Posted on: February 18, 2022
WI 889 | Selling Land

 

Being of service in the military gives an individual a certain discipline and calling regardless of what position they’re in. It entails a great deal of responsibility. Not only that, but it also trains a person to be able to handle setbacks and work efficiently in the midst of challenges. We can witness that ability from this multifaceted perspective of selling big time while maintaining a constant cash flow.

Daniel Watson tells his experience of immersing himself in two distinct careers. After hitting the one-year mark on selling his first property, Daniel has already subdued the initially difficult learning curves. As noble as army work has been, he attests that this secondary income has generated more than what he makes in the military. Join us as Daniel gives us an outlook on the results that one will get from the work that one makes sure to put in.

Selling a Million Dollars in Land in 7 Months while Generating $100k Net Profit Per Month

I have a very amazing guest. You might recognize his name because I have already got the opportunity to do an episode with him. This guy is blowing my mind with all the updates he has been giving me and the constant back and forth. He was a good friend of mine. I got to serve in the military with him. I met him out at Fort Carson, Colorado. He took the spot of one of my jobs. He took over from me. He probably had a lot of things to fix after I took off out of there. We have created a great friendship. I keep in touch with him and all the land deals he is doing. I got you right here, Daniel Watson. How are you doing?

I’m doing good. Thanks for having me on. I appreciate it.

This is a good time. We are sitting here drinking some coffee together. Daniel is showing me all of his closing packets. Where have you been? What is going on? Give me the last couple of months of your life. You got some great news coming as well.

It has been pretty crazy. A lot of things have happened personally, as well as in both of my careers. I took command in an ABCT in Texas. I’m at Fort Hood. I’m a commander of a company. My wife is pregnant with our third baby. We are having our third baby boy. All the while, I have been trying to kill it as much as possible in my land venture. It has been a lot of fun.

What does a company commander do? That sounds a pretty cliché job in the Army.

I have 149 soldiers that I’m responsible for their health, safety, wellbeing and training every single day. It is very likely that I’ll get a phone call about something that has happened, unfortunately, that negatively affects the unit and that soldier is involved. It is very stressful. It is not a 9:00 to 5:00. It is a 24-hour duty that I’m on at all times for that.

When I was an Army officer, I was expected to have my phone glued to my head, no matter what time of the day and nighttime it was. I was always on call, almost like a surgeon that has to come in to catch a baby. Here is the thing about doctors. I’m nothing against doctors but they get to put that phone away a couple of times a week or hand it over to somebody else. Do you ever get to do that?

No. After that doctor catches the baby and sends that person home, that was pretty much it. I’m checking up and always having to stay in contact with that individual, and make sure that they are always safe, healthy, and all of that. It goes beyond what any doctor would have to deal with on a day-to-day basis. It is a burden but it is a blessing too in a lot of ways. I had an impact on a lot of people’s lives because 149 people look to me in my command team for answers, guidance, and all of that daily. It is very rewarding in that regard.

Leadership at its finest. You are also not just responsible for 149 soldiers but also their families, spouses, children, as well as all the equipment that you are in charge of as well.

Hundreds of millions of dollars worth of equipment.

You got a lot on your shoulders. You are a very busy man. You have got a wife, 3 children and 149 soldiers looking to you. You also have a land business. What has been going on with that? What is that looking like?

It has progressed certainly over the years. I hit my one-year mark from when I sold my first property. I sold my first land deal on July 5th, 2020. I remember it very distinctly because it was right after I had people over the day before for the July 4th holiday. I wake up the next morning after posting a deal online. On July 4th, 2020, I posted that property online. I saw that I had a response and the dude wanted to buy it the next day. I was like, “We got this first one. It really works.” I posted it on Land Century because it is cheaper than LandWatch. I was wanting to be as minimal in cost as possible at the time because I was wanting to jump into this full gear but still, I had to budget. It is $79 a month.

The first posting is $15 for the first listing. It is so worth it. $15 for 1 month, you get 1,000 eyeballs on your property.

You’re actually working less when you do the bigger properties because you have other people involved.

I bought that property for $1,500 and sold it for $9,500 on that one. I was getting $300 a month for the next years. The funny thing about that one is I could sell that again. The dude did not pay for several months. I sold it a second time. After that, it’s already gone. I sold it for cash. I sold it on terms for $300 a month. After six months, the guy stopped paying. After several months, I had to repossess it. It was the last thing I wanted to do but I had to do it. It was my first one. I ended up selling it for $9,500 cash the second time after that. That property that I bought for $1,500, I made maybe a little over $1,000 on the first sale and I sold it a second time for $9,500. I made $9,500 to $10,000 on that property in total profit.

You must be able to get your initial investment out of it with that first buyer. Unfortunately, that was the dirty part of this land business. Sometimes people do not pay. They will pay the down payment, then they’ll pay for 6, 7, 3 or 2 months and we are profitable. I have gotten my initial investment back and then I sell it again. That is infinite profits. That is printing money. It is like the US government. That was just the first deal.

I was buying properties for $1,500 and selling them for $5,500. I got to the point in the first 6 months that I was selling 3 or 4 of those a month, consistently, making $9,000 to $12,000 a month. That is a goal right there. That is life. That was $120,000 a year or more that can be a secondary income for somebody. They can stay at that level for the rest of their lives and be happy doing that.

That secondary income was more than most Americans make in two years.

It was more than I’m making as a Captain in the Army. I was doubling my income right there, but I have to grow, build and see how far I can take something. I want to go all-in. That is when I decided I was going to stop buying desert square properties and focus on higher value and what’s called better properties. It is better properties for a few reasons and it is a better experience. The quality of buyers and sellers are different from the desert square properties where you are buying and selling infill lots that are a quarter-acre, buying it for $10,000, $20,000 to $30,000, and selling it for $50,000, $60,000 to $100,000.

That is a different process because you are involving title companies and putting it on the MLS. All of that work you are putting in to make $10,000 a month, you are allowing a title company, a real estate agent and the MLS to do all of those steps for you at that point. You are working less when you do the bigger properties because you have other people involved. You have to pay them a commission and they get their fees, but the spread is so big that it does not even matter.

You are implementing a team that is there to support you in the effort. Everybody is getting a piece of the pie but your pie is way bigger.

WI 889 | Selling Land

Selling Land: Always look for that new location, that new area. That area could literally be 15 minutes down the road from the area you’re already in.

 

This is a team that is not on a payroll that is doing their job. They are still working for you but you are paying them out of the sales and transactions that deduct themselves automatically. You do not have a team per se that you are paying every month.

They are paid to perform.

That is what I want to go into with my whole method and how I keep myself from going crazy daily doing this because of those teams and the systems that I had in place with those teams, and how phenomenal they are. I got to give them credit because I do not think every title company and real estate agent is like the other either. Thank God I have found the right people to take this journey with me and do this. It has been phenomenal.

That is key. It is the right people in the right seat. How did you find those people? How many did you have to go through to get the right realtor and title company?

It is still an ongoing process because every time I move into a new place, I want to find the right people. I set those things up initially before I started doing a lot of purchases in that area. For instance, I sent out a mailer to an area and got some mail back. I started shopping around with different real estate agents in that area. I wanted to pick their brain. I did not lie but I acted as though I already owned the property because I’m about to have it under contract anyway. I’m purchasing agreements.

Show us a businessman who does everything themselves and doesn’t hire people, and then we’ll show you a businessman who’s miserable.

I will call up and be like, “I see you are a realtor in the area.” I make sure that they are somebody who specializes in land and they care about doing land. I say, “What is the base bottom level price that you can sell this property for 30 days. What can you push this out the door in 30 days?” They would tell me and I would call another place, then another place. I take away the outliers and I would find the pretty consistent ones. I had them send me MLS stuff. They gave me access to MLS for those particular properties.

I compare the properties in this ZIP code and the size that I’m looking for, and then I could look at the sales. I could see the things that were sold. I then started taking note of the agents that sold the properties, not just the ones that listed them but the ones that sold them. They have a track record of success. I kept seeing a name pop up, the same dude. I was like, “I am going to call this dude. This guy has been successful in the last months selling these properties.” I called him up. I was like, “I have 5 or 6 properties here. Can you give me what you think you can sell them all for?”

I got these properties, Brent, for $5,000, $6,000, to $8,000 under contract each. He was throwing out numbers like $45,000, $55,000, $65,000. I was like, “Do I believe this? This is $20,000 worth of plan that I’m about to buy. Let’s pull the trigger and see what he does.” This guy sold every one of those properties in the first two months like I was paid. It was phenomenal.

Success leaves clues. This guy is the one that keeps popping up on the MLS. Would you list it with the guy you have never heard of or the one that keeps bringing the buyers for these parcels of land? You hit it on the head, land specialists. Not someone that deals in $600,000 or $700,000 homes. You are looking for someone who deals in the land, $50,000 to $60,000 parcels. What is this guy doing to sell these things? Does he have a buyers list?

He has a huge buyer’s list. He has been in the area selling property for many years. He knows and lives in the area. I pay him 6%, which is fine because he is doing all the work. I have a LandWatch and Land Century account and I keep them on there. Hopefully, maybe I will use them for tax purposes. I will deduct whatever I spend on that type of stuff. It is better to have it and not use it for me at this point. If I want to use it in the future, I still can. I have it if I need to.

WI 889 | Selling Land

Selling Land: The whole point is scaling the business. You don’t have to necessarily hire another person. You could put a digital platform or a system in place to help you scale without paying other people to do it.

 

You go to get rid of those expenses. I call them phantom expenses. Sometimes I’ll look at my AMEX because a lot of our stuff goes on our AMEX every month. I will be like, “We have not used this in 3 months or 6 months. These charges add up,” especially for Land.com if you are not using it. The best way to get rid of all those is to cancel your card and report it stolen. All those things stop charging you and you get a bunch of emails from aggravated companies. The ones you are still using, just give them a new card.

The point is if I need it, I have it. I’m selling them so fast that I do not even have time to post them. The target market to who I’m selling it is probably not going on LandWatch. I do not think they are looking at my land on LandWatch because I’m targeting contractors. When you look at the market and everything, there are not enough new home builds to keep up with people that want to be first-time homebuyers to buy new builds.

They do not always want to buy that rehab house. They want to be the first person that lives in it. They want it to be theirs and all of that. They want it to be built with the layout they want. What do you need for that? You need somebody to build it. You need a builder. What does the builder need? He needs some land to build that house on.

What do builders want to do? Build. They do not want to go out and source land like you are. They want to grab land. They will pay retail for it because you have made it easy for them.

What I have found is a builder wants to pay about 20%. Their budget for the land is about 20% of what they want to sell a house for.

Is that still true with these high crazy lumber prices?

The lumber prices are starting to go down quite a bit. If you target areas where all the houses in that area sell for over $500,000, what is 20% of $500,000? It’s $100,000. I want to target those places but I want my offers to be no more than $50,000.

It does sound like you are making much money there.

My average deal looks like I buy for $20,000 and sell for $65,000 to $75,000. That is a very common deal that I do. If I’m selling for $70,000 times.06, that is $4,200 off the top. That is what my realtor is going to get. This is how I do every deal. I add $2,000 of that. It is probably going to be less but that is fine. What that covers are the title company and my survey.

I always purchase a survey on the buy-side. That way, I always have it ready for the sales side. When my realtor goes to sell this property and says, “Who is going to pay for the survey?” You have it when you put the offer on the property. There are no surprises like, “There is a guide pole in an area that I do not want.” I came into that situation but there is a guideline here like, “We are going to cancel the contract.” “No dude, you already paid your earnest money.”

Is that where you sent me the pictures where it was going right through the property?

It was on the edge of the property. It was not even part of the building where the house platform should be. It was not an issue, but just things like that. The buyer can’t say at that point, “I did not have all the information on his property.” They have everything right from the beginning. Their time for termination has already passed. We give them 7 days now because we were giving them 2 weeks.

You are giving them all the information that they can make a decision right there and they are locked in.

I got one under contract where we gave him three days. It was $2,000, earnest money, $300 termination clause or whatever and then 3 days. That three days have already passed so they are either buying this and closing on it or I still get $2,000. That pays for the survey, the title company and everything. Every time that something has not gone through the first time, it is gone through the second. If you think about it, I made $2,000 more on that property than I thought I was going to. It always worked out.

People are thinking, “How the heck is he buying all these properties?” You mentioned, “I’m buying $20,000 worth of land,” like nothing. How did you get there? Where are you finding all this money to buy all this land to turn around and sell it?

I roll everything back into the acquisition funds. I pay myself a salary because my wife takes care of our kids. She does a job that I do not want, to be quite honest with you. She is like a saint. She takes care of the kids and the house. I never have to worry about anything on the home front. It’s phenomenal. I love it. This has allowed me to have a secondary income without a spouse that has to physically go to a W-2 job.

We always say our wives do not work when they stay at home. We get to call it work if we leave the house and get away, but their job never ends. They are always working even when they are sleeping. Our daughter woke us up three times and I’m snoring away. She is working all night and day.

I’m paying myself that monthly income, then I’m rolling all the money back into it. Every time I make money, that builds up my acquisition pool of money even more. It is the way I think about it. I do not have to live off that money. I am simply an Army officer and I still live off that salary. Everything else goes into my savings account or back into my acquisition funds account. That’s it.

I imagine this massive snowball that you are building. It could be worth millions of dollars in a couple of years.

I did not make $1 million but I sold $1 million worth of property from January through July.

A lot of realtors say that and they get to make 6% on it usually. I always think, “We have a big deal. It’s $1 million.” You are making $0.30, $0.40 sometimes $0.50 on the dollar for that. I’m doing a calculation. I do not want to put words in your mouth but what would you say the net profit is? After the title company, the surveys and your realtor are paid, what would you say is the net that you are getting to keep out all of it?

I feel weird throwing these numbers out. I’m making six figures a month net profit. I’m averaging a $100,000 a month profit net. That is after the title companies and my realtor. My realtor made six figures off of me probably. That is why he loves me. I can’t say I’m his only client but just off of me, he has made $90,000 to $100,000.

Don’t be afraid. When in doubt, send mail.

I assume it is $100,000 a month minimum. You are probably sitting around $700,000 net profit in your first year in land.

In the first twelve months, yes. I have only been doing the infill lots and these margins since January. It is looking like it is going to be a good year. My goal for the year once things start getting rolling probably in April, and I understood that this is repeatable and consistently happening, I thought, “If I get this $700,000, that would be awesome.” June rolls in and I’m already there. I’m like, “What is the goal?”

That is my next question. Where are you going with it all?

I will change it up a little bit but the fear for me is this and maybe it is an unrealistic fear. Is the fishing hole going to dry up?

It could but what happens when one fishing hole dries up?

You just moved the boat over to another fishing hole. As investors and land flippers, what we always have to keep in the back of our minds is, “I’m always looking for that new location or area.” That area could be fifteen minutes down the road from the area you are already in. I’m finding that out too. It could be the next county over. I’m going to do a mailer on one county over because it has similar attributes. It has moving lands. I’m going to test the waters over there. I’m going to send out probably 5,000 pieces of mail in that area and see what goes from there. You can go with my systems a little bit if you want to.

Are you still sending LOLs or postcards? When you say mail, what does that mean?

It is a two-page offer letter. The first page outlines who I am. The intent is to build a little bit of trust. The second page is the actual purchase agreement itself, which has the APN legal description, the acreage and all of that on there. It gives them a response by date. It has the bottom right place where they can sign, put their name, email address and phone number.

They can take a picture of it. I do not even care, text it to me. All I have to do at that point is email it to the title company. They put it under contract and I’m good to go. Other things go along with that. I use DocuSign for some things and Fiverr. If I ever get a purchase agreement back that says, “I will not accept $15,000 but I will accept $25,000.” I will have them scratch out that number right in the other number initially, take a picture of that and send it to me. The title company takes it like that.

An extra $1,000 does not mean anything when you are going to make $50,000 to $60,000 on it.

I want you to understand how easy it is. You do not have to send them a new document. They can scratch it out right in their number, initial it and send it to you. There is no more work to be done. You do not have to mail them a whole new mailer.

WI 889 | Selling Land

Selling Land: Send a lot of mail. You’re going to get responses because you send 5,000 pieces of mail. You’ve paid $2,000 for it. All you need is one, and that’s going to make you $30,000. The rest doesn’t matter.

 

You do not want to do that because most of the time, these sellers are not super tech-savvy. You want to keep it as easy, simple and convenient as possible for them.

Show me a businessman who does everything themselves and does not hire people and then I will show you a miserable businessman. There is a lot of truth to that. However, the whole point is scaling the business. It does not have to necessarily be hiring another person. It could be putting a digital platform or a system in place that helps you scale while keeping all of your money without having to pay other people to do it. I’m still in the business but I’m scaling in a way to simplify all the processes as much as possible. How do I do that?

You are automating and putting systems in place rather than people.

Let’s say something else, even your mobile banking. Have an understanding that most title companies will send you on the buy side a contract that is DocuSign. I was on a Spur Ride. It is something you do in the Army when you are in the Cav. It is a Cav tradition. It is a test for anybody that is in the Cav so you can wear spurs on your boots after you complete this task. A group of people go out on a land nav, ruck march/getting smoked at every turn type scenario. It is all day. We start at 3:00 in the morning. We go out in the middle of the woods somewhere to this very random location and start walking with the 40-pound ruck on our back as a group.

For everyone to know, getting smoked is like push-ups, sit-ups, flutter kicks and jumping jacks. It makes your butt sweat. You feel smoked afterward.

You ruck 6 miles right out the gate. You have your two MREs and backpack or rucksack. You come to a location and this is your medical location. You are going to get trained on medevac procedures, 9-line medevac cards and all this stuff. They smoke you for 20 minutes and you walk 2 miles to your next location. They are training security or something like that. There is a test for Army knowledge at every destination but then they smoke you at every destination before you walk 2 miles to the next destination. You have a 6-mile ruck at the end.

By the end, you have rucked, hiked or marched 27-some miles. You do this from 3:00 in the morning until 10:30 at night. You are done at the end of the day. In between, while I was eating my MRE, I closed on a property on the buy-side because I was able to use my phone. I had the title company send me a contract and close on the buy-side. I signed the contract digitally and then wired my money to purchase the property to the title company, all from my phone while I was in the middle of a Spur Ride in the Army. That is how easy it is on the buy-side.

On the closing side, you have to have a wet signature. That is as easy as setting up a mobile notary. After PT, I have to be at work at 9:00 in the morning. I simply have a mobile notary sent to this Bite The Bagel is what it is called. It’s a little bagel shop right off the base. They go there and I meet up with them. I did two closings on the sales side simply with that mobile notary, signed, all my stuff, and went to work. Nobody knows the wiser that I had even done that on that day.

Nor the bagel company like Black Bear Diner right outside of Fort Carson. They close at 3:00. Most of the time, it was outdoors. We couldn’t even get coffee. We were just using the patio.

Little does anybody know at work that I made $120,000 at 8:00 in the morning at Bite The Bagel. I went in and did my job the rest of the day. You walk into work and it is like, “Nothing can bother me today.”

They probably know. They are like, “Daniel did not make $120,000. He is in a bad mood.”

My point to all of this is there is automation, finding the right title company and real estate agents that will work with you every day, that send you notifications and updates. It is a matter of checking your email. Do your digital signatures and have your mobile notaries, which my title company pays for it. I do not even pay for them for the notary. It is $150. With this other title company I used to use but this title company covers that bill. I’m not going to have to pay for that. That is my whole point. This is the way to do this, no matter what.

Your system would not work for me because you said I had to check my email. I hate checking email. I’m lazy at it. I tried to hire someone to do it but I had to fire that person. I’m looking for someone else to check my email.

I see it differently. Every time I get an email, it is like I’m making money. That is the way I see it. If I’m getting an email, there is action happening. If I do not get emails, that means I’m not doing something.

I’m good at sending them. I do not like to read them.

I do not like reading my Army email. They are the ones that I hate.

I’m going to give you a pro tip, everyone in the Army. Anybody that has been an Ex-O or commander, when you get at the end of the day, got done with a Spur Ride, had twenty meetings or got your butt chewed by the battalion commander, whatever it is, you click on the top one, scroll down quick, hit the shift button and click on the bottom when it hit the leaf. Go back in the next day, everything is fresh. If it is that important, they will send another one.

I believe that. It is probably true.

Do not do that. I do not recommend that. I did try it a couple of times.

You are making big bucks as a civilian.

It is way better being a civilian because you do not get away with that too many times in the military. You have shared so many golden nuggets. I wanted to let you talk the whole time. I had so much I wanted to add but I wanted to hear everything you had to say. What would you have told Daniel Watson years ago when you were looking at getting started in land?

It is the same thing I tell myself now. Do not be afraid. When in doubt, send mail. Send mail often. Send a lot of mail. You are going to get responses because you send 5,000 pieces of mail and paid $2,000 for it. All you need is one that is going to make you $30,000 and the rest doesn’t matter.

It is like, “Why do I have these rhinoceroses as my background here? They are always charging.” When they are in doubt, they charge. That is the same thing as sending mail. Thank you so much. I appreciate you taking your time to talk with me and give all these golden nuggets to our readers.

I appreciate you having me on. I hope this helps somebody. The whole goal here is to uplift other people, take that doubt out of their minds and go after it. Take that step and move forward with your land business.

It has helped. I know it will. I’m looking forward to seeing where you are at in six months. If you are looking to get started in land and you think that it might be right for you, head on over to WholesalingInc.com/Land. Fill out the form and schedule a call. We will see what your goals are in real estate. If you feel like we are a great fit, I’d be honored to coach you.

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About Brent Bowers

WI 865 | Land DealsAs an Army Officer with over 8 years of service, Brent Bowers was spending a great deal of time away from his family, and he knew he needed to make some changes in order to be more present with his wife and children. His interest in real estate began in 2007 when he purchased his first home, so Brent began exploring real estate investing as a way to support his family while being able to enjoy more time with them as well.

In a short amount of time, Brent was able to expand his business, hire a team, and (most importantly) spend quality time with his family while still working hard and helping others. While Brent invests in many different types of real estate, his favorite investment strategy deals with buying and selling vacant land, and he enjoys sharing his expertise in this area with his coaching clients. Brent chooses to live his life based on Bob Burg’s quote, “Your influence is determined by how abundantly you place other people’s interests first.” He is passionate about helping other people find success in real estate investing, particularly in land investments.

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