July 17, 2018 at 9:29 am #18083
Michael WexlerParticipantJuly 17, 2018 at 9:29 amPost count: 2
From your experiences,how much would it cost to start this business and give myself the best opportunity for success?
Including the cost of the course, mailings, membership and of course purchasing land. What would be the minimum target for me?
I am trying to save up enough to get started and I am even starting a 2nd job to fund this project.
Any advice would is appreciated.
Joe SchmittParticipantJuly 17, 2018 at 10:13 amPost count: 111
Jill might tell you $5K. While I think it’s possible to do it with $5K, my experience is that $10K is more realistic.
Membership and the monthly fee – $6K (give or take)
Mailer of 1500 every other month – $6K ($800ish for mailing and $200 for the data pull)
Website – $500 (could do it cheaper if you’re doing it yourself, but it’s still at least $100 and a few weekends of work)
PO Box – $100 to $150 (figure around $12 a month + setup fee)
Misc stuff – $500 to $1000 (Cashiers checks, recording fees, other postage, photographer fees, LLC filing, etc.)
So, just the cost of doing business for a year is over $10K, and we haven’t even talked about property acquisition funds. The good news is that you don’t have to pay all of this at once, and you do make some money once you actually sell some properties.
That said, I personally found that it took a fair amount of time from when I did my first mailer to the time that I actually sold a property for a profit. Like months, not days or weeks. So plan for a big chunk of change to give you a good cushion when you’re getting started. I have personally dumped $15,000 in seed money into my land business and I feel like I shouldn’t have to add more at this point. It’s slowly but surely paying off. I’m not sitting on a ton of money after 4 deals, but I am definitely moving forward. Others may have had different experiences.
It’s worth the effort. Do what you have to do to make it happen Michael.Kevin FarrellModeratorJuly 17, 2018 at 5:34 pmPost count: 1026
Michael – Good question and great advice from Joe. Keep in mind that there are many ways to start this business. First, you should not plan on quitting the day job too soon. You need to work with this for a while to get your business built up. If you don’t have all the funds that you need to do a mailer every month, no problem. Just get your first mailer sent out and work on purchasing your first properties. Get them advertised and sell some of them. Depending on many factors it may take a few weeks or a few months to sell them. Then you can afford to send some more mail and buy some more properties. My first 4 mailers were 3 to 4 months apart because I did not have enough acquisition funds to mail more often than that.
Like Joe said “Do what you have to do to make it happen.”Jill DeWitParticipantJuly 18, 2018 at 2:14 pmPost count: 439Erik S.ParticipantJuly 23, 2018 at 3:37 amPost count: 1
I started with $12k and am about to put in $3k more at the 9 month mark. Not totally necessary but will give some breathing room. (About $7k has gone to education, the rest to acquisitions/operations)
What I’ve found is that this business is not a rocket ship straight to the moon. Even with good education it’s more like a cartoon treasure map on a desert island. Your path that winds around a lot.
I have closely followed the recipe of successful investors and have learned a ton in 9 months. Is my return 3-10x on each deal? More like 20-30%. But I see how the better deals are out there. The learning curve involves trial and error to find the right property types in the right counties. Also the sales approach that fits your personality.
The beauty of this business? Even when I was completely new I still didn’t lose money! Speaks to the strength of this model.
Best of luck MichaelMichael WexlerParticipantJuly 23, 2018 at 11:08 amPost count: 2
Thank you everyone for the responses. 10-12K seems like a lot to get started. I wonder if you maybe you began with less and started seeing income and then reinvested?Kyria BakerParticipantJuly 23, 2018 at 2:10 pmPost count: 138
You can definitely start with less and then build up. We did! It takes longer to get to those high levels, but it’ll happen as long as you don’t quit. We scraped together enough for the program and that’s about it. Not advisable, but we made it work with the help of investors and small deals at first.Tom PParticipantDecember 21, 2018 at 6:54 amPost count: 5
I understand the practicality of more money is better to start but I’m curious as to what @Jill Dewitt attributes the increase in start up costs to – actual land purchase costs rising, properties taking longer to sell, business costs rising or it’s just “more is better”?
Thanks!Kevin FarrellModeratorDecember 21, 2018 at 7:28 amPost count: 1026
Tom – I can only guess at what Jill is thinking (Jack, can you help me here?). Here is my guess based on what has been discussed on this forum and on podcasts where Jill talks about some of these issues. I think that Jill has been coaching new members who have come to her when they get stuck or feel like they can’t get this business going. When she sees people trying to do this on a shoestring she tells them to wait, save money, then start with enough funds to buy some properties. If Jill has seen too many people stalling with $5000 then she may have upped the recommended startup money. This is just a guess. More is better.
In my own experience I can tell you that there are still thousands of desert properties that you can buy for $100 per acre or less and sell for double your money. In my opinion, the people who say they only make 20% or 30% are probably offering too much for the land they are buying. That is an experience thing and maybe a lack of negotiating skills at the time of purchase. No matter, it can be learned so each time you get better at it.
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