You’ve decided to get into real estate because you’ve heard about the potential cash flow streams, but you think to yourself “I am not a sales person…I don’t think I am cut out for this!”.
This is one of the biggest misconceptions, especially with Land Investing that we see. Through our community, we have seen many students come to us fearful that they don’t have enough sales experience to make land deals happen.
We want to re-write this narrative. Anyone can flip land!
All you need is 20% of your day, a phone and and internet connection.
With that being said, we have found 5 tips that have proven successful in our business, as well as many of our students land flipping businesses as well.
Focusing on the efficient negotiation practices in this article will lead to a high volume of successful deals.
After sending mailers & follow-up texts, expect A LOT of calls.
These leads are going to naturally be skeptical about the offer they received from you. One of the best things you can do is be honest with them.
Let’s say you originally offered the seller $55k, but during the due diligence process, you missed a portion of their land being in a flood-zone, and now need to negotiate the price down to $32,000.
“Hello. When I originally made an offer on your property for $55,000, I did not realize that 3/4 of your property is wetlands or in a flood-zone and I cannot buy it for this price.
We do have cash ready for this purchase, but the most I can offer is $32,000.
I understand if you aren’t interested in moving forward, but this is what I can offer and we could close in 2-3 weeks.”
Usually these sellers know what is wrong with their property, and will actually appreciate your honesty and transparency, and more often than not, they come back to us and end up accepting the new offer.
Nurture relationships and build confidence with sellers during the purchase agreement stage.
Practice Active Listening. Consider the seller’s concerns and objectives throughout the lifecycle of the deal. Leverage knowledge about the sellers’ motivations, and reinforce the speed of transaction as a positive factor; it will show the seller that you are confident in your offer.
Maintaining integrity while creating a mutually beneficial transaction for both you and the seller is the goal at the end of the day.
Let’s assume you’ve done proper due diligence on this sellers’ property, and you’ve learned that part of the land has a large slope. Use this information when negotiating.
Hone in on the knowledge you have on the surrounding area as well as the property features (or lack there of) to your benefit.
Knowing what comparable land is selling for, and being up-front with the seller will show that you are credible, as well as confident which is going to take you far.
Practicing Active Listening, utilizing the knowledge you’ve gained from not only conversations with the seller, but market research and comparable data, you are ready to paint a clear picture.
The seller may need that money for a medical procedure, or maybe the property was inherited after the passing of a relative. If they are are elderly, they may be unable to tend to the property.
Paint a picture of WHY selling this property for cash is the best option for the seller based on their situation.
Be realistic with your initial offer and make it reasonable to prove to the seller that you’re serious.
Make sure you have room to move your number around so that the seller can feel confident in the number they give you as a counter. They should ultimately feel like they are getting a great offer in the end.
Remain patient throughout the deal; you don’t want to push the seller too much or they may pull away entirely.
Let the seller know that they can reach out to you when needed, and give a friendly follow-up if you haven’t heard back.
Ron: Welcome to the real estate investing podcast, where we help you unlock your potential freedom through land investing, real estate investing, and entrepreneurship. Hey everyone. Welcome back to the real estate investing podcast. I’m your host, Ron Apke. In today’s episode, we are going to discuss the top three mistakes new land investors make.
And I wanted to bring this topic up. I think this is such an important topic because so many people are coming from wholesaling, house flipping. We have people in our program coming as from teaching or whatever the situation is, so many people are coming into this business and we are constantly seeing the same two, three, four, five mistakes over and over that could keep them from maybe making a million dollars next year in this business, whatever the situation is, but I wanted to cover this as an extremely important topic.
And it’s something that we have taken data on. Like we track our students very diligently and we see the things that are keeping them from taking their business from that six figure business to that seven figure business. But let’s get started on the show guys. We’re going to get right into it here.
Number one on this list is indecisiveness. And when I say indecisiveness, this is very broad. It’s not just like they’re indecisive with one part of their business. It’s just an indecisive decision making within their business. And as land investors, like our big decisions that we have are market selection.
So where are we going to invest? What market are we going to choose? Are we going to go to Georgia? Are we going to go to South Carolina? Are we going to go to Minnesota, Michigan and evaluating these markets? And then making a decision. And I see people taking two, three, four weeks sometimes, and this kills their deal flow.
The name of our business, the name of land flipping, the name of land investing is flipping your money quickly and keeping deal flow to do this. You need to be able to make decisions fast. And it is going to take time. If you’re just getting started, those decisions are going to take longer the first few months, the first six months, the first year, maybe, but you should be cutting down on those decision making processes where maybe the first time you pick a market, it takes two weeks.
The second time, maybe it takes 10 days, a year down the line, guys, legitimately choosing a market should take 20 minutes. You should pull some numbers. You should know what’s going on. You should understand it by looking at Zillow, looking at Redfin. Looking at just the data sources that we talk about so much and choose a market.
Like that is what every part of your business should be. Another key part of the indecisiveness, and this is not so much indecisiveness, honestly, guys, but it’s like indecision, like making the decision of moving forward with a deal or not moving forward with a deal. So many people I see. Have that seller that could potentially turn into a solid deal and they just never really push the seller forward to make a decision or they never make a decision, whatever it is.
And they have 5, 10, 15 of these deals that are just in this weird. Limbo phase. And they’re not really moving forward. They’re not being stopped at some point. Maybe it’s a negotiation thing. Like you’re struggling with the negotiation and sellers telling you one number, you’re saying a different number and you’re not like drawing the line in the sand and saying like, listen, I can pay 20, 000.
If you can’t do that, let me know by Friday. If you cannot do that, I understand. I completely understand. Um, I hope you can find another buyer for this land. But I cannot do it and being able to throw away deals, being able to make final decisions on deals. If a seller doesn’t meet you, if a buyer doesn’t meet you where you want to be, will cut out so much time.
And it’s something that keeps people from doing five deals a month. And they’re doing one deal because one deal is taking up so much of their time. But also guys, it’s just, it’s, it’s, it’s something, it’s an experience thing. So if you’re not getting that experience upfront, it’s going to take longer. If you’re not doing more deals, sending more mail, it’s going to take longer.
It’s going to be a process. I completely understand that it’s the unnecessary time that I see. That you need to cut out as your business is growing to scale from that 200, 300, 000 business to the million dollar business. Cause the reality of land, investing land, flipping, you can do this by yourself and make seven figures a year.
I, we have so many people doing it. I have no doubt in anyone being able to do it intellectually. Like anyone can do this. You don’t have to be a genius to do this. It’s just cutting out the little BS that can make you a more efficient business. So that’s number one indecision as a whole, really think about this.
Like if you are in that position where you think you could be more decisive as a land investor, evaluate yourself. Like when we’re talking about the, all three of these things, like, do you fall into this category? Everyone can improve. I can improve in my decision making. Everyone can improve, but it’s about making the right decisions or making the decisions and then just dealing with the consequences, whether they’re right, whether they’re wrong.
But moving the decision forward is something that is going to help your business grow. You’re going to make wrong decisions at times. It’s going to happen, but making the decisions is going to help your business in the long run. Number two, this is a little bigger picture one, I think, but what I have here is undervaluing.
Investor relations. A lot of people come in with, I don’t know, 20, 30, 000. They use five, 10, 000 on marketing. They get a deal, they buy it for 10, they sell it for 20, whatever the situation is. Maybe they had a funding partner for their second deal, buy for 20, sell for 40. They didn’t do a great, they didn’t communicate well with the investor.
That investor is a little hesitant to come back with them all of a sudden guys, you maybe not the first three months, maybe not the first six months, but there’s going to eventually be a deal that you get that comes in. That’s 300, 000 and it’s worth 600, 000. If you didn’t take care of your investors, that 300, 000 deal is going to be a lot more difficult to finance.
Then if you took care of them, will you still get funding? Maybe, maybe not. I don’t know. It matters how much, how that relationship was, or if you can find other people to fund, but the valuing of investors and taking care of your investors, your funding partners is probably the biggest mistake I see. I know all three of these mistakes.
These are all mistakes that I’m seeing, but the longevity. Of this business is going to be surrounded about the money you can collect. What if you need $2 million for a deal that’s worth $4 million? If you can’t fund that, you’re gonna lose that deal. Someone else is gonna eat it up and be able to buy it.
If you have those investor relations, you, you need to have investor relations for the future as well, is what I’m trying to get at. Like you cannot, if your deal size is $50,000 right now, $20,000. And maybe you can fund a lot of those yourselves. There’s gonna be a deal that you cannot fund yourself. So having those people ready, communicating with them when you do give them deals, taking care of them when they do, when you do give them deals.
Now, when that big deal comes, they’re going to be excited. They’re going to be pumped because they’re going to make money alongside with you, where if you didn’t take care of them, like no, one’s gotten, no, one’s going to make money because they’re not going to invest in your deal. And you can imagine that guy’s like buy for 2 million, sell for 4 million.
You can fund that a hundred percent with investors and make a million dollars. Those deals are out there. I’m like those deals, whether it’s a little bit of project base, or you have to subdivide a little bit. Those deals are out there and that’s a million dollars profit. You are leaving on the table If you don’t have investors for deals like that, if you don’t take care of your investors, who could be the ones funding that, uh, at some point.
So that is number two. It is something that it’s just so, so important in growing. It’s banking relationships. Like if you’re a big, uh, apartment guy and you’re buying hundreds, thousands of units, you need banks on your side. This is the same thing. Just the funding, the funding partners are a little different.
It’s not big banks that are funding. It’s small individuals, maybe with three, 2 million liquid, whatever the situation is. So having those relationships, building those relationships is going to build your business. Like it is going to grow your business. And it’s something we still get funding for our deals.
We don’t fund all of our deals. We could fund most of our deals, but we like to spread our money out. And partners deals in just a lot of different spots. So we like, we know how important it is. When you don’t take care of your investors because they will drop off. Like it is the reality. They will drop off if you’re not, if you are not taking care of them.
And when I’m saying taking care of them, it’s not only getting them a great return, the communication, like we’ve put whole processes and how we communicate with our investors. We have our COO who is highly communicative. With our investors, like that is one of his big, big roles in our business, because how much we value our investors, how much we value the money they are bringing us and the potential of that money.
But that is number two guys. And finally, number three. Stopping educating yourselves once you do a few deals. So that is the person who is six months in, nine months in, 12 months in, they’ve done a deal a month for the last eight months. They’re happy. They made 300, 000. on those eight deals, which is amazing.
Like you guys should be, if you don’t want to do any more money, if you don’t want to make any more money on that, great. Keep doing what you’re doing. But the people who are talking about doing 2 million a year by themselves, maybe with one employee, whatever the situation is, and they just stop educating themselves.
They stop being a part of the community. They stop watching YouTube videos. They stop learning about different things that can grow their business. Not everything. We not everything in land investing that you can make money on is in our course. So continuing to educate yourselves. And there’s a lot of these things in these small calls that we have, where there’s so much stuff you can learn when we talk about subdividing.
And the potential in that and just the education aspect behind that land investing is not going to be the same every year. So if you stop educating yourself, you might three years from now, you’re going to be doing a strategy from 2023. And that’s gonna, maybe it doesn’t work. Maybe it works. I don’t know, but strategies are going to change for getting deals.
Um, there’s going to be different efficiencies with this business. And if you do not continue to educate, educate yourself, network with other people, talk to other people about what’s working in their business. Uh, you’re going to fall behind. It doesn’t mean you’re going to fall flat on your face. But you will fall behind.
Like there’s no question about it. If you stop educating yourself in this business, it’s going to be, and that’s any business, it has nothing to do with land investing. Like if you’re a, my, my dad’s a carpet cleaner, he’s been a carpet, he’s owned a carpet cleaning business for almost 40 years. He is constantly going to these conferences every year.
He goes to conferences, learns new techniques. He does water restoration and carpet cleaning. He’s learning new techniques for carpet cleaning, learning new water restoration techniques, just learning, learning, learning, learning. And that is helping. That’s helping bring the best thing for him to his customers.
And that is why he’s growing year after year. And that’s the same thing, guys, continuing to educate is something that I think can be overlooked. And once you sniff, once you smell a little bit of success, it’s easy. Like I’ve done it before in other things. It’s easy to stop educating as an educator myself in this business.
Like I’m still trying to learn. I read books. I, I listened to lawyers talk about land stuff. I listened to accountants talk about land stuff. I try to learn right now. A big thing for me, education wise is learning about mineral rights, surface versus mineral rights. What can be done? Like is the potential with mineral rights?
We’re not in a ton of markets where a mineral rights being separated from a surface race is a very big thing. But we do fund a lot of deals in those areas. We partner with a lot of people in those areas. So when those issues come up, I want to be as educated as possible to make a decision. Like we talked about number one, decision making like if I’m more educated, I can be a lot more decisive with these things.
But if I don’t know what the heck mineral rights in Oklahoma, or if I don’t have mineral rights in Oklahoma, how’s that going to affect my deal? I don’t know that it’s going to be a lot more difficult for me to make a decision, but to summarize guys, these three things, number one, indecisiveness, being indecisive, market selection, moving forward with deals, every aspect of your business.
Number two, undervaluing investor relations. I, I think for me, this is the biggest thing they’re, they’re all big, but I think for me, this is the biggest thing to getting you to the next level from taking your business to half a million, 10 million. It’s having those investor that those banking type of relations and valuing those highly, like really, really valuing those.
And then number three, education, continuing to educate, continuing to grow yourself. One of our core values at our company is growth. We fully believe in it. People are hired and fired at our company for that core value and in all of our core values. But that is how we, how strongly we feel about that core value growth.
Um, if you don’t have a growth mindset, you’re going to struggle within anything to really take it to the next level. Other than that, guys, like I said, these are the three biggest mistakes I’m seeing from people in our community, from new land investors, everything like that. Land investors who are, have been in the business 12 months, who are trying to scale up and they’re struggling to do that.
Just the three biggest mistakes that I see overall. So other than that, guys, if you guys have not already, you’re watching the YouTube video, please hit that subscribe button down, down below. It really, really helps us grow our mission, grow our voice within a YouTube, the algorithm and everything like that.
Other than that, guys, have a really good day. See you next time. Thanks. As always, thank you for joining. Please do us a huge favor and like, and subscribe our YouTube channel and share this with a friend. It really means the world to Ron and I, but more importantly, it could help change the life of someone else.
Thanks for joining and we’ll see you next episode.