Land Investing 101 - Land Investing For Beginners And What Makes It Passive Income

Land investing is a simple, low-risk way to build passive income while avoiding the headaches of traditional real estate investing models. Discover how this overlooked and undervalued passive income opportunity works with Land Investing 101.
00:00 Introduction
01:05 Buying Land For Pennies On The Dollar
03:02 Due Diligence
03:50 Sell Property and Create Cash Flow
06:37 Example Deals
08:23 Next Steps
Learn more at www.thelandgeek.com/
I’m Mark Podolsky AKA “The Land Geek” and I’ve been a professional land investor for 20 years and owner of Frontier Properties. Since 2001, I have completed over 5,500 land deals with an average ROI of over 300% on cash flips, and over 1,000% on the deals with financing terms.
Now, I teach others how to invest in raw land. I have helped thousands of people to replace their income, retire their spouses and focus on what really matters.
What is land Investing?
Before we dive into how the model works in detail, let me give you a simple overview of what land investing is.
Land investing is where we buy raw land for $.25 on the dollar, then we turn around and sell it at retail price.
Essentially, we’re land flipping.
So where does passive income come into play?
Rather than doing a straight land flip, we offer owner financing to make the dream of land ownership easy and affordable.
We see a typical ROI of over 300% to 1000% per deal.
So now let’s break the model down step by step.
How To Buy Land For Pennies On The Dollar
We buy land for $.25 on a dollar from those who are no longer emotionally attached to the property and are eager to sell.
Common reasons people are willing to sell their land are…
They’ve moved and can no longer access the property as frequently as they once did.
They inherited the property from a family member, they have no emotional attachment to it, and they don’t want to pay the taxes on it.
Their priorities have changed and they no longer have the time to use the land as they previously did.
So the first thing we do is determine what area we want to work in and then find someone who owes back taxes on a property.
Let’s say, for example, we find Eric who has a 10-acre parcel of land in Texas and he owes $200 in back taxes.
Now we take a look at comparable sales in the area.
We will take the lowest comparable sale and divide it by four so we have a comfortable margin of safety. This will be our offer price to buy the property.
So in Eric’s case, let’s say the lowest comparable sale is $10,000. Divide that by four and we get $2,500.
Then we send an offer letter to Eric saying we’d like to buy the land for $2500 and take care of the back taxes on the property.
And he accepts!
Generally, we see a 3-5% acceptance rate on our offer.
The offer is also contingent on passing due diligence, which we’ll cover next.
Due Diligence
Due Diligence is one of the most important steps of this model. Do your due diligence correctly and you’ll never be stuck with a “bad” deal.
We just want to make sure that we are receiving full disclosure of the facts and conditions of the property prior to buying the property.
We’ll check to make sure…
They actually own the property
There are no liens on the property
There are no breaks in the chain of title
We are aware of all back taxes on the property
Confirm if there are any roads leading to the property
What amenities and services are near the property
If there are any restrictions on the property.
Everything under due diligence can easily be passed off to a virtual assistant so you do not have to do any heavy lifting.
Sell Property And Create Cash Flow
One of the most frequent questions I get asked is who is going to buy the property?
The first place to look for a buyer is by going to the neighbors.
Oftentimes, the neighbors will be interested in buying that property. This might be for more privacy, unobstructed views, or simply to have as a short-term or long-term investment.
If they pass on your offer, the next thing to do is to resort to your buyers’ list.
A buyers’ list is a list containing the contact information of people who have expressed interest in our properties.
If your buyers’ list passes on your offer, the next step is to market on the following websites.
Craigslist
Facebook
Zillow
Landmodo
Landflip
And more!
How You Can Get To Total Freedom
Once you have created enough land notes, where your passive income exceeds your fixed expenses, you’ll only be working because you want to and not because you have to.
For all the additional information you’ll need on the best passive income model, get our FREE Wholetailing course: www.thelandgeek.com/wholetailing
Get our FREE Passive Income Launch Kit. I will share with you some of the secret Land Investment Strategies you probably have never heard of: www.thelandgeek.com/launchkit

[@arigutman]

Great video for the beginners out there. Honestly, the most important aspect when it comes to investing is one's mindset. Today, there are far too many get rich by Tuesday types out there, many of which are day trading. If it works for them, kudos, but for far too many, they are losing money. Therefore, keep it simple in index investing to start then move to "riskier" investments by way of finding HIGH quality companies to invest in for the long-run given their growth both in terms of share price and dividend payments. Hint: AAPL, JNJ, O etc etc

[@cm8731]

Wish these videos were in a podcast form. Thanks for sharing!

[@NeilHaugerLandSpecialist]

I hope this is not considered hijacking but I have a podcast called The American Land Man on Apple and Spotify. We talk about buying managing and selling American land. I have a KZbin channel by the same.

[@catchnote2]

Wow you have made another great video. Tks again

[@bishalhandique766]

Good to c you man.....😀

[@DAMON409]

Great concise breakdown. How do you guarantee the buyer will pay you every month?

[@savvaneri]

Great video, great information!

[@budramkissoon7938]

Thanks Mark

[@ritasjourney]

Very interesting

[@yoseoperdomo9766]

great video caught some what of an idea of what going on but is there a video that does in depth how to analyze a land deal ?

[@mman1222]

Hey Mark great video, I also finance real-estate. Im trying to dial in my true anual ROI. On the example you gave(20,096÷2500=8.37) don't you still have to divide that by the 7yrs to get an annual return? Giving a 119% ? Thanks for the help

[@veev327]

Is there a way to buy 6 figure land deal and get financing? These deals in video are too small

[@fivestarconstructionllc7430]

I just read your book.

[@davidhodge2229]

Where and how to find these auctions?

[@embitious630]

I’m Filipina working here in cali. I’m debt free and buying lands in my home country. Is it a good idea? I wanna buy some here too. I don’t know how

[@goranbezjak9830]

Very good information. Thank you. I would like to know if there is a right of pre-emption in the United States of America, such as "farmer status". I am from Slovenia, EU. I buy land often and I'm also a farmer. In our country, when buying agricultural land, regardless of the set price, priority is given to neighboring farmers, farmers and so on. When buying forests, priority is given to the one who owns the forest closer to it. Even among farmers, there are different pre-emptive rights. It is also intended to combine land into larger areas. If the farmer does not compete for the agricultural land or forest, the seller can sell the land to anyone. The price of land in our country is increasing. In recent years, by approximately 100%. The current price of agricultural land varies between 2 - 5 euros m2.

[@autumnneube7791]

Who keeps up with the taxes every year? You or the new borrower?

[@PedroGomez-sz8rs]

Ppl laugh about I bought land