Strategies For Buying Wholesale Land

Hey, it's Mark Podolski, the land geek with your favorite niche real estate website, thelandgeek.com and on this week's roundtable, we've got all the usual suspects, minus Mike Zano. We've got the technician, Eric Peterson. Eric, how are you?

I'm living in the Arctic here in Tennessee these past couple days, but all is good. We have, like, I don't know, 2 inches of snow on the ground, and that's a lot for us.

Wow, that's Scott Bossman. Right now is just. Yeah, I know it. We got dude, buddy, nightcap OG Scott Bossman. Scott, how are you?

I'm doing well. I Wish I had 2 inches of snow on the ground and it was 30 degrees, trust me.

What is it there now?

Well, it was minus 15 this morning. That's without the wind chill. And we have, I don't know, a couple feet of snow on the ground, so it's nasty.

Yeah, we'll talk about later, but there's this new thing called U Hauls, and you just move somewhere warmer. We got Terea putting in the rep service. Teria, how are you?

I'm well, thank you.

Good to see you. We've got a very relaxed angler. I love it when you call me Big Papa. Tate. Litchfield Tate, how are you doing?

Well, can't complain. Yeah.

And last but not least, we've got the brain, the professor, your flight school Sherpa. Scott Todd. Scott Todd.netlandmodo.com Learn anything about anything. Investor ninjas.com Scott Todd. How are you, Mark?

I'm great. How are you?

Pulse is still normal. Respiration is fine. I can't complain. I'm very excited to discuss this week's roundtable topic that comes from our own land geek group in the main networks. So our topic this week is from one of our members. Want to know he's uncertain about buying land wholesale. Just the entire experience of it. He's had talks with a few wholesalers and. And when he looked at other ads for similar land, he found he could make the desired ROI as described by Scott Todd in the video. So I'm assuming he's a flight school student.

He is, yep.

I feel like they're asking too high a price for wholesaling. How or what has your experience been so scath. How would you reframe this question to give everybody sort of a. A bird's eye view of just the wholesaling experience?

Okay, so what. What I teach is that when you're looking for land wholesale, I think it's my own opinion and my own rule of thumb, and I think that most people would. Would agree with me, and that is the fact that you should be able to double your money when you buy a property wholesale. Now think about this. If you're, if you own a property that you want to sell wholesale, well, you're making the quick buck to get out of it today. Bam, it's gone. You don't have to worry about it. You don't pay any property taxes. You don't have to do anything else. The person who is now buying it from you, well, they're going to have to own this thing for a while. They have to do the hard work, the mail or the marketing and the note collections and all the other stuff. They should be able to at least double their money, in my opinion. So. And we're talking about the cash price, by the way. So if a property is selling for $6,000 cash, in my opinion, that property is worth $3,000 on the wholesale market. I think that's fair. Now, if you bought the property for, you know, 2800 and you're trying to make the math work to where you double your money, well, that's not, that's not going to happen. The other component to this is that, you know, if you bought it for 20$800, you're trying to wholesale it. Well, $200, you're getting rid of it today. You just printed $200 cash. So you have to think about this when you're mailing, am I going to wholesale this thing or what am I trying to do? But to go and to try to double your own money, I don't think that's right, but that's my own opinion. So the strategy I teach is you want to buy land wholesale, look for properties that you should be able to double your money with. So that's. That's the core of the teaching principle.

Okay. So, Scott Bossman, what would your advice be to this young Padawan in flight school that's worried about wholesaling? Well, you're on. You're on mute.

Sorry about that.

There you go.

So.

So I can. I can kind of relate to what he's saying. I've noticed recently that there are some aggressive wholesale prices out there now. The market is a little bit more aggressive lately as well. I guess I feel there are two things that kind of twinge in my side sometimes when I see wholesale properties. One is if people are trying to charge a doc fee, especially in our community. We've talked about that. That we don't like doc fees. It's not customary to charge a doc fee. The second is when I look at a property and I'm like, well, there's no way I'm gonna be able to double my money cash on that deal. Now, this is from somebody who knows the market in certain areas where I'm working. That being said, there's nothing wrong with communicating with that particular investor and saying to them, listen, I'm seeing cash prices at this. Would you accept half of that as it goes, according to what Scott Todd teaches in flight school? So I can see that for some people, it might be a little bit confusing or a little bit of a challenge at times, maybe if they don't know the market so well or if the prices just aren't seeming to add up to what they're finding in their analysis of things. That being said, I think drop them a line and talk to them about where they're coming up with this price.

I like it. I like the advice. Taria putting in the reps. Harris.

I agree wholeheartedly with Scott. I also think it's twofold. I think, one, before you set out to purchase, you know, wholesale property, you're going to have to do your own due diligence. You're going to need to know what the cash values are for those properties. So then you know what to expect when, you know, you're negotiating. I think there has been a lot of aggressive wholesalers, as Scott mentioned. The prices are going up, but I don't think. I think when you are armed and you know your stuff, you have a better chance of approaching that wholesaler and saying, hey, based on what I see, you know, here's a price that I can offer, and then it's up to them to take it or find another wholesaler. Like, there are wholesalers, a lot of them, in our community, or even on Lamboto, you can go on there, find a property. And we've made offers to purchase wholesale properties, even ones that people had listed, you know, for terms. So there's no shortage of, you know, wholesale properties you can get. You don't have to stick with someone that you feel is, you know, a little inflated.

Yeah, and I really like what you just said there about making offers. And we were talking about this even before we were recording where Scott Todd was like, hey, make an offer if you don't like the price. There should be some wiggle room in there with a wholesale price. It's especially aggressive if they're going to sell it. So you certainly don't have to take that price. But I'd love to know what Tate Litchfield's thoughts are.

Right.

I agree with what everyone said, but I'm going to play devil's advocate here, because sometimes the person wholesaling the property knows more about the area or what's going on in that area than the person who's trying to buy it does. For example, there's an area where a lot of us have had success in, and the availability of extremely cheap land has become. I don't want to call it scarce, but the price has just gone up. And so if you come in and say, ah, no, there's no way I'd pay X price for that property when, you know, two years ago I bought it for 40% less than that. Well, you really are a little bit out of touch with the current state of the market there. So I really like what everyone said, and that's why it's important to have that kind of open conversation. Like, I've done deals with Eric, and I said, well, why is it this price? And he said, oh, look, it's hard to get land here right now. And when you do see the property, it sells quickly. Or this property has trees or seasonal creek or it's near. It's a quarter mile from the river. It's like, yeah, sure, go ahead and buy something cheaper. But this is a premium lot, and it comes with a premium price tag. If you don't like it, that's okay. And so I agree. I mean, at the end of the day, make an offer. This is business. Don't get offended. Don't choose to take offense when somebody lowballs you or says, you know what? I'm not working with he tape. Okay, no problem. I'll sell it retail. Doesn't hurt me at all. I have people tell me all the time, yeah, I'll go buy it from someone else. How about it?

Well, I'll tell you, when you deal with Eric Peterson for wholesale, it's a very different experience than what I do.

Yeah, Eric.

Because he'll give you an explanation like, well, I'll ask, why is it this price? Because I said so. And then he just hangs up.

Well, Eric typically just says, oh, it's Mark calling. Yeah, Everybody raise it 20%. You know, Mark Godolski's on the phone.

But even then, you're still making money.

I wait for him to call back because I know he will.

Yeah, yeah, exactly.

Normally, send a blank check. Mark, send a blank check.

So, Eric, the technician Peterson, what are your thoughts? On this whole wholesale.

Topic.

Well, first, you know, I kind of agree with what everybody has said, but I guess, you know, what I want to start with is that markets change, right? The market goes up, it goes down. It's going to move as time goes on. Right now, we've talked about it before. It's hard to buy land or harder to buy land than it has been in the past. People are tending to hold onto it a little more tightly. Sometimes we're having to pay more for land that on the other side is driving up pricing. So I think, number one, it's extremely important to be really up to date with the market. If you're looking to buy property wholesale. If you're planning to buy wholesale today, go out and look at the market today. Don't rely on the research or the pricing matrix you put together last month because it may not be accurate in the current market. And then I think the other thing is because of demand, there's lots of buyers out there. There's fewer sellers out there. Someone that's going to wholesale a property, they might ask for a higher price because they know they can get it, because people need land to sell. So while it is a good rule of thumb to expect that you're going to purchase a wholesale property for about half of its cash value, as the market swings back and forth, there may be differences in those amounts. Maybe it works out to you got to pay 60% of cash value or some other version thereof. But I think you have to look at it as the buyer. You have to understand the market and realize, can you make the return you're looking for on this investment or can you not? If you can't, obviously it's worth trying to negotiate. I'll say that not all wholesalers are going to negotiate with you, but you can at least ask and if it doesn't work for you, move on to the next one. Okay, if that means that that seller, that wholesaler, isn't going to sell their property, well, that's, that's their own choice. You know, there's, there's lots of land out there. It is maybe more limited, but I think there, there are choices for those that, that want to do the work.

And go out there and find it.

Yeah, I really like that point. And not to steal Scott Todd's thunder, but it, it is a thing. When you get into flight school or you get into the investor's toolkit, you have this disease called I gotta have landitis. And never in your life did you have to own land and now, you know, you're more likely in that very beginning stage to overpay on a wholesale deal. I would say at that point, if you're really a newbie, you don't know the area, you don't know your pricing. You're skittish about it. Look at go on the my network stream. Who can do land arb with me? Land arbitrage is such a simpler way to go than wholesale in the beginning. We've done several podcasts on land arbitrage, but just to give you a quick overview, you're essentially controlling a property at a very low price, and you don't have to use a lot of cash. And then you're flipping it at the terms price and you're making the spread. So you might buy it from Scott Todd for $100 down $100 a month. Where the market is saying you can sell it for $200 down $200 a month. You make that spread of $100 with very little risk. If you can't sell it, you're out maybe a hundred bucks. Right? Scott Todd, I'll give you the final word on this because I stole your thunder and I apologize.

Okay. I would say, look, there's a couple things, and it's already been talked about, but just to reiterate and summarize and add to everybody on land, Moto is a land investor. Make them an offer. Okay. The worst they're going to tell you is no. I've been told no. I don't know too many times in my life to even count. How many times have you been told no? It's okay. It's just a word and we keep moving on. No, I just told you no. So go and make an offer. You might be surprised. I think that the other thing that was mentioned is I think Tate mentioned this. The land investor might, in fact know more about the area than what you do. So your math might be wrong. Okay, now this brings up the discussion point. Hey, look, I'm looking at this area, and I think that the cash price is this. So my offer is going to be this. Am I missing something? It's a question. And the land of us say, yeah, man, I'm selling these things for, you know, 20,000 cash, not 10,000 cash. Oh, really?

Wow.

Go back and redo your work.

Okay?

Like, it's like you just learned something potentially. Or maybe you're just wrong. Now, you could be looking at a property that's in this subdivision, and These sell for 20,000, but you may not know that there's a difference. You just learned something about the market, potentially. You have to go validate that stuff. So it's a learning process, but you've got to continue to move forward. And I would just say that there are lots and lots of wholesale land. There's not a scarcity of land or scarcity of wholesale deals. So don't, don't talk yourself out of the game. Make offers. It's not a layup. Just make some offers and see what happens.

Fantastic. Fantastic. And I think next week we're going to just rehash the entire wholesaling paradigm, if you will, again, and walk everyone step by step through this so it's really, really clear. So the do's and don'ts of wholesaling, I know we've talked about it before, but I think, you know what's the seed of learning? Repetition. Is that right through you? Yeah. As I'm getting older, I'm finding I'm losing words. So nice to have the help. Nice to have the cognitive help with all of you. Well, I thought this was a great discussion. We're now at that point where we're going to pick on Tate Litchfield for the tip of the week. But before we do that, I have to just give a shout out to our sponsor this week, which is Flight School. Learn how the next 16 weeks can literally transform your life. Start building your passive income machine with none other than Scott Todd, who's done it thousands of times, taking you up the mountain of land, investing quickly, safely, efficiently. Oh, by the way, that tuition, it ain't gonna cost you nothing. We guarantee you're gonna make that money back 180 days or less. Just show us your work and learn more. Go to thelandgeek.com training. Get on the horn with dude buddy Nightcap, OG Scott Bossman or the Zen master, Mike Zana. All right, so, Tate Litchfield, what is your tip of the week?

All right, so I'm going to show a little love to my dear friend Scott Todd, because most of the community doesn't know this, but Scott Todd has got a YouTube channel, and it's really good. I don't know if he posts daily or weekly or anything like that, but if you haven't subscribed, go ahead and check it out. Most recently, he did a video on applying for the PPP stimulus check, and it is really, really good. Guys. You guys need to be watching that. You need to be subscribing there. Scott, you know you have my address, so you can send that payment in the mail. But no, I'm kidding. It is a really solid platform. I've been watching his videos. I've subscribed. Check it out. He talks about things such as why Tom Brady is successful. He goes into simple things like how to scrub a list better, achieving financial freedom. Check it out. Most of his videos are, what, five to 10 minutes in length, right, Scott?

Yeah.

Not too long. And just to make it a shortcut, Mark and Tate, we can just. If they want to learn more, and I appreciate Tate. Check is in the mail. You can go to scotttot.netforward/YouTube, and it will take you right to the channel.

Yeah, it's good stuff. I was going to talk to him privately because I think he needs to start putting these out at least once a week. But I know it's not easy. It takes a lot of work, right, Scott?

It does. And there is a schedule where it's gonna be once a week.

So go over there and check it out.

Scott's upping his video game, which means we all have to up our video games. So, you know, it's good. All boats rise with the tide of Scott Todd's genius. We all have to get better.

Thank you.

I like it.

That's great. Which means that, you know, we all have to invest in better cameras and equipment. I'll never get a Surface, but I'll get, you know, better equipment.

You can compete.

Yeah, but admit it, you're video editing on the Mac.

No, I'm not.

I think in his most recent video, he. He talked about how the Mac was such a seamless video editing platform. Right. I think he said that something to the extent of, oh, wow, this went easy.

I think you must have me confused with somebody else. I don't know.

I don't know. Check it out, people.

You'll find.

Eric, does the Surface even have video capabilities?

It does.

I don't think you can even open.

A video file on a Surface.

I don't think so.

It's only for using Word and Excel, I heard.

Yeah, Excel will give you all day long.

I'll tell you what. I will. I will. Should we have a. Should we have a challenge? The surface versus the crappy Mac? We can have that challenge.

Next YouTube video.

There it is.

What do you say?

That's the next YouTube video.

Next YouTube video.

There you go. That's it. Yeah.

His VA is using a Mac. There it is. That's the secret. Like, Scott Todd's editing his own videos.

I do edit these videos. I do. Yep.

All right.

Well, I want to thank the listeners. And hopefully you guys are putting up with our shenanigans. And if you are and you're getting value out of it, the best compliment you can give is if you subscribe. Well, first of all, you gotta subscribe, rate, review the podcast, Send us a screenshot of that review. To support thelangeek.com we're going to send you the $97 wholetailing course, how to double your money 30 days or less for free. So please do it. All right, are we ready to do this? 1, 2, 3. Let freedom, freedom ring, ring. Not bad, not bad. So, speaking of freedom, Tate Litchfield, what was it like out in Belize on the boat and fishing with your dad? I mean, do you have any good stories for us?

You know, it was nice. It was a great trip. Spent a week down in the sun. No rain, no bad weather, a little bit of wind, but that's pretty good. Chased some really fun fish and some really frustrating ones as well, but overall, it was pretty. Pretty awesome trip, you know, and every time I go on a. On a boys trip or a vacation like this, I come back energized. But more than anything, just grateful, right? Like, just grateful for my line of work. Didn't have to get my vacation approved. Secretly, I was hoping that I would test positive for Covid so I couldn't get back into the country and have to stay there for another two weeks. And it was like, yeah, if that happens, guess what? My wife will miss me. The kids will probably forget who I am. But at the end of the day, it's not like my boss is going to get mad at me, right? Like, I have a computer. I can make it work. So. Just kidding. But it was a great trip. And one of those moments where you go, yeah, this is what I want to do for the rest of my life. And I'm not going to get distracted. I am a land guy through and through. I love it. Best business ever.

Amazing. That's amazing. Yeah, I think, like, we were talking about that networking event in 2021, maybe even 2022. I really think we all need to learn how to fly fish. I think it's just a.

Let's do it, man.

Yeah, that'd be really fun. Drew, you're down.

I'm afraid I would be down. I have no idea how to fish.

It's all right. It's. It's not even about catching. You know, you got to go to these epic places, spend time in the mountains. Just the beauty of it, right? The quiet. You're sitting there on a river, even if you're not fishing and it's just quiet. You're looking around and nobody's bugging you. There's no cars, probably don't have cell phone service. Or in my case, you're on a remote atoll in the middle of nowhere, just loving life. There's manatees swimming all over the place. There's just. It's just beautiful. So it's a great hobby. It's a great sport to get into. Highly recommend it.

I think it'd be a great social experiment just to see Taria away from slack and just see, like, what the withdrawal symptoms would be like.

You hang out with me too much Terea and I'll help you overcome that. No problem.

I'm looking forward to it. You guys set it up. I'll be there.

All right, well, thanks, everybody. See everyone next week.

Bye.

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