Or are you talking, we had properties that were like miles from anything and it's the Wild West where it was. So people didn't necessarily care. People would still buy those because they were just riding four-wheelers and stuff all over everybody's property and nobody really cared, cares where that is. But it's also, you're not going to ever build because you're never going to get a building permit without a road. There's no electricity anywhere nearby, anything like that. So you just gotta know what it is for that particular piece of property.

Okay. Yeah, that all makes really good sense. So it sounds like you have a whole toolbox of different ways that you can sell. And, and I think it makes really great sense that you're saying that you go do some of that due diligence that a buyer's gonna wanna know, cuz they're gonna come in and start asking those questions. And if you've already done that, then that's going to make their buying decision a lot faster. You're not going to, they're not going to have to wait.

And yeah, we actually put it in our marketing.

Yeah.

So it's side by side, but it's funny because you'll have a lot next door near nearby and it's 1 acre lot, buildable, come and check it out yourself. This big little paragraph where, whereas utilities, this water, this. Septic sewer, this zoning, this, and it's, and you're spelling it all out for them. And at the end, we do give a little disclaimer. We're just basically saying, yeah, you have to verify this yourself. We got this information from the county.

Yeah.

You can do the same. Because we don't want to get sued by them, but it's literally like for saying something because the county can change and we don't know, or the person at the county may have given us wrong information. So we say, go talk to them yourself, but this information was provided by them. And That definitely helps because now if you've got 2 properties that are similar in price, similar in size, and one's basically saying nothing and one's giving you all the info and it's answering your questions, which one are you more likely to buy?

Yeah.

So we're helping ourselves.

Path of least resistance, right? Yeah. All right. So what about getting financing on a land transaction? Is that even possible?

It is, but it's not easy. Most lenders are going to want 50% down. Traditional lenders are going to want 50% down and then the interest rate's going to be higher and interest rates are already high. Just in housing, it's high. So you know you're going to be it's going to be even more. So that's where if if you're on the buy side, that's where I said going through creative financing and making deals depending on what makes sense hard money or if it's a joint venture or splitting the deal or bringing in a partner or whatever it may be that usually makes more sense or approaching the seller. Some sellers are all for seller financing, and obviously if you can get a term that's substantially better than what you're going to offer and you can wrap it or whatever like that, then that's a possibility as well. As far as selling goes, because of those same issues, offering seller financing is a huge advantage and a great way to sell and create cash flow. Now, the property has to make sense for that because obviously if you're buying a property for, let's say, $100,000 and you're selling it for $150,000, even with seller financing, you're not going to get anywhere near $100,000 down. So are you okay with Completely negative, being in the red on— you don't have to be negative cash flow because there's not going to be any, but yeah, you're going to be in the red as far as waiting for your money to come back. Are you okay with that?

Yeah.

Conversely, on lower-end properties, that goes away. It's, you're buying a property for a few thousand dollars and you're selling it and you're basically within a month or two, you've got your money back based on the down payment plus the— so that risk goes away majorly in that case. So That's why I said earlier, we love seller financing some of these lower-end ones, and we'll even target them on purpose for that, just to build up passive income very quickly. From that, you can get like a 5-figure-a-month passive income. I know people doing 6 figures a month because this is all they build up with these lower-end ones. But again, you could do that fairly quickly to get those and get that back in stock, get that going. So that's where we tend to Ourselves in our business, and everybody can treat it differently, but we focus a lot on owner financing lower-end deals and selling for cash the higher-end ones, unless we just happen to get a home run, which every now and then happens. Somebody tells you they want to sell their $100,000 piece of property for 10 grand. It happens. It's not often, but it happens. And when that happens, obviously now you've got whatever you want to choose in front of you. You could discount it to get $50,000 quick, or you could owner finance it, get the $10,000 back and make $1,000 a month for a number of years. Whatever the, you as the investor want to do. That's the nice thing. You just take it case by case and based on what your situation is at the time.

Yeah. From thinking of it from our perspective where we help people legally raise capital, if you need to bring an investor in, certainly this is something you can joint venture on. If it's a smaller amount of money, you're both going to be active. You or 2 or 3 people are going to be actively involved in making the deal happen. Participating in the decisions. You could syndicate, you could do an entire fund that its whole business is going out and finding these opportunities. You have investors in the deal, you share some of the profits with them. Maybe some people want a fixed return, some people want just a split on profits. There's all different manner of ways that you could syndicate these kinds of deals or use securities laws to help you raise the money you need to be able to get into these deals, or just do them, like I said, as joint ventures or private loans, promissory notes. You could offer people a secured position on the property. So there's a lot of different ways that if you don't have the cash yourself, you could bring in other people in order to help subsidize that while you get going until you build up your own cash reserves and you don't need them anymore.

Yeah, we do a lot of the joint venture side just because it's basically like, I'm the money, they're the money, I'm the expertise. And so we'll do that. And it goes back, it's in your book, it reminds you there. You talked about like friends and family to start with. And that's honestly where, because a lot of them are sitting on something that they just don't know. And the nice thing is maybe unlike other real estate investing where it's a little bit longer to get the money back, it's still good money. Don't get me wrong. And there's definitely advantages in other real estate that land doesn't have, depreciation and things like that. So for tax advantages and all that, but when you're trying to talk a family member into putting money up to get a return in 3 years or 5 years or something. As opposed to get your return in a few months, they're going to be more likely. And it's not a bad place to start with those, those people and just build something in with that. We did that with land with, and I, like I said, we always talked to Kim before we started. I've got people that I've done these deals with land and now they're asking me, because we're looking at other things, we're looking at some multifamily deals and stuff, and they're ready to go with those because they liked the way they were treated. And so that could be an advantage too, honestly, with a land deal is just that because it's so much faster. They get a return, they're happy. It was like I said, the person got their check back and they're like, how do we do another one? Because it was like, it was, and now you're building that relationship where when now when you ask them for a bigger chunk of change and it's a slower return, they trust you. And now you're building that relationship where you just keep doing it. So I personally, the book's great. The principles still apply 100%. Start there and go through all the other things that she mentions. Regardless of what your real estate structure, if you need money, it's all about money. So it's just—

I'll just do a little plug here. If you are watching and you wanna know about our books, we have 2 of them. One is called How to Legally Raise Private Money. This is a beginner's guide for people who are just starting out, never have—

they—

this is probably the one you need if you're gonna use Jonathan's method. It's short, 168 pages. You can read it in a short period of time. It's just step-by-step how-to. This is really just an expansion of the first book. It's more encyclopedic. I've written it so that you could have, just go to the table of contents and read the sections that you need to read. But there's sections in there on joint ventures and stuff like that. This one talks more about the promissory notes if you're gonna go that route. But Jonathan, let's tell people how they can learn about your programs that you offer.

Sure. So a little bit on that really quick, because I know when everybody hears about like education, sometimes they're like, oh, the next guru pitching their thing. I don't ever consider myself that. I've never done that. I actually— it was funny. So that student I talked about that, that did the— he started with— didn't know what a deed was. So there was another speaker, a national land speaker, that was speaking in my area. So I went to the event and he actually pointed out, hey, there's a guy in the back row that's done— if you have questions, go talk to him. And so like about if this really works. And so I got flooded. Nobody wanted to talk to him. They wanted to talk to me because they were like, I wanna talk to the guy actually doing it. So afterwards, this guy calls me up cuz I, I gave him my number. I didn't think anything of it at the time. And he says, hey, can you teach me how to do this? And I was like, they offer training. And he's like, yeah, but you are the one doing it. I wanna work with you. I don't care about some guy talking from a stage. And so that kind of started the whole education side for us. And so that individual, like I said, went crazy and he made a bunch. And I was like, hey, there's something here. The person that was teaching from stage found out. And so he reached out to me and said, can you come teach for me? So I was like, sure, why not? So I did. I did that for a little while. Didn't really like it. Went off. Just said, okay, I'm done with this. I'm going back to just doing the deals because that's what I liked. Well, apparently I had a following and I didn't even know. And a bunch of people reached out at, where'd you go? I want to learn from you. I was like, so. We were like, okay, we'll start a thing for ourselves. And then it just kind of turned into something. So we intentionally keep our training small. We want this family atmosphere. We're not about being the big guy on stage with 1,000 people in there. And we all know who they are. They're all over the place, right? So anyway, we have the LAN Method is ours. We have different trainings available. You can go to thelanmethod.com. We do have a home study course. We call it Coaching in a Box. The reason we call it Coaching in a Box is because we basically try to cover— it's not a bunch of fluff lessons. They're detailed and they're intentionally detailed for if you're in this market, this, if you're in this market, look at this, because we've lived through them all. So what we see now and what we're telling you to look at right now is different than it was 4 years ago, 5 years ago, completely. And a lot of people are still teaching what they, what was going on 5 years ago. If you're doing that, you're not making any money. You're just wasting money in marketing. You're wasting money in And so we do have that. So it's not actual coaching. It's not us calling you and talking about it, but we call it that because we tried to leave no stone unturned where if you're a go-getter and you understand how, understand real estate and again, your audience, I think mostly cuz they're following, if these things make sense to you and you can put the pieces together, we're filling in all these gaps for you. You just go and implement it.

Nice.

If, you know, if you do need help, we offer it.

Okay. Yeah. Let's hear about that.

Yeah, we do have other, we do have programs and things like that. So like I said, if you go to landmethod.com, one thing, like I mentioned, was the due diligence playbook inside there. You can just fill in your information. It'll get emailed to you. So we talked about the due diligence there. That's sitting right there on our home screen. And that's a great way to get going with that.

All right. So go to thelandmethod.com if you want to know more about Jonathan's program. It sounds amazing. And I don't know if you want to share what the cost of it is, but he shared it with me at one point and it's pretty palatable. I think you would be happy if you were to pursue that a little bit and you want to learn a new skill. I think it's going to be—

Yeah. And we're also— I mean, so I talked to my business partner. We also decided because of the relationship with Kim and just with the fact that this is a more in-tune audience, let's do it when it comes to real estate. Basically just to give you guys a discount on it as well. We'll give you a coupon code. It's actually just LAND50. So LAND, capital L, LAND, and then the number 50. And just half off. We've never done half off, honestly. We've done 20% off. We've never done half off. We just said, you know what, for this group, they're not going to be driving us nuts asking questions like, what's a deed and what's owner financing and what's the— it's like, they're going to just go and do it. So for that case, and basically you get all the lessons and we also give you all of our documents. So what we use, our letters that we send out, the contracts that we use to buy, our owner financing contracts.

Wow.

So if you go to Land Riches Blueprint is the actual course name. So if you go to landrichesblueprint.com, you'll see it. You can type in that information, use that code. It'll take half off for you. Or again, you can just go to the main site, landmethod.com. You can look around, learn more about us if that's what you want. We want you to feel comfortable. And then right from there, you'll see that as well.

The code LAND50, is that no spaces, just capital L-A-N-D?

Capital L-A-N-D, no, A-N-D small, and then 5-0.

Got it. Okay. Thank you so much for that. That's so generous. And yeah, I think I may become one of your clients. So thank you so much, Jonathan, for coming on. This was super valuable information. I know I really enjoyed it. I think our audience will really benefit from it, and I hope that they've enjoyed it as well. And if you want to know about us, go to syndicationattorneys.com. If you'd like a free copy of one of our books, just click the free book tab. And you'll be able to get one. If you already have a book, we'll only let you get one for free. So you can go to Amazon, just type in my full name, Kim Lisa Taylor, and you will get both books. If you want the beginner's guide, then you can just, you're gonna get asked a question. Have you raised capital before? If you say no, you'll get the beginner's guide. That's gonna be the one I think most relevant to this particular business. If you say yes, you've raised capital before, you'll get the more advanced version. And if you are buying businesses, we also do have a, on our website, How to legally raise capital for startups and small business. So thank you so much, everybody, for being here today. Jonathan, thank you so much. You've been an amazing guest and I can't wait to do some more business with you. And I'm excited about your program.

Thank you. Thanks for having us. Appreciate it.

Thank you so much.

Have a good one, everybody.