With Mark Podolsky (The Land Geek)
How To Quit Your Day Job Flipping Raw Land!
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62 – How To Flip Raw Land with Mark Podolsky (The Land Geek)
Mark started investing in raw land in 2000! Mark started buying and investing in raw land with only $3,000 and no real estate experience.
Mark describes land investing as real estate with tenants and toilets.
The Land Geek is a training company, which teaches people how to get out of the “dollars for hours” mentality and lifestyle. Mark teaches you how to buy investments until your income from them covers your cost of living, and then you shift from working because you want to, not because you have to.
Why did you get into this?
Mark was a corporate investment banker who was miserable in his day job. Mark was sick of being micro-managed and exhausted from the 1.5-hour commute he had to do each day. It got so bad for Mark, he was getting the Friday blues.
Monday Blues: You are dreading work tomorrow.
Friday Blues: You are dreading the weekend will go by so fast and that work is going to come so fast on Monday.
What was your first flip?
Mark had $3000, bought 10, half-acre parcels with an average price of $300. He put them all for sale online and then flipped each one for $1200.
Total Investment = $3000
Total Return = $12,000
300% Return on his investment!
From this very first raw land flip, Mark was hooked. He took that money, went to another auction in Arizona, and was buying lots of acres for next to nothing.
Over the next 6 months, he sold all of the lands he bought at the Arizona auction and made over $90,000!
Why would someone sell land for $300 if they could sell it for $1200 like you did?
It is all perspective.
Mark gave a great example:
If someone were to go in your garage right now and gave you an offer of $0.30 on the dollar for everything that you were not using, you would be so happy to hand it over.
You did not need to go on eBay, take pictures, and handle customer inquiries. This is the same mindset for someone who is wanting to sell raw land.
They don’t want to take pictures, do legal work, communicate with others, etc. They just want the money, quick and easy.
Why Land and not go into building and developing?
Mark’s mentor explained this to him best. Listen in at 6:00 minutes to hear why!
Mark is an inch wide and a mile deep. Mark is not trying to go a mile wide in places he does not have an advantage in. He wants to know one thing extremely well.
Would you consider land investing risky?
Absolutely not! Mark says that they make their money on the buy. At that point, you already know what you are going to make on the deal.
Let’s assume that you own 10 acres of raw land in Texas and you own $200 in back taxes on the parcel.
You’ve just advertising two things to Mark:
- You have no emotion to the raw land (location different)
- You are financially distressed in some weird way because you haven’t paid your taxes
If you don’t pay your taxes, the County Treasurer will auction your property off to a tax deed investor.
At this point, Mark figures out the cheapest comparable piece of land that sold nearby. He takes that amount and divides it by 4.
That is the 300% margin of safety, coined by Warren Buffet!
Usually, 3 to 5 people will accept Mark’s offer.
What are some things you do to screen the land?
Mark will check:
- Title Check for Back Taxes
- Legal Access
- Leans or encumbrance’s
- PLAT Maps, GIS Maps
- Pictures of the property
Once everything checks out, Mark has a built-in best buyer that he goes to right away… THE NEIGHBOURS!
Mark had a really intriguing way of getting the neighbor’s attention by drawing on their heartstrings. He writes a letter to them and mentions the following:
- Here is your opportunity to protect your privacy, expand your holdings, protect your views, and know your neighbor.
If they pass up on the opportunity, Mark will go to his buyer’s list and then Craigslist, which is the 10th most visited website in the USA.
After all, that, if he still doesn’t have a buyer, Mark will try Facebook Marketplace and then land selling websites such as LandMotto, LandsofAmerica, LandFlip, and Land Century.
What is the transaction like?
Mark asks for a $2500 down payment, where he tries to get his principal out.
After that, he will say something along the lines of $249/month at 9% interest for the next 84 months.
If he successfully does this, it is a great transaction.
Gets his money out right away
Makes 9% interest per month
Earns passive income
No renters, rehabs, renovations, or rodents.
Create enough of these notes where your passive income from the land is greater than your job income and you can successfully become independent of your day job.
How many of these deals do you do a year?
Marks goal is to do a day per day, which works out to 365 per year.
Mark did 200 in 2020 and is looking to increase that.
How much does the average raw land deal bring you?
The average deal brings about $200/month.
You want to go to the county assessor to get the real property list and start your mailing from there.
What is your software?
Mark has actually created the software that they use! It is called LG Pass.
It is one of the best real estate land software’s out there.
The software will send out the offer, it can be dripped and has address verification.
How much time do you invest in raw land investing?
90% of the business is automated with software and virtual assistants. Mark currently works in the business about 2 hours per week.
Kaizen: Continuous improvement.
Can you do raw land investing in other countries other than the USA?
You can do it from anywhere in the world. Mark recommends that even if you live in another country, you should buy USA property.
Mark has many students in Britain, Canada, and Australia that are buying US properties.
This sounds so easy, what could go wrong with raw land investing?
Mark has done this over 6000 times and he has never lost money on a deal. There is a pig for every barn.
If you follow the process and get your numbers right, there really is no way you can lose money. Remember, the money is made on the buy, not the selling of the land.
You now have the property, how long does it take to close a raw land transaction?
Mark uses a software cost Simplifile, the seller will sign and notarize the deed, which can be done in minutes since it is done digitally, and then Mark sends them a check.
What are some softwares you use?
What3Words? This will take any GPS Coordinates and turn it into 3 words.
What are some of the mistakes or things people should avoid when getting into raw land investing?
You will lose money if there is no money in the deal. Don’t get emotional and overpay.
You don’t want the property to have high back taxes, which you will find during your due diligence.
You don’t want to buy property in a superfund site. For that reason, Mark avoids places where there is high manufacturing and industrial such as New Jersey, Ohio, Pennsylvania and others.
Mark tries to stick to the South West!
Where are you going to find comparable sales on land sales?
You can go to the County Assessor or Land Motto and do a reverse engineer calculation there.
What is the typical size of land you are buying?
The size of the land does not matter for Mark, as long as he can get it for a great price. He will buy anything as small as a postage stamp up to a 640 acre section.
Tell us about your students!
These are people who are looking for freedom. Mark loves buying and selling raw land, but no one who has bought land from him has ever said, “Hey Mark, you’ve changed my life”.
Mark shares a live VOX from Sid, one of his students.
Why don’t you hear about this business model on main stream news?
It is the most boring niche on the market!
The before picture is raw land, the after picture is raw land! It is a pretty geeky niche where people are behind computers all day trying to find deals.
For the average person, can you get started without a team?
Absolutely, this is how Mark did it. Mark does not recommend it, if you can start with a tribe, it will make your journey easier and more helpful, but it can definitely be done solo.
What would your first hire be in raw land investing?
The first thing you should outsource is what you hate the most. Whatever takes the most out of and makes you not want to work, should be outsourced first.
Mark is offering a $97 course FREE for Hobby Hustlers!
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