I wanted to provide an update on my first mailer. I joined land academy as a silver member in mid-December, and my first mailer went out the first week of January. Last week I received a call from a seller, and his message was clear, “I accept your offer.” During DD, I found that he owned four more properties in the same area. I called him back to discuss the other properties and he agreed to sell them all.
Now for the best part! I purchased five parcels, 39.4 acres total for $16k. All five of the parcels are over 4 acres and the cheapest 4-acre parcel for sale in the area is $49k on Landwatch. The cheapest 4-acre property sold in the last six months went for $42k. Recent comps suggest that at least one of the parcels has a market value of over $100k, I paid $3k for it! INSANITY! One of the other parcels is 8.1 acres and doesn’t have road access, but is accessible by ATV via and old logging trail. I wasn’t thrilled about this one, but I wanted to go easy on the seller for giving me such a smoking deal, so I just bought them all.
Yesterday I got on craigslist and found someone who was looking to buy a lot without road access but was accessible by dirt bike. I called him up and he said he was hoping to find an acre for $10k. I said, “how about 8.5 acres for $26k?” I have a feeling the guy thinks I’m on drugs, but he’s meeting at the bank tomorrow, so it appears I’ll be up $10k on day 2 of this deal. If I sell the rest for half of the market value, I should walk with over $100k on this deal, but I’m just happy to have the ball moving in the right direction.
My first mailer targeted areas within one hour of where I live, simply because I know these areas well and have a network of investors and agents already in place. I knew that if at least one deal came back, I would most likely be running to the bank assuming the property had access. The most significant challenge I’ve faced thus far is trusting technology (google earth, GIS) instead of going to look at the property in person. My wife says I have control issues, but she never says what I want her to say anyways….. Deep down I know that I’ll never be able to scale this business if I don’t learn to trust google earth and my data. My biggest win, besides the insane ROI potential on this deal, is that I didn’t go look at the properties even though they are less than an hour from my house.
Perhaps I’m experiencing beginners luck, but I’ve been sending out a mailer every two weeks and plan on sending 6k out on Monday, so only time will tell. I have a background working with Nielsen data and have been pricing consumer packaged goods for different markets for over 15 years, so I felt confident with my analysis. I’ve even gone as far as running linear regressions on the data set to determine what the cost per acre would be in a perfect competition for a neighborhood. Is that relevant or necessary? Hell no, but if anyone is going to be an expert on pricing for an area, I want it to be me. Believe it or not, I’m an extrovert and have been in sales all of my life, so if anyone is struggling to get their first mailer out, feel free to reach out. I may not be able to help you get from 2-100, but I’d be happy to help you get from 0-1.
I appreciate everyone who contributes on the forums; I’ve learned a ton just by lurking through your posts!
BRING ON HOUSE ACADEMY!! Please? Just a taste? I want to quit my job by the end of 2018
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