123: Land Investing: Navigating Land Deals, Lead Generation, and Legalities $2,500 Second Land Deal

This episode reveals the intricate lessons learned from my recent land deal in Iredell County, North Carolina, illustrating the importance of negotiation, patience, and thorough due diligence. Listeners gain insights into lead generation strategies, the complexities of double closings, and the critical nature of understanding all associated costs. 

• Reflecting on previous land deal experiences.
• Importance of effective lead generation strategies.
• Risks associated with cold calling and ringless voicemails. 
• The significant impact of property accessibility on negotiation.
• Challenges faced during the double closing process.
• Financial implications of closing costs and taxes.
• Self-reflection on negotiation tactics and emotional involvement.
• Future insights on navigating real estate investing lessons.

This podcast is sponsored by Starvelle Talent Group. Our goal is to help the culture build Wealth Assets Prosperity. We appreciate you taking the time to listen to this episode and share the content if you find value.

Transcript

Speaker 1: 0:01

Welcome to the Think Generation of Wealth podcast, and this is episode number 123. I am your host, amir Estimo. Thank you for tuning in in today's podcast episode because you could be doing anything in this world, but the fact that you are listening to this podcast episode it is much appreciated. Are listening to this podcast episode, it is much appreciated. Second of all, if you get a chance, please rate and subscribe to the podcast. The podcast drops. If you're a new listener, the podcast drops every Wednesday 6 am Central Standard Time. You will get new content from Amir Estimo and Thing Generation as well.

Speaker 1: 0:56

Okay, so let's dive in in today's podcast episode. So today's podcast episode is a continuation of the previous podcast episode where I talked about a land deal that I went through. That I went through that I executed. That took me about a year and a half, but I ended up making $10,000 on this deal. Now the second deal that I had, the second deal that I executed on that I closed on, deal that I executed on that I closed on, is this deal was actually in Iredell, north Carolina, the County of Iredell, north Carolina, and this deal came through again through a mailer. So the previous deal, when you are in land when you were in real estate investing.

Speaker 1: 1:42

There is multiple ways you can find leads. Some is you can send mailers, you can do cold calling, you can do texting, you can do ringless voicemail. Now, the issue with each now I'm just going to touch on this a little bit With ringless voicemail you want to be careful with that because if whoever, especially if you reach out to someone, that is a do not disturb, let's say or not do not disturb, or do not contact, or do not call, and let's say, for example, you reach out to them, or you bought a list and you didn't scrub your list and properly, and you do a ringless voicemail. And for you who got, who don't know what a ringless voicemail is, is a ringless voicemail is when you actually you call a number but you don't actually talk to the person. So once the person cause, there's a prerecorded message that you walked in through and then or that message can usually get dropped directly to their voicemail. The issue with that again is if they don't give you the, let's say they don't give you, they don't say, ok, hey, you can call me and whatnot, and they don't give you the consent to call them, these people can actually come back and sue you and ring this voicemail is becoming a strategy that is actually now being heavily scrutinized, because a lot of companies don't want they are getting away they doing these ringless voicemails, especially now a lot of people thinking it's scam, so you want to be careful with that. Then, of course, there's texting. You can do that too. Same thing they don't give you the consent to reach out to them. They can come back and sue you. Same thing with cold calling. Cold calling and then mailing. Mailing is the same thing is if someone is on a do not contact list and you actually contact them with a letter, you can actually get sued and get in trouble.

Speaker 1: 3:48

So, but the most, probably the safest but it's actually kind of expensive too is what they call PPC, which is pay-per-click. Pay-per-click meaning that you have a website someone actually may have. They want to sell their property, and if they go online themselves and say, hey, they submit their information and they want to sell their property, that's probably the most safest way to do it, because they are contacting you. You are not reaching out to them, so that's probably. But the issue with that is if you, you are not reaching out to them, so that's probably what the issue with that is. If you let's say someone or it could be a competitor and that competitor doesn't, they know that. Hey, you're a comparativist because for every time someone clicks your link, you actually there's a, a cent that's getting charged to you. There's an amount that's getting charged. So if they sit there and click it, let's say they click, click, click, click, click and they never even submit anything, you usually you have to fight with, let's say, it could be Google Cause. Let's say you do a Google pay-per-click and you have to fight with them to say, hey, this is not legitimate, this is just someone who's just playing around, whatnot. But it can get quite expensive, especially if you're not turning any leads into conversions. You're not converting these leads.

Speaker 1: 5:14

Now, this deal did come from a mailer and it was in irendale, north carolina. The interesting thing about this deal was one the deal didn't really have. The deal Didn't? The property did not really have a great access. So if you had actually look at the property itself where it was located, the property looked like it was located in a dead end area. It didn't have a paved road. It was actually a dirt road and it was not. It was not even there was no road, there was no world that was actually built to this property and, on top of that, the property it was.

Speaker 1: 5:58

It was a nice property itself. It was uh, but the the thing was is that it didn't have a really didn't have what they call this maintained access or a state road. Maintain access meaning that the state is the one who's responsible. Now, if it's private road access, that means whoever it could be, whoever in that area is responsible for maintaining and keeping the road you know in shape. But if you if you're so let's say, you ever buy a property and it's not state maintained, let's say it's private, more likely, most of time it's gonna, it's not gonna be in the best condition. So that was the one thing about the part. But it was a nice property it had. It was one acre. There were some houses in that area. There was also electricity in the area too. The good thing about this property, though it was, it was didn't have any. It was not wetlands, so that was one. It was flat, it was not slope, so that means this property probably was probably better for someone who wants to build a residential home in that area. The only thing they would need to do was, of course, they would have to. They would have to cut down the trees and then they would have to get the property. They would have to get the property. You have to get the property tested, soil tested, to see if it can have a, if you can install a septic tank or you can install a well in this area, which is what the person who bought it from me actually did. Now, this deal, I end up double closing the. I'm going to tell you the pros and the cons. Let's start with the cons this second deal. What I did wrong in this second deal was I bought this property. First of all, you have to learn when it comes to real estate or probably anything in general, you have to learn how to negotiate. I did not negotiate this property. First of all, when I sent the mailer, the original offer was like $11,000 or something to that nature. As I did my due diligence, I talked to the seller. Now, the seller was a young lady, her father. Basically, in a nutshell, her father was not responsible with money, and then the mom passed away and then the father again was just not responsible with money. So they just need the money to just be able to take care of some type of debt, and I got, first of all it was $11,500. $11,500. Then I actually negotiated down the property to, I think, about $6,000 or so. Okay, like about $6,000. I got it down. In contrast, though, I should have probably got this property down to more of the range of three to $4,000, but I got it to about six. Okay, so that's number one. So you look at that spread, you're looking at a $5,500 spread from the get-go and you're still not even thinking about the taxes and the other maybe improvements you do on the property. If that's what I had desired. Now the the thing was, was that okay? So I got it down to about 6,000. So the spread was about 50. So I got it down to about 5,500 from the original price. But I double close. Meaning, when you double close, meaning you do what they call an A to B, b to C. A to B means you close with the seller and then you turn around and sell that property to an end buyer who is the C, and you can do this online, this all in one day. But with double close, you some title company they may, they may say, ok, hey, you know, you can use our funding to close on this deal. Some may not A majority is probably going to say no but if you do that, in case you may use, you may look at options like a private lender or a also a transactional, transactional lender type. So maybe when you use those two, you basically would a private lender, depending how comfortable level in that private lender could be anybody. It could be a friend, it could be someone, because there's a lot of people in the real estate industry that has money that they can, they would like to deploy. But if you go that route, they're gonna charge you a fee. But for me, I had the money, so I closed on this deal on my own. I self not self-closed, but I used the attorney because North Carolina is an attorney state. Now, some states are attorney and attorney state, so you actually have to close with an attorney, and some states are attorney and attorney state, so you actually have to close with an attorney, and some states are not, like Florida is example. Um, it was a state that I closed the deal on that was not. You can close through a title company and that's okay. Now this deal once I closed with the seller, I paid the taxes to the seller. So as an investor, you want to make sure, because when you sell them a letter, you want to say, okay, it depends however you negotiate this. Some sellers may say, okay, you know, I'll pay the taxes. Some, but probably 95% of these sellers are not going to say that they're going to expect you to pay all the taxes and all the closing costs and which came about, I think, about fifteen hundred dollars or so. Now that's OK, which is fine. But when I close with the end buyer, I think that property I end up, they end up buying it from me for $12,000. So that's the case. You know you have 600, I mean 6,000, and then you put 1,500, that's already 7,500. So you only have a 4,500 spread. What I did not do correctly was I then paid whatever the closing costs on my end too, which is that was not correct. The end buyer should have closed, had paid all the closing costs, but this deal actually took me three months to sell for close to three to four months, and the only reason it took longer? Because the seller was basically a dinosaur. They didn't really have um I, they only had an email, but it was very hard like to do the notarization and you actually have to get them. They had to go and do the notarization. They did not want to do an online notary. There came a point in the deal when we were getting ready because the end buyer was ready. The end buyer went, got the property soil tested. They already had a plan ready to build on the property. But the seller kind of ghosted me for a little bit and I started getting worried. I said, oh my gosh, because if the seller doesn't close with you, you can't sell it to the end buyer right away because that title, that deed, is not under your name still. So I got ghosted for about a week or two and the end buyer already deposited the funds to the attorney. Because the end buyer, whenever I do these deals, I use my title or attorney. I don't use nobody. The only time I probably use somebody else's title or attorney is if I already bought the property and I already owned a property myself. But in this case, since I was double closing, hey, these are my terms either you do it or not, period. So therefore the end buyer, the seller, kind of ghosted me and then the dad was kind of acting up a little bit. So it was just so much work that was into it, meaning trying to get everything lined up because the end buyer deposited the funds. They were ready, they're ready to get this deal up and going. But the seller kind of ghosted me for a little bit and I kind of got worried. So after a week later I was able to get in contact with the seller. I came to find out the daughter or something had something going off the phone. Their phone was broke. It was just always something with these people, it was just always something. So then I end up doing the closing and I kind of paid the same closing cost that I paid on the seller side. It's about I basically paid thirty30,000 and you still got to take into account, did you, if you sent out marketing, how much time you're putting into this property, meaning marketing the property. Also, did you get drone pictures of it? Because most of the time you want to be able to sell this property and be able to people have a visualization of it. So that was about 3000. So I was all in nine thousand dollars and the taxes. After everything came about, I ended up making like uh 2500 or something. Uh 2500 on this deal, which number one my mistake was I did not properly negotiate number one. Number two if I had negotiated down the property a little bit more, they I probably could have made six thousand dollars if I got it down to about forty five, because me and the daughter were going back and forth when it started at eleven five. So, hey, listen, you don't really have a good access, um, and on top of that it's not clear. And therefore here this was. I went with at first I offered them like 5,000 and then going back and forth, so the property ended up I ended up agreeing to 6,000. And when I look after I closed on the deal and I looked at it, cause every time I close these deals I I do a self-reflection and I said, okay, you know what, what did I do right? What did I do wrong? And I already saw, if I hadn't negotiated down more, because I kind of got, I want to say I was hungry to close the deal, but if I had just showed maybe a little bit more patience and actually really negotiated, I could have gotten a deal, maybe even three to $4,000. But because I kind of I was like, hey, you know, they kind of need the money, I was like you know what, let's just do this Okay. But you always have to understand when you do these deals you cannot have the feelings into it. So that was another thing I did wrong. But the good thing with the property it didn't last that long. I actually sold it at three to four months. So that was a lesson learned for this property. So, number one if you ever everything is negotiable in life, you you can negotiate. You can negotiate every anything in life. It's just a matter of knowing how to do it. So I did not do, I did not negotiate very well. So I would say that was one and then two. I didn't understand. I'm like, wait a minute, I actually own this property. I should have had the buyer pay all the taxes, but because the deal was it was, it should have been closed in three months. It took four, close to four months. I just wanted to sell the property. But again, patience, patience is a virtue. So that was my mistake of this property, that I didn't. I should have just been a little bit more patient and took my time and then also just again negotiate, negotiate, negotiate, that was. And then you got to think about for every hours you put into a deal and whatever you make on that end, you can make you your, you can close on a deal, and I'm going to share my next deal. This one here was I would say it was a complete nightmare because it had so many title issues, but this one is just. This will be another story for another podcast, and I think this will be the next one. And then I'll probably give you guys a break. And then, because I have a few more deals that I'd like to share with you guys, and only the reason I'm sharing these with you guys is to tell you that anything is possible. You can do anything. It just you have to have the right mindset and the right skill. And if you don't have either, then it's not going to work. And for me, when I got into the Savannah business and I looked at it at first, I was, like you know, I always wanted to do real estate. But, however, you have to know what you're doing and sometimes you may need a higher mentor, which I hired a mentor, and this person was great and all had a great program. Uh, and I learned a lot from it. Now I, when I reflected back on the deal now, I saw, okay, this is what I shouldn't have not done. I got too eager, I wasn't patient and therefore I didn't make as much money. So if you make let's say you can make a hundred thousand dollars on the deal. But if you put close to a hundred hours into, you have to take an account how many hours mean talking to buyers and sellers, marketing, and in how many hours and what was your profit to make that money. Because some deals the deal I did last week I talked about last week on episode 122. Check it out and I will actually link or share some of the old podcasts that you guys can refer to. But this deal was, this was it was it took. It didn't take as long to sell, but the thing was the profit wasn't there. So that was a lesson learned from me and the next two deals that I end up having, I end up actually making more money, but one of these deals again took more time. So I hope this podcast, this episode, was of value to you and again, you can do anything. If you want to start a podcast, go and start a podcast. If you want to start a business, go and start a business, because at the end of the day, you want to leave a legacy. You want to leave a legacy, and the reason I'm sharing these deals with you because to let you know, too, the really good side and the dark side of real estate investing or lending flipping. It's not as kicked up as these, as people you may see online. You see someone say, oh man, I made a hundred thousand dollars, but they don't tell you how long it took, what do they have to do, and they don't explain it to you. So everything you're seeing is at surface level, but you're not seeing all the hard work it took to make that money. And that is why I'm sharing. I'm sharing these with you. I'm not going to come on here and tell you and tell you hey, you know, I made a hundred thousand dollars. Well, no, I made a hundred. Let's say I did. But then you got to share your losses too. You got to share not only just your wins, share your losses because people can relate to that. So if any of you guys ever decide so, to want to get into real estate investing, you have now an understanding that you know what Amir shared these pitfalls, and then whatever I've shared with you, you can now not replicate and do that same mistake. Ok, thank you for tuning into the podcast. If you enjoy the content, please rate and subscribe this podcast. I'd be much appreciative. Until next week, I will share deal number three and I think we'll take a break from there and then after that we'll get back to our regularly scheduled program. Much love, peace, thank you. Thank you.