Brent Bowers 0:00
The realtor said, Well, you could put it on the on the MLS for maybe $10,000. And I was like, shocked, completely shocked. I knew it was a beautiful property. But I was like, Okay, I think this is a deal. So I hung up with her. And two minutes later, she calls me back and says, Hey, would you be interested in selling that land to me? And I just thought she was messing with me. I was like, well, what’s your offer? Just kind of playing with her, you know? And she said, I could probably do $5,000 and me being the amazing negotiator I am. I said, Okay, let’s do it. When do you want to buy it? And she said, we could do it next week. So her title company contacted me. So it was a Tuesday I paid the guy that $325 for the land and Wednesday I got my $5,000 check.
Welcome to CRE PN Radio for influential commercial real estate professionals who work with investors, buyers and sellers of commercial real estate coast to coast. Whether you’re an investor, broker, lender, property manager, attorney or accountant We are here to learn from the experts.
Welcome to Commercial Real Estate Pro Networks, CRE PN Radio. Thanks for joining us. My name is J. Darrin Gross. This is the podcast focused on commercial real estate investment and risk management strategies. Weekly, we have conversations with commercial real estate investors and professionals who provide their experience and insight to help you grow your real estate portfolio.
J Darrin Gross 1:00
Today, my guest is Brent Bowers. Brent was an army officer spending way too much time away from home. And he knew he needed to make some changes. And that is when he found land and the ability to create a passive income with land. And in just a minute, we’re going to speak with Brent about how to build passive income through land. That gives you a life that allows you to do what you actually want to do.
But first, a quick reminder, if you like our show, CRE PN Radio, there are a couple of things you can do. You can like, share and subscribe. And as always, please leave a comment. We’d love to hear from our listeners. Also, if you’d like to see how handsome our guests are, be sure to check out our YouTube channel. And you can find us on youtube at Commercial Real Estate Pro Network. And while you’re there, please subscribe. With that, I want to welcome my guest, Brent. Welcome to CRE PN Radio.
Brent Bowers 1:44
J. Darrin Gross. Thank you so much for having me on CRP, CRE PN Radio with a name like that, you know, this is an elegant show. And you know what? My mom always told me that I’ve had the face for radio, not the face for zoom, or YouTube. So this is new to me. So I will try to do my best. And I’ll try not to, you know, do weird things with my face while while I’m looking at it here. So hopefully, it’ll be fun for the listeners. Thanks for having me.
J Darrin Gross 3:05
Yeah, glad to have you. And you know the listeners Be sure to go check this out. Because I mean, you mean this is quite the site here. You’re gonna like it. There we go. Little little teaser. No, no, yeah, this is great that I welcome you. And thank you so much for taking part in this. Before we jump into our conversation, if you could take a minute and just share with the listeners a little bit about your background.
Brent Bowers 3:31
Yeah, absolutely. So my background, I got a real estate license in 2007. I also bought my first home which it turned into a rental property pretty quickly in 2007. Because I was moving to the coast to rock my real estate license. Everyone knows what happened in Florida in 2008. I was kind of hitting the ground running at the absolute worst time and I had to sink as low as driving people around in my car all day long. and showing them rental properties. I would get to these properties early and open the windows and turn on the air conditioners because for some reason these landlords didn’t believe in leaving the air conditioner on and it usually smell like a stinky old cat. And just things weren’t working out for me in real estate in 2008. So I joined the military in 2009. I still had a great passion for real estate I still I was studying. And I had rented that property out get back from my first one year deployment from 2000 from November 2010 to November 2011. And I come home to a trashed house where we had to evict the tenant and my wife was really upset with me because I just been gone a year and we didn’t have any money because it all went into a rental house and oh by the way, I was managing it from Germany. So it was literally hell on earth for me at that time. Did a second deployment about a year later. And I was just always gone. So I knew there had to be a better way. Then the military, I love the military, respect it in six days, actually Veterans Day. Thank you.
J Darrin Gross 5:09
I was gonna say I wanted to say thank you for your service and recognize that it is Veterans Day. So
Brent Bowers 5:15
Yeah, thank you to all the veterans out there. And I mean, I believe that so much I was in the military eight and a half years. But my last couple years, I knew I had to find my way out. Because I had, I went from enlisted to an officer. And what I, I always was just an all these officers. But what I didn’t see was that they would get there a couple hours everyday before all the enlisted soldiers and they will stay a couple hours longer just to make a little bit more money. And it just wasn’t for me. So I got it. I got back in the real estate started looking at rental properties, wholesaling. But I stumbled upon this great little niche called land. And it’s actually been one of the biggest game changers for me, because there’s virtually no competition, everybody’s going after the houses. So that’s a little intro about me, I don’t know how much you want to get into it and how you want to go from there?
J Darrin Gross 6:09
No, we’ll definitely get into it. So the sounds like you, you had kind of more of a traditional start to real estate you got into single family rental had the frustration of a trashed property than sound like you’re making any income either with money going back into the property Is that a fair assessment?
Brent Bowers 6:30
That’s 100 cent per cent fair, it actually got trashed three times. And you know, for those guys that do residential rental properties, or even commercial rentals, you learn through those hard knocks, I no longer put the highest paying tenants in the house anymore, I put the lowering the basically the high credit, the lower paying tenants because the guys that have the 700 credit scores, they don’t have to pay top dollar so we learned that lesson the hard way it only took like three times figure it out.
J Darrin Gross 7:00
And been there been there done that the credit scores and actually calling references and all that stuff. Definitely a good good note any any listeners out there that are looking to become landlords? So then you did you or you were doing real estate as a as a realtor, you went into the military when you came back? What was the the path? Or did you? Did you look for more rentals? Did you get frustrated? And then you found land or what was the?
Brent Bowers 7:32
Yeah, it was kind of more more rentals more frustration. When the army pulled me out of Afghanistan, or Afghanistan the second time to send me to school to be an army officer, they sent me to a place called Melbourne, Florida. I went to the Florida Institute of Technology. And I actually was renting a room from a guy for a little while because it was like a quick transition. I had like two days to start class I found a rental and it was actually a room. And you know the guy, it was just kind of a dirty house and he never took care of the cat litter box. And I didn’t grow up with cat. So I was like changing this cat litter box every day. Because it stunk It was like right outside of my room and I was feeding this cat and I was like, You know what, I’m gonna buy my own house. And I can do the same exact thing, but on a way better scale. So I did that and then kind of refinance about three months later pulled some cash out and bought another one. And I was like, you know, there’s something to this. However, there’s got to be a better way a faster way. So I started looking into wholesaling houses. And I did that a couple times. And it was actually perfect timing because I had to pay for some classes. And it just wasn’t really my thing. Um, so I started mailing the vacant land list as well. And once I mailed that vacant land list, my phone absolutely exploded. And this list was the tax delinquent list. But it was a vacant parcels of land like when I say vacant, I mean nothing on it. No structures, no house, no Well, no septic no driveway. These guys were blowing my phone up because they’ve never seen an offer or a mailer on their land. So I went and looked at this land. And I still remember the first one I bought, it was actually non buildable, you couldn’t access the property without trespassing on state land. And the guy couldn’t figure out what I wanted with it. And I ended up paying them $250 for this parcel of land, so and come to find out he had traded it years ago because he was a CPA. So you got a question there. I see your face. Go ahead. Well,
J Darrin Gross 9:41
no. The the kind of a landlocked piece of land. You mentioned the trespass? Non buildable $250.
Brent Bowers 9:52
Who would want that right?
J Darrin Gross 9:53
Yeah. So yeah, let’s talk about what what were the what were your thoughts that cause you to to buy it.
Brent Bowers 9:59
So when I looked at this piece of land because I actually went and drove and looked at it, I don’t look at my land anymore. But when I looked at this parcel, I just fell in love. I mean, there were beautiful pine trees. And it’s just the most beautiful piece of land. And I know, a property that if I can get this at such a massive discount, there’s got to be a buyer out there that would want this. So what did I do? I just stuck it on Facebook, took some pictures. And once again, my phone absolutely exploded. Oh, by the way, I disclosed, you know, not accessible. There’s no road going to this. It’s not buildable. Yeah. So you know, and this, this property was actually in Colorado. So I’ve gotten to Colorado this time. So I and I hit the ground running. So I wasn’t in Colorado very long. But I just knew that this parcel of land in this area was worth a bunch of money if somebody could figure out how to get ingress and egress to be able to get in and out. And you know, a realtor told me that you can’t stop someone from getting to their land. So I figured that something that an attorney can take care of right. So I put in Craigslist ad that not buildable not accessible, need an attorney to get access. And I marketed it for $5,000. And before I knew it, I had someone that put roughly, I think it’s $500 down and paid me $500 a month until the whole whole note was paid off. So it’s just and we did those multiple times. I can tell you that. How
J Darrin Gross 11:27
long was the so you close on the deals to $250?
Brent Bowers 11:33
Now Yeah, $500 down. But I don’t know, but you bought it for 250?
J Darrin Gross 11:37
Yeah, yes. And then you got 500. So what was the time between the acquisition and the and the sale?
Brent Bowers 11:47
Oh, two weeks, two weeks. So $500 a month for 10? Or it was like nine months because they’d already gave me five $500 down. I didn’t charge any interest because I didn’t know how to calculate all that stuff. And people asked me today, why don’t you charge interest? or Why didn’t you charge interest? I didn’t know I was just kind of we were building it as we went. And it’s just it was just incredible.
J Darrin Gross 12:10
So you’re hooked.
Brent Bowers 12:12
I was hooked. I was I did a second one. And I called the realtor. The closest I bought a second property that was not buildable. And this one was overlooking the pike national forests. Another property I think I paid $325 for this one. Well, I call a real estate office a mile away. And the realtor tells me Yeah, that land is not buildable. Here’s the reason why. It was one Ingress egress, they were afraid that if the firefighters went in, they can get pinned down. So they had to build another road over the railroad tracks. I was like, well, what’s it worth I got, I’m gonna buy it. But I want to be able to blast it out really quick, because I can’t keep like I didn’t have the money to just leave it sitting in a property like that, even though it was $325. That was that was grocery money I was spending. So I was literally pre selling this land. The realtor said, Well, you could put it on the on the MLS for maybe $10,000. And I was like, shocked, completely shocked. I knew it was a beautiful property. But I was like, Okay, I think this is a deal. So I hung up with her. And two minutes later, she calls me back and says, Hey, would you be interested in selling that land to me? And I just thought she was messing with me. I was like, well, what’s your offer? Just kind of playing with her, you know? And she said, I could probably do $5,000. And me being the amazing negotiator I am. I said, Okay, let’s do it. When do you want to buy it? And she said we could do it next week. So her title company contacted me. So it was a Tuesday I paid the guy that $325 for the land. And Wednesday, I got my $5,000 check.
J Darrin Gross 13:48
Brent Bowers 13:50
I was hoping that I was hooked on the second one, actually. Because the first one I didn’t believe it.
J Darrin Gross 13:55
Right. Right. a fluke, right? For Now. Now. It’s now it’s actually workingax work and you’re making money
Brent Bowers 14:01
Yeah, making money.
J Darrin Gross 14:02
So so that’s so let’s back up for a second because I think there’s there’s a couple pieces in here that I think people that aren’t familiar with the whole land you know, opportunity. The first is that you bought low and sold high. But with that you also have the the financing aspect of that. And you mentioned that the first one, you didn’t charge any interest. I’m assuming that given that that’s a point that that’s been made or mentioned that you’ve since figured out a way to make more with even charge or per for interest for an owner carry kind of a of a sale. Is that fair?
Brent Bowers 14:48
Absolutely. We still do a lot that are zero percent interest but on our larger parcels, the bigger parcels because we’re now doing 30 year mortgages for some of them. We do charge interest on those and we also charge interest, whenever someone’s like, Ah, this is you can’t sell this piece of land, you’re asking too much. So we’ll lower the price and then charge interest and we could pretty much get the same price. Just amazing people just see Americans, they just see, like monthly payment.
J Darrin Gross 15:15
Yeah, it is a kind of a trap we’ve all been exposed to and encouraged to participate in. Let me ask you so that the parcels you’ve described here, the two that we’ve talked about have primarily been unbuildable. Are these acres are they you know, 50 by 100, you know, describe some of the the size and what’s the, you know, what, what the, I guess, give me a sense of what the scope of opportunity and the different types of land that you’ve come across.
Brent Bowers 15:49
So yeah, there there’s a couple different types of land with they call them infill lots like the buildable lots in the city, that’s 5000 square foot, 7500 square foot, and then you’ve got recreational land, it’s like a, it’s like an acre, two or three acres, maybe in the mountains that you would want to build a cabin or a tiny home. And then you’ve got the large parcels, which I call agricultural land, I don’t generally buy a lot of agricultural land, because if a farmers working their land and making money on it, or ranchers ranch in the land with cattle or sheep or whatever, they’re probably not going to give it to me at a massive discount. I’m looking for that landowner, that usually doesn’t step foot on that land, or they inherited that land, or you name it. husband bought it or builder bought it and passed away these type things. So these two first parcels of land that I gave the example of one was four acres, the first one, and that was the one that I got the $500 down 500 a month on, I would call that recreational land because it was like four acres in the mountains. This second one, the one that I sold to the realtor for five grand The next day, that was like a that was kind of like an infill lot, because they were all subdivided. They’re all I think 7500 square foot per parcel. So though that’s what I would call an infill lot. Now we kind of focus on the infill. And the recreational mostly, because those are the ones that are easiest to grab, you know, and, and really will still buy agricultural land, but it’s usually not generally something that’s being farmed or ranch as well. So I mean, I’ll buy any land that we can get at a massive discount and turn around and sell it at easy payments.
J Darrin Gross 17:36
Got it. So it sounds like kind of the key to this is you find a property that the seller doesn’t, it’s kind of a don’t want, or they’re just there’s not, there’s no attachment to or they’re there, they’re ready to get rid of it.
Brent Bowers 17:54
Because that’s exactly right. They’re ready to get rid of it. They might be out of state out of county. I mean, we bought land from people that actually own land next door, and they don’t have any plans to do anything with it. So most of the time, they’re behind on taxes. But sometimes they’re not either. It’s just really weird, though. But the funny thing is, is that emotional tach, it’s not like houses, like they didn’t grow up in the house, or they didn’t have their children in the house. It’s just vacantly, and it means nothing to them most of the time,
J Darrin Gross 18:24
right? You mentioned taxes, is that a source of potential sellers that you that you look to? Or is it more of just it’s got to be vacant?
Brent Bowers 18:36
Yeah, I’ll start with the low hanging fruit first. So that’s behind on taxes and out of state. And once we run out of mailing, those guys will mail all the vacant land in a particular area that we’re interested in. So obviously, we’re gonna start with the low hanging fruit, and then kind of move up. What’s cool, though, is if they’re not behind on taxes, you know, there’s less problems to deal with. Because sometimes, you know, the taxes are so high, we’ll always have to get the land for next to nothing. And that always hurts making that offer.
J Darrin Gross 19:06
Right, right. So, you know, this is kind of a new, a new thought for anybody that’s always thought they had to have a tenant, you know, to make make money. You know, like you experienced in your first couple of rentals, you had the tenant destroy your property. And that’s kind of more of a tenant selection lesson that you talked about. So in in land, it fair to say that the the way you make money is to turn it fast. I mean, there’s no, there’s no income if you have just a piece of land that you own.
Brent Bowers 19:45
Right, get that monthly payment come in as fast as possible. So we generally have a rule of what we want to make. So if we buy the piece of land for safe, you know, $5,000 and we want to sell it for 15,000. And someone can only come Come up with, say, $300 in 250 a month for the next however many months to get to that $15,000 Mark, we’ll get a buyer in there as fast as possible. Because when we don’t want to break the bank of the buyer, we want them to be able to pay every month on time. But yes, absolutely a piece of land that’s just sitting there is costing us money in taxes. Maybe it’s in a land owners Association, or an HOA, like we don’t want that we don’t want the liability, like as Robert Kiyosaki would say anything taking out of your money out of your pocket is a liability, anything putting money into your pockets and assets. So as soon as we put a buyer into that land that pays us the down payment, and the dock fee, and the monthly payment, it’s now turned into an asset. So we’re kind of like the, you know, the planet fitness model. But for land, you know, Planet Fitness has all these members paying a monthly fee. And that’s kind of what we’re looking for, for the land. And once they pay it off, we transfer the deed over to them. And they’re now the new owner.
J Darrin Gross 21:00
Okay, and let’s talk a little bit about that. Because you mentioned it’s once they’ve paid off the property that you transfer the deed, can you go into that a little bit and compare that to it to typical property sale?
Brent Bowers 21:16
Yeah, there’s two ways to do it. Well, here’s two ways I’ll explain that we do it. Generally, we like to do a land contract or a contract for deed, same thing, you know, talk to your attorney in the state that you’re doing this in, but all land contract is just says, Hey, Darrin, we’re going to sell you this piece of land for $5,000 down, you’re gonna pay us $100 a month for however many months. And as soon as you’ve paid that full 5000, I Brent Bowers will transfer this land to you, I will transfer basically do the transfer deed or, or transfer document or a deed, I’ll put the deed in your name, we’ll record it will file it for you, send you a copy, send you the original, whatever we try and do it within 30 days. And now Darrin, you are the owner of this piece of land. Another way you could do it is we can go to a title company, we just did it with a subdivide that we did in Florida, we bought 27 acres in Florida and turned it into three parcels of land. So these guys are putting $40,000 down for this land. And the total purchase price is 74,000. So they came to the title company with 40,000 put it in escrow. And we actually transferred the top of the deed to the buyer. And now we have a deed of trust and a promissory note. So if they don’t pay will foreclose and take the land back from them. So there’s two ways of doing it. You know, my, my attorney, you know, she was a little, you know, skeptical of the contract for deed until she wrote me a contract for deed that she felt comfortable with. The reason why I like to contract for deed is, you know, when you do $500, down and $100 a month, you’re gonna have something we call default, you know, there’s gonna be people that lose her job or get tired of the land, or they figure out that they’ve actually got to put a well and a septic in a driveway in a covert and actually do things to make this land buildable. And sometimes they’ll just say, Yeah, I don’t want it anymore. And that’s the sad part about this business. However, we just send a cancellation of contract, you know, we certified mail it, we send them an email text, we always try and work it out a new payment plan with them, whatever it takes, and we’ve been successful working it out. But sometimes we get the land back by canceling that contract for deed. And it’s so simple. It’s a mutual agreement. We don’t have to foreclose, we don’t have to pay an attorney. So I prefer a contract for deed, unless they’re putting a massive amount of money down for that for that property.
J Darrin Gross 23:52
Right. But But even in that, I mean, you just mentioned the foreclosure, there is no foreclosure.
Brent Bowers 24:00
Graphic contract for deed. No,
J Darrin Gross 24:01
yeah. If they haven’t met their contract their contract. What do you call it a contract fail? Or is it just a failure? I mean, what’s the
Brent Bowers 24:10
Yeah, and if somebody call it a cancellation contract, contract. Gotcha. And now you could have someone that gets behind and they want to fight you. And you might end up having to go to court for that. And a judge will pretty much make a decision on that, you know, like we try and make sure that the land buyers happy. We’re not going to fight with somebody on it. But we haven’t had any issues. In the few years we’ve been doing this, but I mean, you could have someone that says no, I’ve been paying on time and go to court with that, but usually you’re not going to go to court with someone that can’t afford to pay their payments.
J Darrin Gross 24:46
Sure. No, I mean, I think that you know, the point of all of this is it’s not like your first option that you’re looking to is to take the land back. Now. No way you want to get sold. You want to get your money and and You know, give them back, give them the deed, move on to the next deal.
Brent Bowers 25:06
Amen. Because when they get that Deed, they’re now happy land buyers. And guess what? Birds of a feather flock together. And they have friends and they refer them. It’s just amazing process how that works. They’re happy.
J Darrin Gross 25:18
Right? So So when when was the What time did you do the first deal? You’ve talked about a couple of points here. And I didn’t get the year, when was it?
Brent Bowers 25:28
I did the first land financing deal around 2017. So I haven’t been doing this a very long time. And this is still relatively new for my business model. I mean, it’s not like I’m some guru that’s been doing this 25 years, that’s I’m still in the business, I still have a team that I talk to daily on this, I don’t have to do the sales anymore, or the buying, which is really fun. But I get to have fun and see the process happening over and over and over?
J Darrin Gross 25:59
Well, let’s talk about what is your your process, we’ve talked about basically the, you know, the mechanics of it, find a find a property, you know, somebody doesn’t want, make an offer that they accept, and then promptly list and sell the property. Let’s talk about how you find the properties. You mentioned the the list? What I mean? Is there a I mean, is the list the secret? Can you talk to us a little bit about what your system is? How Yeah, what are the what are the keys that you need to be successful in land?
Brent Bowers 26:38
Key number one is, figure out what to do. And then key number two, I can sum it up in two keys, figure out what to do. And then number two is actually do it. And I would say the third key the bonus is hire people to help you do it. So you know, it’s getting done every single day. That was I see that’s the missing link from a lot of real estate investors that are not successful, they don’t build a team. So I would say that’s what’s made us the most successful is building themes. So process, here’s the process. So we pick an area I first started in my backyard. But now we’re in a few states, we’re in three states, eight counties. So let’s just use simple County, Pueblo, Colorado. So what we do is we went first for the tax delinquent list in Pueblo, Colorado, we sorted that list, some people call it scrubbing. I call it sorting, I hired someone a virtual assistant off of upwork.com to help me find all the vacant land on that tax delinquent list. And that’s how we started mailing first, eventually you run out of those guys to mail, and then you pull another list of all the vacant land in that county. So what we do is we send out what we call a blind offer letter. So we’ll start in like neighborhoods, or subdivisions, or a small city area. And we’ll figure out what that land goes for as far as retail price. Let’s just say it goes for $1,000 an acre, well, then I’ve got to back up and see what my offer price is going to be I generally try and offer anywhere 20 3040 cents on the dollar. Depending on the land, if it’s really obscure, or it’s just in the middle of nowhere, never going to have water power, we might offer 10 cents on the dollar. So we’ll offer the exact amount we’ll pay the seller in that letter, and then we will mail them well mail every single day of the week, and will start getting phone calls. And those phone calls will go to a voicemail say, Hey, thanks for calling about our letter. We’re interested in buying your land, please leave your name and the reference number. So we know what what we’re looking at. And then my intake manager, I call her my acquisition manager, Jen. She’ll call them back. And I think sometimes she’s actually taken live answer which I never could do because I had to be in the right frame of mind. I wanted to know the due diligence, but she’s gotten so darn good at this. She knows what what an area is worth. Now, because we mail the same areas. It’s not hard to master seven or eight counties in this short amount of time. So they’ll tell us what they want basically, or they’ll call or they’ll sometimes fax the signed offer letter back the blind offer letters. And sometimes they’ll email it sometimes they’ll mail it, and sometimes they’ll call which we prefer the least we want them just to send it back to us. We’ll look at it. Yep, we can pay that we contact them. We send the notary out there, we get the property deeded to us now if it’s a big enough property for spending a certain amount of money will will generally go through a title company. But we obviously do our due diligence, run the title search all that stuff that oh any the owners in a conference, we’re not just buying the stuff blind and then we take ownership of it and we immediately They start marketing it to our buyers list, we’ve now built a buyer’s list on a lot of websites, Craigslist, Facebook, we put signs out. So we’re always having people call in that are looking for parcels of land. So send an email once a week and sign them up to buy this piece of land, pay their downpayment, their Doc, their documentation fee, and we get that monthly payment coming in and rinse and repeat. So we have two machines, a buy machine and a selling machine. And then we just constantly turn it over. That’s really my my process in a nutshell.
J Darrin Gross 30:35
I think that’s that’s kind of what you know, I’ve come to come to understand that’s, that’s the key to this is you have to have a system. I’m curious. Can you talk about any little bit about the numbers? Yeah. How many numbers of properties? Are you? If you start with a list of 1000? Is that kind of a Yeah, that’s a good is that a big numbers add like a just about to what you need to start with to get some results? or?
Brent Bowers 31:02
Yeah, you can start with the list of 1000 General, I try and be at a 1% offer acceptance rate. We’re not always there with this whole COVID thing. A lot of people are buying land. So I’m kind of seeing like way, way less, I used to be able to send out 100 offer letters and get one one property. Now it’s somewhere around 200 to 250 letters to get one one deal under contract one property under contract. So 1000 letters, you know, I generally would try and buy five properties with 1000 letters as what my numbers have been left the last quarter. Last year, it was way easier to buy land than it was to sell it now it’s you know, it’s shifted a little bit. It’s been way easier to sell the land than it is to buy it. It’s just like houses, you know, buyers and sellers markets type things.
J Darrin Gross 31:56
No, I mean, there’s there’s a cycle to it. It sounds like so you you do then you should do your mailing daily.
Brent Bowers 32:04
Yeah, we generally mail daily. Right now we’re on 26 letters A day going out automatically. I’m trying out a new system. Howard Zander owns land speed. I’m we’re trying out land speed right now. So it’s like 26 letters a day? We’re not mailing on Sunday, obviously. So technically, what is that? 25 times five would be? One 125. So roughly were mailed about 150 a week, on average. So that’s, that’s 900 a month? Well, that would be three. Yeah, 900 letters A month? Is that what we’re mailing? So it’s it’s pretty crazy for the house guys out there. You have you know, you have to mail like five or 6000 letters to get a house land. We’re mailing so much less like our mailing expenses is so little.
J Darrin Gross 32:56
Yeah, it seems very manageable. And are you What’s your persistence? I mean, you just send one and one you’re done? Or do you have a follow up letter? Or is there any kind of a cycle, if you don’t hear from somebody to you to try again and reach out to them again, we’ll change it
Brent Bowers 33:12
up. So after they, if they do not accept our blind offer letter like to where we offer them an exact amount, will send a postcard, which is way cheaper than the letter. And we’ll get callers that call on that, that would never call on the offer letter, and vice versa. So we’ll change it up. And generally, we only mail list twice, we probably could mail it more. And it’s about every 12 weeks is our cycle, we could probably mail it a lot more often. But this this is very cyclical, too. So we’ll buy a bunch of properties. Or we’ll come across a land wholesaler. Yes, that is a thing. There are guys out there that get tons of properties in their inventory. And in wholesale to guys like me that want to seller finance it. Some guys just like to do the Quick, quick cash. So we’ll come across those guys from time to time and buy 117 parcels or four parcels or 11 parcels. So I love it because I didn’t have to mail those guys. So we’ll pause mail and from time to time, which I don’t recommend pausing very long because it’s nice to cherry pick land too, because sometimes, like we just got a property under contract for $16,000 that we’re buying in Colorado Springs, the comps are 115 115,000. So we’re buying the property for 16,000. And we’re going to sell or finance it for 115,000. Now, what’s the return on investment for that 115 divide that by 16,000. That’s like a 700% return on investment. And oh by the way, I’m gonna have a buyer lined up before we pay for it. So we use their cash, they’re gonna bring that $16,000 to the title company as their downpayment.
J Darrin Gross 35:00
An infinite he didn’t he I mean, there’s no no money,
Brent Bowers 35:03
that’s true, then it turns into infinite. That’s exactly right. Because I’m gonna use his down payment. And then I’m going to hold the deed of trust and the promissory note, he’s actually going to own that land. But I’m going to be the bank on Infinite return, because he’s going to pay for the land.
J Darrin Gross 35:19
Awesome. So let me ask you, somebody who’s listening, says this is what I want to do. What? How much time? would you encourage them to kind of budget to, you know, get this, I mean, you’ve had some initial success. But But to get a system to where you have this to where you can actually, you know, this is passive income, and you can live the life you want kind of thing, what are we talking about? What’s a realistic timeframe?
Brent Bowers 35:46
You know, why when I started out, now, I wish I would have just had this system from the very beginning, I was the guy buying I was the guy selling I was the guy collecting the payments, the cash, I would say, realistically, you could build a system like this in three, four months. Now you’re gonna have, you know, expect errors, expect, expect challenges and problems, like that’s what we’re if we expect that it’s not such a big deal. But, you know, someone can realistically have a system like this built in three months, easy. I just started coaching in June, I’ve had guys making passive income and roughly 30 days. Now, granted, as far as the time it took, for me, personally, I was an army officer, I was on base at 6am. And usually leaving base six or 7pm. Now, I may have taken my lunch hour a few times, few times a week, maybe five days a week to make calls, return calls to sellers. And then I would also, you know, post on craigslist and Facebook during my lunch hour. But I would say I probably spent about two hours a day, Monday through Friday, getting this off the ground. And I would say we’re always improving our systems, but it probably took me about six months to have have a system actually built. And then Luckily, I got an acquisition manager, that was a first thing I hired out, because I just couldn’t take the phone calls. And the second thing we hired out was the sales side of things.
J Darrin Gross 37:24
No, that’s, that’s awesome. I mean, you know, it’s exciting to have success. And relatively quick, I mean, I think about, you know, all these people I talked to and see their posts and stuff about how they’re working and work and work and work and work and work and work, work work and trying to find a deal. And, you know, the, in a lot of the commercial space specially like the multifamily, which I think is probably got interest had most of the buzz here for the last, you know, four or five years. There’s a lot of competition in there, you know, and if you’re, you know, you’re, you know, trying to get started, you you, you know, have to get to know the brokers, and then, you know, if you don’t have enough money yourself, you got to raise money, and you got to have all these other you know, connections or vantage points are just, there’s additional pieces to it. Yeah, this sounds to me, like, a guy could get started with almost a credit card, just from the standpoint of the low cost of entry from, from, you know, some of the size of the deals you’re talking about. It’s not like it’s, you know, a big I mean, obviously, it sounds like some of the deals, you’re, you know, $16,000 may be more than what what, you know, somebody might start with but, but you know, you’re talking 250 or $500 purchase points on some of these ones you start with that’s, that’s pretty attainable.
Brent Bowers 38:54
Yeah, absolutely. I mean, we’re doing bigger deals now. Because the way I look at it is we spend the same amount of time doing a bigger deal as we do one of those $300 deals. But yeah, you’re right, that was my initial attraction. I didn’t have you know, tons of money, I couldn’t go out there and make offers on houses or, or apartment complexes because, you know, it takes a lot of money and like the brokers have to believe in you. You know, what was cool as I was just dealing with everyday people that own the piece of land, and Me too, I was an everyday guy with, you know, a few hundred dollars or a few thousand dollars, and then I would just try and turn that money as fast as possible. I that was my initial attraction. It was like, Okay, I can do this. Like, this is easy, like you don’t need tons of money. And you know, eventually people will start finding out what you’re doing and will offer you money at five 6% interest or partner with you all day long. You know, there’s so many people out there with money that one To do something with it besides putting into the stock market besides buying a rental, like I did on my first one that netted me $150 a month, from 2007 to 2019, that something always broke. Like I was never profitable on that rental. But every one of my land deals I’ve been profitable on
J Darrin Gross 40:20
Oh, it’s, that’s awesome. No, it’s it’s definitely a another option and an asset class that anybody’s that’s looking for an opportunity. And, you know if this, this sounds appealing, I mean, clearly you’ve demonstrated that it’s, but it’s something that works. And you’re not alone, I may have talked to other people that that have had success and and I think one of the things you mentioned is lack of competition, although you did say COVID ramped up the the competition, but I’m assuming that’s not from people making a business out of it’s just an actual demand for buyers looking for for land is that
Brent Bowers 40:58
Yeah, demand for land. And I’ve noticed that on some of the the larger tracks because now we’re you know, like I said, people come to me with like 117 parcels, where I was selling those for 1900 dollars an acre, now selling those for $3,900 an acre. So it’s, it’s helped me on my sales, but also on noticing like these, these sellers, aren’t coming off of the property as easily. And I don’t, I can’t say that I’ve got my finger exactly on what it is. But I track my numbers, which is so important. Most people don’t do that. I know that I have to send at least, you know, 250 letters now when I could get away with it with 70 or 80 or 100. Before. Now granted, I’m not doing a sniper approach, as you know, three years back taxes out of state, it’s kind of on the general vacant land for certain areas. But yeah, I’ve seen the pickup and where I’ve had to mail more. So that’s kind of an indication to me, I, I try and run the business off of data. I have some students that say, I’ve mailed thousands of letters, and I haven’t gotten anything, and we break it down. And they’ve really only mailed 800 letters. And they’re offering too little, you know, that’s it’s tracking numbers, data, not drama.
J Darrin Gross 42:17
Yeah. Well, and that’s, that’s, that’s a system, right? I mean, if you’ve got, you know, what your input is you you know, what the output will be based on the system. And, you know, it’s interesting that just the the cycle that you’ve talked about that they call markets, there’s a cycle and and the longer you participate in any market, you’re going to experience the highs and lows of that so that that market, amen. So yeah, just gotta have kind of more of a longer view of it. But hey, Brent, if we could, I’d like to shift gears here for a second. As I mentioned to you, before we we started by day, I’m an insurance broker, and I work with my clients to assess risk can determine what to do with risk. There’s a couple of different strategies we typically consider. We look to see if we can avoid the risk. If we can’t avoid it, we look to see if there’s a way we can minimize the risk. And then if neither of those are an option, we look to see if we can transfer the risk. And that’s what an insurance policy is. It’s a risk transfer vehicle. I like to ask my guests if they can look at their own situation. This could be your clients, investors, tenants market, you you frame them the reference point. But with that if they can identify or if you can identify what you consider to be the biggest risk. And just again, for clarification, I’m not necessarily looking for insurance related answer. But if you are willing, I’d like to ask you, Brent Bowers, what is the biggest risk?
Brent Bowers 43:57
Yeah, I want to talk about a property we buy. It was late 2017. It was the last vacant parcel of land in a mobile home park. And it was from a lady her husband had died. And he was a builder. And he pretty much he went bankrupt. So long story short, we had to reactivate his his LLC to be able to take ownership of that piece of land. And we went through all these steps and I had a buyer already lined up for $16,000 that I found on Craigslist. So I had about $900 into reactivating this LLC back tax his lawn service fee from the city and paying the seller so the seller really only made like 200 bucks off of this parcel land. Well, when I had sold this parcel for 16 grand to another builder that was going to put a brand new modular home on that title company found out that there was $157,000 IRS tax lein on it. So I did not do my due diligence in the beginning and run, like owners and encumbrances or O & E is what we call it, or even a title search at that point, you know, I was kind of just shooting in the dark. So I was just, I was so sad because I mean 2000 beginning of 2018 at this point like that, that was life changing, like I had just had I had a brand new baby, first first child. And actually, no, that was my second child by then let me let me back up that second child. But that would have been game changer, you know, a profit of 15 grand basically. So what I did was I waited a year I cried a bunch now, continue refining my system continue buying land, but I never took that deed into my name. Like, I never took ownership of that. And this poor lady would call me and never return a call. She’s like, are you ever going to record that deed? Because I’m still receiving calls from the city and blah, blah, blah, I would just ignore because I was scared. I didn’t know what to do. $157,000 IRS tax lien I didn’t want to take on that I was like, Man that would bankrupt us from the very beginning. So long story short, I found a title company A year later, heritage title. They said, Listen, these things sometimes fall off, let’s figure it out. So they cleaned everything up. I still did not take ownership of this. But it was good to go. So like go ahead and sell it, you’re good. It’s dropped off. The IRS drops these things off every so many years. I don’t know how it works, just called dumb luck, or God blessed me I would say it was probably God, God’s blessing, which we you know, you get lucky. The more you do that, the more God bless you. Um, so long story short, I found another buyer I think this time was on Facebook marketplace or buy sell groups, but found another buyer for 35,000. So one year later this I got confidence in myself in my process. So I doubled the price basically, I also got $5,000 down, I only had 980 into the property. So I got $5,000 down and it’s a 52 and a half month term at 534 a month so I’m still getting $534 a month and I will be for another I think two two years two and a half years on this property but that’s the biggest risk not checking the chain of title making sure that if J Darrin Gross leaves this property to Brent Bowers and you leave out Jay we just broke the chain of title so that’s that’s one risk and two is doing your background your due diligence and your title search and making sure there’s no IRS tax liens or encumbrances or city liens. You name it. So there’s my risk story.
J Darrin Gross 47:49
No, that’s that’s awesome. The due diligence gotcha kind of thing. I think that’s really is the, you know, one of many opportunities for issues in real estate, but I think it’s it’s probably the, the one that you have most control over if you do your due diligence. And it sounds like it all worked out for you. You found you found a solution in the process. So that’s Yeah,
Brent Bowers 48:12
thank God, man.
J Darrin Gross 48:14
That’s awesome. Hey, Brent, where can listeners go if they would like to learn more or connect with you?
Brent Bowers 48:21
Thanks so much for asking. Yeah. So like I said, I’ve been coaching students since June, I do have a course. One on one coaching, support calls, go to thelandsharks.com I’ll spell it out. Thelandsharks.com. The land sharks dot com. Schedule a call with me. I’d love to jump on the phone. And if there’s any questions I can answer. This is what I do now.
I love it.
J Darrin Gross 48:53
Awesome. Well, it’ll be listed in the show notes. And Brent, I just want to say thanks for taking the time to talk. I’ve enjoyed it. I’ve learned a lot and I look forward to doing it again soon.
Brent Bowers 49:07
My pleasure. Darrin, thanks so much for having me on the CRE PN Radio.
J Darrin Gross 49:13
Right. And for our listeners, if you liked this episode, don’t forget to like, share and subscribe. Remember, the more you know, the more you grow? That’s all we’ve got this week. Until next time, thanks for listening to Commercial Real Estate Pro Networks CRE PN Radio.
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