Here Are The Reasons Why We've Passed On A Property Before

Hey, it's Mark Podolski, the land geek with your favorite niche real estate website, thelandgeek.com and on this week's roundtable, we have almost all the usual suspects, except for the technician, Eric Peterson. Tate Litchfield, you've got a pretentious hard stop. We are going to skip the pleasantries. Hello, everyone. It's great to see everybody. Scott Bossman, Tate Litchfield. Teria Harris, Scott Todd, Mike Zano. Great that you're all on the roundtable. If you don't know who we are, go to the previous podcast to hear a proper introduction. But we've got a really interesting topic. What are the reasons you pass on a property instead of buying, even if title is clear? So title is clear. There's other issues with the chain of title. There's no liens or encumbrances. How often do you buy a property that has some kind of, you know, let's say it's got hair on the deal. The investment banking term. It's got hair on the deal. How oftentimes do you buy it but you can't sell it? Mike Zano, I know you love going first. Why should we stop the tradition? What are the reasons you would pass on a property? And have you ever bought a property that you couldn't sell? How often does that happen?

Okay, so it's a two part question, number one. Well, I guess I'm going to read into the question. I'm saying that like it's got clear title, but maybe there's something else going on. Maybe there's a huge wash to it. Not that that would prevent me, but I think there could be some issues.

Right.

Access. There's a thing that people sometimes get tripped up over in the beginning. Like it may have this planted access. Then there's like actual access, legal, all these different things about access. Right. So I think in the beginning, if someone were starting out this business, they'd probably want to see actual access. It might just make their day go a lot easier. We know that all the properties do sell. I think in the beginning I probably did pass on those. Now I have probably very few properties I will pass on if the price is right. That's what it really comes down to. Because even if it's inaccessible, while there's other inaccessible properties in this area, we know certain parts of the country have these and they're selling. How much are they selling for? How much are you buying it for? So I think it really comes down to the price and getting stuck with a property. No, I Mean, I've done the one where you're buying from someone, they're like, hey, I have this property up, and I don't even know. I've never even heard of the county before. And I'll offer them some ridiculous amount of money for it. If they say yes, I get it. I may just sit on it because I don't even advertise it. I had one in an area that I sat on for a long time, and then I was like, oh, I might as well. I advertise sold in a day. And I was like, whoa, this is a good ear. It'll get some more. But I never even put any thought into it because I just sort of put it in the back burner. So I guess that's. That's my initial thoughts. Tear me apart, guys. What's that like, sit down, Convince me I'm wrong.

I mean, if you're gonna. If you're gonna open it to the group to tear down your answer, I don't think we're gonna. We're gonna take the bait, because it wasn't. It was a good answer. Why don't we go to your partner in crime, the nightcap OG Scott Bossman Scott, number one, do you like Mike's answer? Number two, what are the reasons you would pass on a property? And have you ever been stuck with a property you couldn't sell?

I always love Mike Zano's answers. Never do I not love his answers. So for me, it's about, you know, when you're first starting out in this business or. When I first started out, I did pass on a bunch of properties. One, because I didn't have proof of concept. Two, because maybe I had deals in the pipeline and I had a budget or purchasing property that month or that type of thing. And that's kind of the way I think about things now as well. I have kind of a priority list. Like, I know what sells to my buyers list. I know it sells in the market, and. And I'm going to buy that property. Now. If there's another property that it has an easement, but there's no road access, that's going to be a little bit less on the priority list. If there's another property that's on the side of a mountain that might be a little bit less on the priority list because I want to buy land that caters to my market. So that's kind of how I view it right now. But there's really not much we won't buy, especially at such a discount. We're not going to lose money right when we're, when we're buying it. Such a deep discount on these properties and, you know, my offer to a certain owner might be 25 cents on the dollar. If we find there's an issue with it as far as road access or the terrain or there's a wash of the property or that type of thing, we will negotiate down even further to make sure that there's enough meat on the bone in the end.

Have you ever been stuck. Have you ever been stuck with a property you couldn't sell?

Never been stuck, no. You just got to market them, I think out of fear. One time I thought I was going to be stuck with the property. I had marketed it for three or four months and got no bites and had some horror stories from people trying to get out there. One guy got stuck. He got pretty upset with me because I told him there was road access. The road was not great and it ended up being a big slab of rock that you couldn't really do anything with. And I wrapped it up into another deal and just said, you know, buy one, get one free. But I fudged the numbers in a way where I didn't lose any money. I made money on the deal, but no, I've never, never been stuck with the deal.

All right. All right. Taria, putting in the reps. Harris, how about you?

So I kind of have a hybrid answer between the Nightcap duo. So we passed on properties in the beginning for sure without good road access. And because we had specific buyers, like 10 of them at the time, and they didn't want anything that did not have road access, they were specific about that. So in that time we were trying to buy to cater to what our existing buyers list wanted. So we did, we passed on them. Now, knowing now what we know, we could, we would be more confident buying them. And then we know they would eventually sell because they were in a good area. They just did not have road access. And one may have had an easement. So we passed on it another property we had to pass mostly out of and we passed it to someone else because we hadn't run out of finances. So we ended up kind of giving them the property or allowing them to buy it. They gave us, you know, a little money on the back end. So we still made a little bit of money off the property even though we couldn't afford to buy it outright. So twofold in terms of buying a property that we can't sell, we've never had a property that we could not sell. Some have taken longer to actually sell. Some we've had to discount in order for them to sell. But we've never had a property that we could not sell, nor a property that we've actually lost money on.

So now that you've been doing it a while, what's your tolerance for land that you might say doesn't have great access? Or from the very beginning, when you're first starting out to now?

Now we're comfortable doing it. In the beginning, we weren't even comfortable writing that in an ad like, you know, no real road access or when people would call. We just weren't comfortable having that conversation. Now we are comfortable, and we realize that that's not a deterrent for many buyers, that's not a big deal for them. Those who want land in that particular area, they're willing to take it. So we're much more comfortable now.

Yeah, I mean, it's pretty interesting.

Why do you think that is, that people don't care? Yeah, I think for some of our buyers, we have different buyers, One who definitely want to build on the property, live on the property, want to be able to get to it easily. Then we have some who we just want to go camp. You know, we want to go out there and hang out on the property and being able to drive directly up to it or have road access to it, it's just not that important for what they want to use the land for. So I think once we start determining what people want to use the land for, there's always land that fit what they want to do.

Okay. Okay. I love it. I love it when you call me Big Papa Tate Litchfield, have you ever looked at some property like, oh, yeah, I'm not buying that. And if you did buy a property that may have been problematic, were you able. Were you ever stuck with a property you couldn't sell?

I mean, to be honest, at the start, I passed on properties I wish I wouldn't have. Knowing what I know now about the land business I passed on for the same reasons everybody else mentioned. Nowadays, if the title's clean and there's money to be made, I buy it. I mean, honestly, I bought some properties the other day, and the me from four years ago probably wouldn't have, but I know what I know about the properties in today's market, and it's like, yeah, I don't need to swing for the fences on every single property that I bring to the market. If I can make 150% on the deal, why wouldn't I right. I had a property that we just sold. I bought it in 2015. I actually bought it with Scott and it was in. It's not a bad property. It's just in an area where we've never done any deals and paid thousand bucks for it. And it kind of just came to the top of my radar last week. I was like, I got to stop this. I got to get this off the books. I hate seeing it. It's time to go. And we sold it like 48 hours later, made, you know, two grand or something on the deal. So even the properties that I deem to be problematic aren't problematic for somebody else. Right. And I'll buy anything at this point. About 15 properties the other day. I've got three left. I'm buying another 10 today, kind of thing. Same person. Because they are moving and they're good lots.

So.

Good time to be a land investor. Buy what you can get. If there's money to be made, do the deals. Don't think twice about it.

Yeah. I mean, it's a good lesson. That's a lot of donuts on a two grand profit.

It's a lot. Yeah. I mean, it doesn't hurt. And, you know, you think about it, yeah, it took us, what, four years, five years to sell it, but it didn't hurt to carry it. Like, my carrying costs were $4 a year in taxes. Who cares that it took that long?

Right?

Doesn't matter. This isn't a game, right? Right. If it's a game to you and you're really stressed out about it, yeah, it's going to eat you alive. But it's not. This isn't a hobby. So I can buy it. And I'm in this for the long run. I'm going to be selling land for 20 years from now. So if it takes me that long, I bought it at today's pricing. The market's going to continue to grow and people are going to continue to want this stuff. So it doesn't matter to me.

All right? All right. Scott Todd from Scott todd.net landmodo.com Learn anything about anything. Investortinjas.com do you have a different answer than the rest of the group, Mark?

I would say that it's very similar, but there's a. There's a website out there. I don't go to it often, but this whole conversation made me think about it and their tagline. This website's tagline says on a long enough timeline, the survival rate for everyone drops to zero. Okay, now why am I bringing this up? Well, you know, when we think about getting stuck with a property, I would say that with your timeline long enough, you'll never get stuck with a property. So if you're thinking, okay, well, I'm going to have to sell this thing in a week or I'm going to be stuck with the property, well, then you might be stuck with a property by your definition. So I think that you really have to think about how you're defining being stuck with a property. But I've never, I mean, Tate just said, like, four years. I've never been stuck with a property. But at the same time, I'm also not panicking about it. It is what it is. I pick these things up. I pick them up because I think that they're on sale, and then I'll sell them in the future at some higher value. I don't have to. I don't have to sell it today. Now, if I were going to wrap up a lot of capital in something, I'd be very cautious, right? You know, but the deals that I'm doing, 100, $200,000, something like that, 1700, $2,000, it's not going to. Not going to kill it. Now, the other part of the question, I took them out of order, but the other part of the question is, is are there deals that I would not do? And I would say that maybe from the get go, I just always, you know, I don't know, I just, I just did it, right? I mean, I didn't, I didn't second guess it. I would just buy them. And like I said, I would buy them because I thought every one of them was on sale. And however, Mike Zano. Mike Zano hit on a very important point. You see, like, I will buy something even if it has flaws, but I will do it at a price that I feel comfortable with. And I think that's the difference between speculating and investing is when you can come up with what you think the right price is based on the information. So I always like to tell people that I had a guy once, he was. He wanted me to buy land in Florida. It was basically one of these platted roads. And what that means is that there's. There's. On the map, it looks like there's a road, but there's no road. You can't get to it. There's trees where the road would be okay. And I don't buy those typically. I'm like, no, I don't like those. But he said he's like, listen, we just want to sell the land. How much can you. Will you buy it for? And it wasn't even a county that I was working in. And I was very honest with him. I said, listen, for me to buy this land, I'm gonna have to wholesale it. I did think about the car dealer, right? The car dealer would say, well, you know, we're gonna take your trade in here. We're gonna send to the auction house. We're not gonna make any money on it. So I had to tell the guy, look, this isn't even a county I work in. Probably I'm gonna have to take that thing and, you know, sell it. Sell it to another wholesaler. Sell it wholesale. So I just have to be in it for very cheap. So my offer to you for this third of an acre in Florida is $100. And he said, okay, sounds good. Let's do it. So, you know, at that point, when you're negotiating your price, I think that the reason I would not buy something is because I think it's overpriced. That's the thing is I will look at it and go, I don't like it for that price, but I like it for this price. And that's even language that I use to sellers is, I will tell them, look, I don't like it for this price, but I like it a little bit more for this price. Because X, Y and Z, because there's no road access, or because of this. And that word, because we've talked about it before, is so important. You could walk up to a long line at a bathroom where everybody's waiting in line and go, listen, I need to cut here because I'm going to have an emergency. Go ahead. Right? Like, the word becomes so powerful. But you put that into your language to sellers, and they're like, I mean, okay, it makes sense to me. And then they just move on.

Yeah, this is podcasting gold right there. And, you know, not to beat a dead horse, but I've talked about, you know, my $50,000 lesson ad nauseam, boot camp after boot camp. So I'm not going to retell that story here, but I learned very quickly not to be a land snob and that I'm not the market. So just to give you some perspective on value, right? Have you guys heard of a thing called an nft? A non Fungible token. Tate, you heard about this thing?

Oh, yeah, yeah, I pay attention.

Well, of course.

They're all over now.

You're young. Terea.

No.

Okay, so a non Fungible token is basically a digital asset that's one of one, and then it goes on the blockchain and it becomes sort of a cryptocurrency or this crypto assets. It's sort of this new asset. So to give an example, anything digital could become an nft. So here's the latest example of value. Tria, how much would you pay for Jack Dorsey's first tweet on Twitter? Now, you and I could both screenshot it, but if he digitally signed his first tweet, that was it. It was one of one. Jack Dorsey's first tweet on Twitter. How much would you pay for that? And you can put it up in your house and just show like a little digital signature. Jack DORSEY first tweet.

$1,000.

You say $1,000. Tate, how much would you pay?

Yeah, I mean, I don't use Twitter, so nothing. It's not valuable.

Okay, so, so you're at zero. Scott Bossman, how much did you pay?

Not much.

Not much. 50 bucks for the first tweet?

Well, of course, 50.

Okay, Mike Zano, how much would you pay?

$0. In this.

It has no value to you. So you're at zero. Scott's pretty much at zero. Tate's at zero. Tria, you're at $1,000. Scott Todd, what would you pay?

I would just outpit 1001.

A thousand one. Okay. The market looked at that asset and said it's worth 2.9 million in a competitive auction. So someone paid $2.9 million for the first one of one digital tweet by Jack Dorsey, and it was run by a platform called Scent, a blockchain powered social media network. So somebody out there thinks it's worth more than $2.9 million, because like Scott Todd said, they're speculating on that value going up. We don't speculate. We're investing. And there's a very, very big difference. And I think if you take anything away from the podcast is that there's already a track record of this asset being sold at a price. We're buying it at 25 cents of that baseline, and then we're going to resell it to someone else. So. So there's already an established track record of this asset being valuable to at least somebody. Right. It's not like it's a whole new asset class where people are like, oh, wait, I wonder why land is valuable. Wouldn't it be great if land lasted forever? Oh, wait, it does, right? Wouldn't it be great if there's A fixed supply of it. Oh, wait, there is. Wouldn't it be great if you could improve it? You can. So, you know, if you're listening to this and you're nervous about, you know, who's going to buy this land, or it's got to be perfect and you're going to pass on it, email me markthelandgeek.com Lock up the deal. I'll buy it. Because my tolerance now is so low, it's actually laughable. I mean, and if you've been to boot camp, I love Scott Todd's story about his mud pit. He sold a mud pit for way more than he paid for it. Now, you know, if we're talking casual conversation with a group of strangers, and Scott's, you know, drinking a beer and telling people, yeah, I just bought a mud pit and I flipped it. I made 15 grand or whatever it is, they would probably hear it the same way we're hearing about this Jack Dorsey Tweet. Someone paid $2.9 million. But we are not that market. Right. We're probably not the market for a mud pit because we don't have the big quad to go out there and have fun on it. But I'll tell you what, if we did, we'd probably pay more for it than that person did, because that's something that. It solved that problem for them. So, Scott Todd, any last, final words on that?

Yes. One final thought on this, Mark. Listen, if you're going to email Mark the offer to buy the land, be prepared to be beaten up over the price. And if you want an easy layup transaction, then call me.

Call me. You just call me. Tate Litchfield.

Scott Todd.

Tate Litchfield.

Yeah. That's the reality, okay? Like, that's the real deal there. So, you know, Mark's great, but he's gonna beat you up, and it's gonna be a lot easier dealing with me than Tate or Mark.

Okay? So I think this could be another podcast episode is who would be the easiest of the group to negotiate with. My money is either gonna be on Bossman or Eric Peterson. Taria, we all know, is a shark. She would be difficult to deal with. Mike Zana, with that charming Boston accent. I don't know. Like, next thing you know, you're like, wait a second, I wanted 1500 for it. I just gave it to this guy for 250 bucks. What happened? Like, it's like a Jedi mind trick, you know? So Tate, I think, would be a layup compared to Scott Todd. Oh, my gosh. I mean, Scott's the kind of guy that goes to Nordstrom and starts negotiating. How much? These socks say they're 15 bucks. I give you five.

You think Tate will be easier than Scott Dodge?

Way easier. Way easier. In fact, you could split test it. If you got a piece of land that you're not comfortable buying, email both those guys and see which one is easier to deal with. Then we'll know. And we could put in the Facebook poll. Anyways, I thought this was a great podcast. But now, of course, we're at that point where we're going to ask Taria for her tip of the week. A website, a resource, a book, something else actionable for the art of passive income listeners to go improve their businesses, improve their lives. However, we have to mention our sponsor, which is flight school. Flight school. Learn how the next 16 weeks can literally transform your life. Wouldn't it be great to have that mailbox money coming in, making money in your sleep, but you don't have to deal with any renters, rehabs, renovations, or rodents. Wouldn't it even be better if the person who's teaching you how to do it did it thousands of times? And not only that, you're mailing by week two. Oh, that. That's right. We have a program called flight school. Oh, what's the tuition? It's irrelevant because we guarantee you're going to make it back 180 days or less. Cash or terms deals. Learn more. Go to landgeek.com schedule a call with the Nightcap OG Scott Bossman or the Zen master Mike Zano. I promise you, there's very few things in life that are literally transformative. Because once your passive income exceeds your fixed expenses, not only have you solved your money problems, but you solved what's even more valuable, your time problems. So make the call. Don't hesitate. Time's a ticking. All right, Terea Harris, what is your tip of the week?

Well, a little background. So Landon and I are. We're Siri people, right? So anytime something we have to get done, we're like, hey, Siri, remind me to do this. Hey, Siri, remind me to do that. So obviously it's 2021. There has to be some sort of apps or something out there that can help, you know, manage all our tasks and our responsibilities and support some goals that we may want to set. So there are dozens and dozens, hundreds and hundreds of them. But I found one that I really like. It's called Strides app because it allows me to set both habits and goals and any tasks or things I need to get done. And so instead of just saying or instead of it just being like a calendar based goal, like I can set an average where I want to sleep. Sleep a certain. An average amount of sleep. Or I want to save money, I can set targets or maybe I want to develop a new habit. I can put that in there. It even allowed me to do like project based ones. So, you know, we want to come up with a milestone for going into a new county. We can set projects of how soon or how long we want this process to take. So it Strides app, I know it's definitely on Apple. It may be on Android as well, but it is. The free version gives you three goals and three habits that you can track. But obviously the paid one, which is $5 a month or 20, $30 a year or there's a lifetime one for 80 bucks where you have a lifetime access, you get unlimited habits and tracker or habits and goals you can track.

I love this. But how does this work with your reminders?

So you can set up reminders in there.

What's it called again?

I don't see strides. Yeah, it's stridesapp.com track anything you want, any way you want. Totally flexible. Four unique tracker types. You can track anything that matters to you. And it's easy to customize to fit your needs. I'd like to track how many times Scott Todd eats a donut in a day.

He eats one a day, right?

That's what he says.

I'd like to track it one per day, man.

And then I'd like to track his.

Mathematical formula for that.

I'd like to track the spike in blood sugar and then when he has to take that carb nap. I'd love to watch that. That'd be a great reality show. Scott's Donut.

I don't pick a nap, man.

I don't.

It's. Your whole perception is wrong. I mean, that it's all wrong. I mean, and you could say, well, I tried this little thing, but until you get the formula dialed in, baby, which is okay, it's got to be the Krispy Kreme donut.

Okay?

Like, it's got to be that one. There's other variations. You could go with it. But if you go big, it's about the calories, man. It's all about the calories. You hit the calorie number, you're golden. But then you go, you know, you go eat a 500 calorie donut or three donuts. Well, yeah, okay, maybe you're gonna. Maybe you're gonna crash a little bit or then you're gonna have to go eat some more food. All about consistency, man. Even Dr. Oz will tell you that if you eat the same thing every day, your body will work a lot better. Eat the same thing every day, man.

Teria, is that true?

I eat the same thing every day.

She doesn't eat.

I give a little flexibility on the weekend. Like, we'll go to brunch on Sunday, but for the most part, our meals are already planned out and prepped for the whole.

Oh, you know what? That should be the next podcast. What do Tree and Landon eat Monday through Friday? Don't Monday through Friday.

What do you mean?

Yeah, it's called the bone broth episode.

Every day, at least 8 ounces of bone broth. It's good for you.

Oh, my gosh. Scott Boston, you ever tasted bone broth?

Yeah, I think I've used bone broth when I cooked something.

But no, no, no, no. To drink it, not to cook.

Oh, I don't drink bone broth.

Come on. So don't. We don't get it out the carton. We go to a specialty store where they make it fresh. Or you can make it yourself, but you know someone else. I'm keeping someone else employed. We go buy it from them.

I like that. Mag Zeta would rather eat Kibby or bone broth.

Well, I would prefer Kibbe, but I've had bone broth with soup because you get these soups and you put the bone broth in there and it's pretty dang good.

It's like a soup chicken bone broth.

I don't know. I want to thank the listeners, though, for putting up these shenanigans and remind them if you're getting value from the podcast. Follow us. Rate. Review the podcast, Send us a screenshot of that review. SupportTheLangic.com we're going to send you for free the $97 wholetailing course, how to double your money, 30 days or less. Are we good?

We're good.

All right, let's do this. 1, 2, 3.

Let's let freedom ring.

Not bad, not bad. Thanks, everybody.

See ya.

Thanks for listening to the Art of Passive Income podcast. Start your journey at www.thelandgate.com and www.scotttodd.net. rate and review the podcast and email supportgeek.com your screenshot for a free passive income launch kit.