How to Avoid a Land Investing Experience that Costs Fifty Thousand Dollars

Hey, it's Mark Podolski, the land geek. Here's your favorite niche real estate website, thelandgeek.com in today's Art of Passive Income roundtable podcast. It's really special. It's just me and Big Papa. I love it when you call me Big Papa. Tate Litchfield. Tate, what's up?

I'm good, man. I'm excited. It's boot camp week, so we're busy. But we're in the dog days of summer.

It's hot, it's hot. We're busy. We got boot camp. And by the time you hear this, boot camp will have been done, and it'll be amazing. So Tate and I were just thinking, like, why don't we take a trip down memory lane and discuss one of our earliest deals? Because now it's really rare. It's got to be a really big deal for us to go out and fly out and look at a piece of property. Boots on the ground. And so, Tate, I just be curious, like, your first. First deal, boots on the ground. What was that experience like?

So I went. My first boots on the ground experience. I'd done land deals before this, but it was out in Arizona. I live in Nevada, so it wasn't a far drive. And I remember you telling me, like, it's not necessary. You don't have to do this, Tate. You don't have to drive out there. But I was like, you know what? Why not? I want to see what I bought. Like, I spent all my money on this. Let's go take a piece. Let's go take a look at this piece of Arizona. We drove out there, I remember, with my missus, and we got to where the GPS said to turn right, and there was no road. Like, nothing existed. There had never been a road there. So I'm panicking. I'm thinking, like, what have I purchased? You know, I already owned the deet, so it was mine. And I'm just. I'm going through that, like, worst case scenario of like, oh, man, if I can't find it, how is anybody else going to ever buy it? Did I really just waste my money on this? And I remember I had this, like, moment of, like, just take a deep breath. You'll figure it out. And we ended up finding another way. It took twice as long as GPS said it was gonna, but we got there, and honestly, it wasn't anything special. Like, it was. It was just. It was nothing special. Like, I wish I could tell you it had this beautiful vista or great views or that there Wasn't trash on the property, but it had all, you know, it had trash on it. There's some shotgun shells, but it was nothing special. And I remember thinking, is it even worth. Do I want to use these pictures in my future marketing? I found a way to get to it. I thought, you know what? I'm going to take some photos. All right? We took photos, tried to make it artsy, tried to be there around sunset. So it was. It was kind of nice, but it was just desert, flat land. And came home, came up with some marketing, came up with a, you know, a direction that we wanted to take on that property. We ended up selling. I don't remember the numbers on it. I don't remember how long it took, but I know it's not in our inventory anymore. It's been deeded to somebody else, and we made money. But my first Boots on the Ground experience was probably a lot like a lot of other people is where it was like, man, it looked better on gis. It looked better on Google Maps. And then I got there, I was like, who's my wife said to me, who's gonna want this? And I said, I don't know. But Mark Podolski says, if it's irresistible, it'll sell. That gave me all the confidence I needed to proceed and go nuts with the land business.

Yeah, you're. You're lucky because I did not have that experience. And so I had to. I had to spend. I didn't spend it. I. I had to basically lose out on $50,000 to learn this lesson.

Wait, so your Boots on the Ground experience cost you $50,000?

$50,000. And so I'm out with my buddy in Las Vegas, New Mexico, and I think this is like 2000. Is this 2001 or 2002? 2003. It's early, early days. I just started land investing, and at that time, I'd only been to going to tax deed auctions. I never, you know, was acquiring property just through our direct mail process today. And so back in those days, it wasn't. No one was really at those auctions. And so, you know, there was this opportunity to buy properties in New Mexico, in Las Vegas, New Mexico, where there's like a university. Okay. And. And then it was like you could go and buy it over the counter. So when that means that this went to tax deed auction, and no one bought it for the prices of the back taxes. And so then it's called you can buy it over the counter. And so essentially, it's like, it was 50 bucks for, like, an acre. And they had dollars. They had a hundred of them to buy.

Okay, so I think I see where you're going on, why this is a loss. All right.

All right. Yeah, yeah. So we. So, of course, like, let's go do our due diligence. So we drive out, and we started looking at these parcels, and it looks like Chernobyl to me. I mean, picture the most desolate, ugliest desert property you've ever seen with, like, a sliver of a road. And just like you, I'm like, who is going to buy this? And. And do I even want to sell it? Like, I don't even feel good about selling this. And my buddy did not have the same sort of land snobbery that I had. He was like, well, you know, it's 50 bucks. He's like, you could flip her for 100 bucks, and you can double your money. I'm like, yeah, if I do that, I've got to still deal with an unhappy customer when they come out here. It's not worth the headache to deal with. And so I said, look, because he's like, let's just split it. He's like, you buy 50, I'll buy 50, and, you know, 2,500 bucks each, and it's fine, right? And so I was like, no way. I'm like, two things are going to happen after because he keeps buying it. I'm like, you're going to get refunds or you're going to get lawsuits because they're going to be so disappointed with this land. So he goes, he buys it all, and sure enough, he starts flipping it, and he's selling it for, like, a thousand bucks. He's going like. He's like, flipping it on ebay at the time, and for an acre was a thousand dollars. And he's showing pictures of it, and, you know, he's showing the maps. He's not, like, making it look any better or different than what it actually was.

He's being honest.

Yeah. And so he'd email me the sale, and I'd email him back. I'm like, refund. And then he'd get another sale. I email him back, refund, slash lawsuit. And. And so this goes on and on and on, and he sells out right in front of me, and he makes a hundred grand doing this. And so that was when I learned, okay, I'm not the buyer. There's a pig for every barn. Just because I hate this property doesn't mean at the right price, someone else won't love this property. And he never got a refund. Of course, he never got a lawsuit. And that was a $50,000 lesson. Like, you know, and I only talk about this today, like, yeah, I don't eat McDonald's, but a billion people love it.

Yeah.

It's just not for me.

That's interesting because, you know, you really kind of peel back the layers on that. This is a place. This is a classic case of like paralysis, right? Over analysis led to paralysis. And because you went and got too maybe sophisticated with the approach of like putting boots on the ground and not just looking at the numbers and saying, I'm buying. Like, you think about that. You were buying an asset, a piece of real estate for $50 an acre, right? I don't care where it is, right.

I mean, the taxes were like three bucks a year or something.

Like, if that's that time, I don't care where it is, I don't care what's wrong with it. I don't care if there's never been a road to it. I don't care if you need a helicopter to get to that property today. I'm buying it.

Yeah.

And I would have bought a hundred. I would have buy a thousand of them. Every single one of them. You're not going to get feed to death, right? Like, that's the one thing that's. We don't talk about on the land business is traditional real estate. If you buy a house and you fix it up, you've got this carrying cost, right, of the mortgage and you've got maybe your debt that you're servicing and the interest and the HOA fees and all these other taxes and things that kind of eat into your profit in the land business. Your fees on that asset was $3 a year. The guy got a tax bill for 300 bucks. Think about that.

Right? Right. He can't.

You can't say, oh, I, I shouldn't buy these because of the taxes. That's crazy.

No, it was crazy. And so, and it's, and it's so true. Like, like all we're doing really, because it's not like there's nothing there, anything I had to protect, anything maintain. It's not like, you know, like you like, oh, I'll buy a house in Detroit for a dollar, right? You know, in a terrible neighborhood that I can't go visit. That actually, you know, is, is a problem to deal with. Like, this is no problem. Like, we're just shuffling paper, but. And I'm not. I wouldn't, you Know, misrepresent it and say it's something that's not. And I even think for marketing, it's high. It's better to highlight the flaws. And they come in like, oh, my gosh, this guy's saying, this is exactly why it's so inexpensive.

You know, somebody out there, when they buy that property, they're checking a box maybe.

Yeah.

And maybe that box is, I want to own something outright. We don't know. Right? Like, yeah, people buy our land for all different reasons. You've got some people who want to, you know, maybe the big.

The.

The big reason I want to have a ranchette. I want to have acreage. I want to run cattle. But then you've also got people who just want to buy it because it's cheap. And they didn't know that you could own vacant land for the prices that we bring it to market at. I mean, it's just I. I think that one of the mistakes that people make in this business is they think, oh, there's. There's no way somebody else would want this. And they start thinking about the. From the perspective of, would I want this? And that's not the way we should look at it. We should look at it from a very logical point of view of what do the numbers state? And in your example, the numbers made sense. Like, who cares what it looks like? Your buddy was right. Buy it for 50, flip it for 100.

Right? Yeah. Like, that's like. Like the liquidation values. Like, there's no way I'm losing money on this. Right.

I think that goes back to, like, some of the stuff we teach in flight school about how to price property and how to do it correctly. And if you do it correctly, your risk when it comes to buying this stuff is basically zero. Right. If you know how to do due diligence. Right. And you know how to price property and you know what the market is saying, what are you afraid of?

Yeah. No 100%. And even if you were, like, really, really scared, you could just test it on ebay, even today. Just do an auction and see what the market would, In a competitive auction, would do. Even if they don't. Even if they don't buy it, it's like, okay, I'm not selling it at that price. Like, you said it, like a reserve. But then you just see, like, oh, here's what the market would. Would buy based on this ad.

I like, 50 times 100. I'm from Vegas. Right. That's like a bad night out or a good night out. On the town for some people. Right? Like, right. You can't put, you can't replace the toilets in a rental property for that.

No, but, no, but for me, it wasn't the money.

No, I know, it was, it was.

Like, it was the fear. Fear.

Well, that's an interesting one, right? Like, does fear drive our decisions? And I think as entrepreneurs it can, right?

Oh, it absolutely can. I. I think that, you know, that is the, the big thing that in entrepreneurship and probably in life, if you can face your fear and get over it and take action, take skillful action, not emotional action, not react and really kind of have that just clarity. Even in the midst of fear, you have a superpower. You see it with investors. A guy like Warren Buffett, the world is falling apart. He's just clear eyed. World's falling apart. Okay, time to buy and let's buy big. Like and. But you know, it's so easy to say when, but when it's your money and it's, you're in it and it feels crazy and you don't know where the bottom is, it, it, it's harder to actually do.

Right.

I think it's really easy to say what, you know, buy when people are fearful and sell when people are greedy. But it's not that simple. If it were, everybody would be right, you know, rich, and they're not.

That's interesting. Speaking of memory lane, can I. It kind of brought up a story of one of my first coaching clients. And I just want to share this real quick because I think we talk about, you know, how big we can take the land business and what we can do with it. And it's kind of interesting. When she joined coaching, we do something called a strategy con. In that strategy call, we basically set goals, set a deadline for it, and then we reverse engineer the numbers based on fact, you know, based on facts and, and performance. And we set these clear boundaries of what you're going to need to do every single day to hit these goals. And we've gotten pretty, pretty dang good at accurately determining how long it'll take you to reach your goal. And I remember I set the goal with her. I was like, so how much money you want to make in the land business? She's like, I want to make $5,000 a month. I was like, that's it.

5,000Amonth in passive income, right?

5,000 in passive, right. And I remember saying, like, well, how long do you do it? She's like, if we could do that in two years, I would be ecstatic And I'm like, well, we can do it in a fraction of that time. She's like, yeah, but you got to understand, I'm building a land business because I want to live the lifestyle of a land investor. I don't want to work 40 hours a week. I know we could do this in a fraction of the time. But what's important to me is I want to be able to be a good mom. I want to work on my land business exclusively during nap time. That was her. That was her requirement was like, I'm not doing it outside of nap time. And I went, you're going to miss out on deals both on the buy side and the sales side, because real estate never sleeps. She's like, okay.

And she was totally okay with it.

She was okay with it. I was like, all right, well, let's do it. Long story short, about seven months later, she hits her passive income goal.

Wow. How could she do it working so little?

She picked good areas. She made decisions based on the numbers and facts. She had, you know, a solid mentor to help her and.

Right.

Shameless. Plug in there, right? Like, she. She picked good areas. She knew how to read the market. She knew how to make decisions based on what her end goal was. And most importantly, she leveraged other people's time. Right? So she just came in.

Well, that's. Well, that's where the good mentorship comes in. It's like, you know, here, this is what you need to do, and these are the people you need to hire.

I was like, you can't. You can't be taking. If you don't want to take sales calls after this time of day, you're going to lose money. So we need a sales manager. She's like, okay, let's do it right? It was like, black or white? It was like, okay, if I need to do this, then let's do it. Okay. Easy. Very coachable, right? So she hits her goal. And I remember we're talking, we're celebrating. I said to her, all right, let's do it again. Let's do it again. She said, tate, remember, my goal is to make $5,000 a month. I'm like, we did that, right? Let's do it again. Let's do it to 10. She said, not right now. I'm living my dream. I'm making more than enough money to cover the minivan payment, to help pay the mortgage, and most importantly, go on a sweet family vacation every single summer as a result of the land business. She said to me, and I remember this vividly. It was like a great learning lesson of, like, I want to cherish the time that I have with my loved ones right now. I can make more money later. I know what to do. I know how to turn the volume up to 11 in 10 years from now, in 12 years from now, in two months from now. Right. And, you know, going down that memory lane of just sometimes we have to take a step back to realize that to make $2,000 a month in passive, that is not an insignificant amount of money. $5,000 a month, that's amazing. That changes most people's lives. That might not be your end goal. You might want to make 50,000. Okay, no problem. You can do it. But it's just cool to look at that and think, like, first person I helped kind of retire from the real.

World, you know, that's amazing. That's an amazing, amazing story. And it just. It makes me think about so many of our clients who had different unique goals, they had different paths and ways they got there, and it's, It's. I mean, this is why we do it. Like, it's just so gratifying. It is. You know, we were celebrating last week. Our client, she. She quit her job, and that was her goal, and she did it in 11 months with your mentorship and a big job, like six figure income and, and, you know, just tremendous. And she's gonna come on the podcast, so I don't want to steal her thunder, but it's just. But it's just like, just such a. A nice reminder of. Of why we're doing what we're doing and the impact that we. We can make in. In the mentorship. And, and also we get to, you know, meet and, and work with Olympians. Silver material. Let's give it up for Austin Krychek for doubles tennis.

I mean, amazing, amazing, amazing. It's crazy to think that, like, the reach of the land business is that big. From the United States to Paris, right?

Yeah. Yeah. I'm gonna get him a. A Land Geek hat to wear and, and rep. That'd be awesome. People are like, wait, what's. What's Land Geek? But you know that. So that's really pretty cool, too. Well, this is a really fun trip down memory lane. But, Tate, it's just you and me. Do we. Do we have a tip of the week? I actually have a tip. Could be a huge game changer.

Huge.

All right, well, are you ready for it?

Look, you know, when Mark Podolski says it's going to change my life, I pay attention. I'm not. I'm not. I'm getting out the pen. I'm ready to write it down. I'm taking notes. Give it to me, baby.

Okay, okay. So before I give it to you, just a quick shout out. Today's podcast is sponsored by flight school. Learn how the next 16 weeks can really start changing your life. Solve your money problems, solve your time problems with that passive income. No renters, no rehabs, no renovations, no rodents. Meet with one of our land investing experts and work with them to see if this business is right for you. I know you're thinking, oh, what about the tuition you're gonna cost? You nothing guaranteed you're gonna make it back 180 days or less. Just show us you did the work. Go to Langeek.com forward/training and schedule a call with one of our land investing experts. Experts. I don't know what I just said there. Thelandgeek.com forward/training. And I'll try to say it again. Meet with one of our land investing experts.

Experts. That's a. That shouldn't be a hard word. But it kind of works. It shouldn't be.

I kind of tripped over it. So. All right, here is the tip of the week.

Give it away.

Ready?

Yes.

So what makes this tip of the week so great for me is that it's Mac only.

Okay.

You gotta have a Mac.

I'm if you're interested.

And most people who are listening to this podcast have a Mac. I'm pretty sure it is a downloadable. Free. Free.

You just said my favorite words. Mac only and free. Okay.

Okay. It's called talk Tastic. So you go to the App Store. Or you could go to talktastic.com maybe it's talk. Let me just make sure I've got this.

Yeah. Talktastic.com okay.

Go to talktastic.com. download Talktastic. And my. So my shortcut is control spacebar. So instead of typing something, I can talk it. And so then it transcribes it. But then more importantly, it uses AI and cleans up what I just said. And then I can paste it into any. Like, if, like whatever I'm working in, it just pastes it. Pastes it, like, automatically knows what application. So it works in every application you use from your email to Google Docs, to Slack, to whatever it is. And I think it's fantastic downloading it now. Yeah. So I was working on Dirt Rich 3, the Zen geek book, and instead of typing, I just started talking and then I used the AI. I'm like, oh, my gosh, that's really not a bad paragraph. Kind of cleaned up my vomit draft really quickly, and it was pretty easy.

I'll take any help I can get when it comes to grammar.

Right.

Than me.

Yeah. And so I think. I don't know if this actually replaces like. Like a Grammarly yet, but I think as far as, you know, getting your. I just. I think. I think for some people, it's easier to talk than it is to type.

Yeah, for sure. That's why things like WhatsApp are so popular, right? Because you can just hold down the button. Talk.

Yeah, hold down and talk. So that's. That's the tip of the week. That's cool. I'm glad you joined. I did not want to be on the round table with no table. So you saved this week's podcast. Thank you.

It was fun. It was fun.

It was great to go down memory lane with you. How funny. I. I can just picture you and Allison at that road. Where's the road?

It says, like Matt said, turn right. It's like there's nothing. There's. That is death out there. If we go out there in this old Kia, we're not coming out. No way. We're coming out.

Yeah. And dear listener, if you're getting value, you know, and you love someone in your life, share this podcast with a friend, a family member, someone special. Share the love. Help them out as well. Follow rate Review the podcast. Send us a screenshot of that. Review supportlandgeek.com and as soon as Dirt Rich 2 is published, I will send you a free copy of Dirt Rich 2, how to scale your land business. Without missing a beat, the plot thickens, which is. Almost done. Almost there. I'm.

I'm getting a signed copy too. Right. I better be on that list.

I'll sign yours twice. You. You get. You get a box. You'll get too many of them. I'm like, hand these out to friends.

Yep. Stocking stuffers for all my buddies.

There you go.

Bad idea.

Actually, you're prominently featured in the book, so, like, of course, Tate's, you know, handing this out.

A little bit. Like, I need that.

Exactly. All right, are we ready to do this?

Let's do it.

One, two, three. Let's.

Freedom ring. It's pretty.

It's pretty.

Pretty good.

It was just two of us.

It was good, but it could have been, you know, I miss the other voices. I miss being out of sync, you know, I know the listeners. Yeah, yeah.

It'S. It's all good. It's all good.

Everybody else is living their lives, their big lives. Right. That's good.

I know, I know. So, you know, we're in the middle of summer. It's hot in Vegas. It's hot in Scottsdale. What. What's the secret to. To surviving the Vegas summer?

Leave, if you can.

Idaho.

Yeah.

North.

That's what the secret is. If you can't a pool, that is big helper. Otherwise, you know, you just got to put your head down and bear it.

Right.

Like, yeah, it's three months. It's real pain.

Yeah. I was up this morning like around five, and I'm like, I'm taking like a walk, three mile walk, and it's like my back is dripping with sweat and it's like 90 by the time I'm done with that walk.

Yeah. It's just. And. And August is always one of the hardest months. Just because you're done, you know, you're like, okay, yeah, in July, that. That was pretty miserable. But August rolls around and it's like, oh, you thought. You thought it was going to be fall? Forget about it. No, that doesn't exist.

No. I'll tell you what the dirty little secret is out here is it really doesn't break until Halloween here.

Yeah, yeah, we, you know, Halloween will roll by and my kids will most likely be trick or treating in shorts.

Yeah. Yeah. 100.

They could wear pants, but the only reason they'd really wear pants is because mom wants them to. Mom wants to make the photos look like it was fall. But it's not falling. It's still summer.

Right? Right.

It's hot.

Awesome.

All right, brother, I'll see you next time.

Yeah, thanks, brother. See you.

Thanks for listening to the Art of Passive Income podcast. Are you ready to learn how you can start building a passive income without renters, rehabs, renovations, or rodents? Schedule a free consultation at the landgeek.com forward/training. Let freedom ring.