Joe:   Hey, what's going on, guys? Joe McCall, the Real Estate Investing Mastery Podcast. Really glad you're here. Guess what? Today we're going to be talking about my favorite subject, Vacant land in investing. And I got a friend named Michael Poggi. And this is a very active investor who's been in the business a long time. Very, very long time. And he's got some really cool, amazing stories to tell. He is in this special niche of making money on little quarter acre infill, lots in subdivisions and HOA fees and building long term wealth and cash flow tax free done for you with vacant land. It's really amazing. And I, like Michael. We've met a long time ago, but we hung out about how long and I'll ask Michael in a minute here when I bring him on. But in Tampa, maybe 2 or 3 months ago and really dug deep into what he's doing, and I thought, hey, listen, can I just get you on my show and we can talk about it, introduce you to my audience, because I think there's something really valuable and I want you guys to listen to and learn from Michael not only how to do business with him, but how to grow your own passive income or long term appreciation. With vacant land in some of the lots that most people say I don't want to do anything with, right? Michael found a way to make money with that. I think we should just bring him on right now, shouldn't we? What's up, Michael? How are you?

Michael:  Hey. Hello, Joe. Thank you so much for having me on today.

Joe:   I'm glad you're here. Glad you're here. You're in Florida. Where in Florida?

Michael:  South Florida, near Fort Lauderdale, about ten minutes west of Fort Lauderdale. My wife and I have two young children, and we live on an acre with a whole lot of zoo animals here. And we just love our life here. And we have so much passive income and freedom that we do quite a bit of traveling and enjoying our the fruits of our labor.

Joe:   Yeah. So I've seen videos and pictures of these animals that you have and it's only one acre. That's how you. What you've done there is amazing.

Michael:  Thank you. Thank you.

Joe:   Okay, so I want to ask you questions about the zoo and the animals that you have. That's not why people are here. Let's talk about you've been in the business a long time, since the 80s. 90s.

Michael:  45 years.

Joe:   Okay. Nice. And how did you get started in real estate?

Michael:  Well, I was a stockbroker in Chicago at the Young man, and I learned from my clients. My wealthy clients told me that they had 95% of their money in real estate and only 5% of their money in stock. Sowhen they would send me money to trade their stock portfolio, they would send me $1 million. But they had 10 million in real estate and I couldn't figure out why. So finally I got to know them very well, became friends with many of the successful client of mine, and they showed me that they make way more money from everything from brick land to new construction to flipping to apartment buildings, you name it. And that caused me to sell my stock brokerage firm and move to Florida and start to invest in real estate myself.

Joe:   So this is early, 2000s.

Michael:  Long before that, even as a stockbroker, it was even before 2000. So I was just practicing with real estate. Probably just before 2000. Yeah.

Joe:   Okay, cool. And then what got you interested in vacant land? And specifically, we'll talk in a minute about what you're doing in Arkansas.

Michael:  It was kind of cause I didn't have any choice. I didn't have 100 grand to do a fix and flip, and I didn't have the experience or the knowledge, so I had to start somewhere. So all I had was $500 when I started in this business with 500. But that's pretty tough. Become a multi multimillionaire from starting off with 500. But what I did was I had $500 in my self-directed Roth IRA, so therefore I could use that for real estate. And what I did was I ended up calling many sellers that owned a vacant lot in resort community. And I would ask them, I say, Hey, listen, I see your lots for sale for five grand. And again, that was 20 some, 45 years ago. And I would say to them, look, I don't have five grand, but if I give you $500 down, can I please make your payment for five years? And at the end of five years, you can then give me the deed. So this way you have no risk. And many of them said no, they want the money right now. But some of them said, Yeah, you know what, I will take you up on that, because if I sell it for cash right now, I'm going to have a big capital gains tax and I would rather spread it out over the five years. So it worked out great. So one older gentleman gave me a break, my first lucky break, and I put 500 bucks down in my Roth IRA and I paid my payments on time every month. And at the end of five years, the lot had doubled. So it went from 5000 to 10,000. So I said, Wow, that return on my money is quite good, especially when I didn't use much of my own money, only $500 down payment. So I was able to control 5000 with $500, which is leverage, which you can't do in mutual funds. You can't do that in stock. So when I when I learned that block the B, I thought to myself, wow, this is pretty cool. Maybe I can do this over and over again. So what happened was I put that locked. Fill a ten grand and instead of saying $500 down or thousand down or 20% down. I put different words in my ad, I said zero down payment, 100% financing, no credit check. Everyone approved. And I got 80 phone calls in two weeks. Just for one lot. Now, if I had 40 or 50 lots, I probably would have sold them all on terms. So I didn't realize how good I had it. So I ended up selling that lot on terms and I made another 10% return on my money for additional five more years. So not only did I make a double, which is 100% return, which equals 20% a year approximately, but I also made another 10% more per year, all in my self-directed Roth IRA, which we call a real estate IRA. That's not a Schwab and it's not a Bank of America. It's with an administrator. So when I did that, all of a sudden I realized that I've got a good system I can buy in terms I can sell long term and make a shitload of money using other people's money, meaning the seller. So, yeah, IRA paid me on time. Every month you'll be paying me every time. Every month on time. And I went ahead and then started to do it on a bigger scale. So I still didn't have much more money in my diary at the time. So what I did was I borrowed $20,000 from my brother, which allowed me to put $500 down on 40 vacant lots. So now I'm controlling 40 in my IRA instead of just 1 or 2.

Joe:   And let's rewind a little bit. For people who don't understand what a self-directed IRA is or the benefits of that. This is basically a tax deferred account, right?

Michael:  It's a tax free account.

Joe:   Tax free accounts. You've already paid taxes on that $500 you had in there. Any profits and any gains you don't pay taxes on ever again.

Michael:  Not only the gains, but even the income interest. So as people were paying the payments of $500 a month from one lot, every single penny that came into my IRA was tax free. So the profit plus the interest together accelerated my IRA exponential rate so fast that it got into the half a million and million and 2 million and so on, just from doing the same thing, duplicating that system over and over and over again.

Joe:   Right. And you can't the thing that's important to remember, if you don't know this, guys, is that money has to stay in there, Right? You can use it to pay for expenses to manage and sell the property, but you can't use that money until you're 65 or 70, whatever.

Michael:  59.5.

Joe:   59.5. Yes, sir. Sounds like a good plan to me, right? All right. So you started doing you got you borrowed some money from a friend through the self-directed IRA. You bought a bunch of properties and then you sold them on terms. So go ahead and finish your story there.

Michael:  Yeah. So I end up borrowing 20 grand from my brother. And then I went ahead and called many sellers and I said the same thing. Listen, I've got $5 down. Can I buy your lot for five grand? And I did that over and over and over again. It's like I finally found 40 sellers that would agree to that. So that means that I was making 40 payments a month on time without fail in order to do that without defaulting. I did some other things. I certainly had a business. I had some fix and flips, I had some new construction houses. So I took that profit and was able to go ahead and use that to make payments for the vacant lot so that I never default.

Joe:   Well, you also were selling them an owner financing, right? So you were getting some payments, cash flow in from selling those lots, right?

Michael:  Well, when I acquired those 40 at that time, they weren't up yet. So I didn't I didn't sell the 40 lots until they went up. So when they double broke, buy it again. I waited five years. So they did like double play in public, which means I made 20% a year return, which is very high compared to typical stocks, bonds, bond annuities and stuff like gold and silver for that matter.

Joe:   Okay, so you had to find a way to make payments to the to the owners, the sellers?

Michael:  Yes, sir.

Joe:   During that time, while you waited until the properties appreciated.

Michael:  All right. You nailed it.

Joe:   Okay, cool. On average, what was your payment to the seller each month?

Michael:  Well, I was able to negotiate sometimes zero interest, which, you know, some of them said, Yeah, just make me a payment and you pay me my full price. I'm asking I'll do it at zero interest. So with my good negotiating skill, I was able to get sometimes zero interest or 4% interest or 6% interest when make payments were usually a couple hundred dollars a month very low. And then if I wanted to, I could pay them off early. So I had no prepayment penalty. And then also, if I wanted to, I can just request a balloon payment at the end of five years. So rather than have a happy payment, I could structure or my payments were low enough. But the balance that was due was due at the very end upon the last payment, which made it easy for me because by that time I could put a sale and find a buyer.

Joe:   Yeah. And just so people know too, if you would have had more money in your IRA, you could have been making those monthly payments from your IRA, right?

Michael:  Well, I was making them from the IRA. I did all the other real estate transactions in the IRA so that I was able to have the money in there. So I would do a fixed split in my IRA. I would do a new construction house and my IRA. Things like that, apartment buildings. And that gave me enough profit that I never had to worry about missing any payment.

Joe:   Okay. Now, some people are asking, why didn't you just sell them right away on owner financing? Why did you wait five years for the price to go up?

Michael:  And that's actually one of my biggest mistakes with selling them too soon, even five years later was too soon. Here's what I mean. If I sell a lot on terms, I'm going to collect probably between 10 and 12%, somewhere around or maybe even 15 if I'm lucky. But 10 or 12% is what I would collect in interest. But the lots went up 20% a year. So if I hold them, I make more return. If I follow too soon, I do a penalty. But rather than have cash flow now, I would rather have more profit later. So by holding a lot longer term, I would be able to make way more money. So one. So, so one of the things that I learned was that the second time I tried this was in a resort community. This is where now I was actually buying what's that? And real good value to the next person because there was lakes and golf courses in there. And what I did was I bought many, many lots in Texas at ten grand in a subdivision that had lakes and golf courses, a true resort community. And those like double after five years, they doubled to ten grand. I'm sorry to double the 20 grand. And I went ahead and sold the land terms. And I thought that was pretty smart. But guess what? Now, those same lot are $65,000. So I had I held them. I would have made way more money instead of the interest that I made. So I like holding land long term. Now, if you're one of those people that needs short term cash flow right now, then, yeah, you should sell them right away, which we can do that for you. Our company actually is all turnkey. In other words, we do that for our customers where we find a loss for them. We sell them loss for them so they have passive income and cash flow. So we do it all turnkey. Okay.

Joe:   All right. So talk about then the next step of your journey. What did you start doing after you were buying these lots?

Michael:  We ended up collecting all that passive income from several hundred lots in my Roth IRA, which built my portfolio into the multi million. And since I wanted paying any taxes, Joe, that means that every time I took a profit or collected interest tax free, I got to reinvest all of that money. So it accelerated my wealth so fast that if I would have done the exact same transactions in my LLC or my name, it would have been several million dollars less than we calculated that with my accountant after we did all the transactions. So what I learned was that the more I can do tax free, the faster I can build my well. It doesn't mean that I didn't do some in my LLC. I did many of them in my LLC, but I got to use that money for vacations, hours, payments on Christmas presents, etc..So what I want to think about was that the income that I made coming into the IRA was been reused to buy more locks to get into the 500 lots and 700 lots. So I probably sold over 3000 lots in the last 25 years. And if someone has the ability to hold the lot, they're going to probably make more money because of how fast they are going up, because of all the construction going on in the resorts that I invest in. But you know, what's interesting is that most people don't realize, Joe, that they can use their IRA at Schwab or Fidelity or Bank of America and roll it over, which is not taking it out with a penalty. It's just moving it and using a self-directed IRA at an administrator. But even better, you can use your old 4k plan and roll that over into a new self-directed Roth IRA, a real estate IRA or one more secret that you can use your current 41K plan. And most people don't know that. They think, Well, am I a key player where I work? I'm stuck with it until I quit or I, God forbid, get fired. But actually, you're for one K plan where you currently work can be used to borrow against it. So if you have 100 grand, let's say in a four with triple-A where you work, you can borrow up to $50,000 to use for vacant lots, just like many of my clients did. So many of them borrowed money from their 4k plan they invested in vacant lot. Some of them still hold them today and they're up double, triple, quadruple from 5 or 10 years ago. It's amazing.

Joe:   Okay, cool. I love it. So talk about what are the advantages of investing in vacant land versus investing in a house or a multifamily, a syndication or something like that?

Michael:  Yeah, great question, Joe. And I know that you know this answer, but I appreciate you. Let me tell you because you know this just as well as I do. You're an expert at this, too.

Joe:   I'm laying it up for you.

Michael:  I know you are. I know you are. So, you know, when you think about it, you can have a tenant in a house and paying rent, which means that now you have to manage the tenant, you have upkeep, you have repairs, maintenance, taxes, insurance, all kinds of aggravation. Or you can be a landlord of land like I am. I'm a landlord of land. That means that I've got someone making me payments on vacant lot with no headache as in I don't get any phone call. There's nothing to do. There's no repairs or domain. And it's so simple. And I actually collect hundreds of incoming payments every month on auto. That means that on the first of the month of the people come in and make me make payments into my Roth IRA tax free. And all I got to do is once a month check to make sure all the payments were received. The chances of someone defaulting go are almost zero. Here's why. When someone buys a lot from you and is making you payments, they don't get the deed from you until they beat your last payment. That means that you have the deed and control of that piece of land. So if someone were to default, there is no foreclosure. It's just simply sending them a notice of default. If they don't cure the default. Then you can take that same lot and reached out to someone else without having to go through any foreclosure. So people know that they don't want to lose their deposit and they don't want to lose the payments they made to you. So they default. So it's a very safe lending program, so to speak.

Joe:   Yeah. And even if you had to foreclose on it. What's the big deal with that anyway? If you had to go through a foreclosure process, think.

Michael:  For 500 bucks, I would guess, to foreclose. But again, it's not necessary. Just think about it like an automobile loan, Joe. If you go to buy a car and you put out ten grand without a car and you borrow 40 grand from the dealer, you will the dealer 40 Grant Well, you don't have the car title and you don't get the car title until you make your last payment. That means that the car is really not yours until you make your last payment to the dealership. The dealership is going to be sure that you make your payments. If not, they come and take the car. So I still think applying to this is just like selling cars on terms, but it's selling big it lots on tour. Now, I have specific criteria, Joe, that I love to share with you guys, if that's okay. Let's do something else first.

Joe:   Yeah, no, this is good. I have some more questions, but I want to see your criteria. Yeah.

Michael:  Yeah. So after all the years of making mistakes from 25 years ago, I first was buying lots in Florida, like Punta Gorda, Lehigh Acres, Fort Myers, Cape Coral. And everywhere I could find a good lot near me where I live. And that wasn't the smartest thing to do. It doesn't mean that I didn't make money. I did. But the best choices were not where I live. So I don't want to invest where I live because I have to be close to it. I don't need to see the lot. I can see it on Google Earth. I don't need to go walk the lot. If I do, I just fly there and look at it. So my criteria is that it must be in a resort community with more than one lake, more than one golf course and lots of amenities, and only 10% built out or less, because if it's 90% built out, then the prices are too high. If it's 0% built out, then it's too soon. And there's no houses, no infrastructure, no Walgreens, no Walmart, no schools, no bank. So it must meet all of my criteria. And some of that include under 20 grand. So I never buy a lot above 20 grand. It has to be, let's say, 15 to 20,000 somewhere in there. It must be buildable. So it has to be at least a quarter acre. I don't buy five acres unless I'm going to build houses on them. I don't buy ten acres or 50 acres. None of that is easy to sell. So instead I only buy lot that are easy to resell, not only because they're cheap to buy and a record breaker, but also cheap to sell. So the next person to afford it. So I'm buying them all. In resorts under 20 grand, less than 10% built out. They must have low taxes. Like, for example, I only pay 60 bucks a year. We're in Florida. I was paying 250 a year. We must have low cost of living. They must have good schools, churches, good banks, Walmarts, pharmacy. Everything needs to be there in place. And there must be lots of permits getting people to build houses. So this is an area where there's no activity. Joe I'm not going to go in there hoping that one day builders start building in there. There must be permits being pulled by the thousands. And if I see that, then from my data, from my research, then I know that subdivision has got to be one of my best choices. Does that make sense?

Joe:   Yeah. Okay. Interesting. So you. It's got to be buildable. Lot needs to be under 20. Is that what you said?

Michael:  Yup. 20 grand is my maximum purchase price.

Joe:   And there can't be more than 10% of the lot sold in this community.

Michael:  Not sold. Built. You have to be left with 10% of the house is constructed. And I don't buy any lot on a lake or golf course. Number one, because they're too expensive. For example, if I buy a lot on the lake for 100 grand and I have to sell it at 200 grand, it's hard to find buyers at 200 grand because there's very few of them. But if I buy a lot of ten grand, for example, and sold it at 20 grand, there are some way more buyers that can afford the $20,000 lot from you guys. Then take $200,000 lot so it sells faster, which means now you can reuse the money from your Roth IRA quicker and turn it and do it again. So it's like six months or less for a $20,000 lot rather than two and a half years for a $200,000 lot. So I never buy expensive block anymore, even though I did make some money on the lake lots and golf course when I practice. I realized, though, that the time that it took to sell them was much longer than I made my product.

Joe:   So you're looking for you're looking for where they're actually pulling permits and building new.

Michael:  Very fast, though it must be a very fast growing area. Otherwise we will make money in our lifetime. I want it to be where the lots will appreciate because there is homes going up all around the subdivision and forcing the values up from construction going on. There is no construction going on. The locks will stay the same. There's no reason for them to appreciate.

Joe:   So I'd imagine there's not a whole lot of communities like this in the U.S.. Or is there.

Michael:  Only a handful and I had to pay a lot of money to have research done. When I first started to find me the fastest growing subdivisions in America. And so what happened was that when I paid for all this research, it was close to 10 grand in research. And it brought me all the data that I needed. Meaning to meet all of the criteria I just told you. Meaning, is there a lot of permits being pulled? Are they already cut up into quarter acre? I don't want to buy a piece of land. Cut it all up. That's a lot of problems. So I wanted in-fill lots. Like you mentioned from the beginning. Joe, You nailed it. Infill lots so I could buy that. Where it's not buying from a builder. I'm not buying from any developer. I'm buying one lot at a time from a seller who was not for sale. I also never buy off the on the left to be on the left hand sellers who either have a lack of leads, meaning they didn't pay their taxes, they didn't pay their fees or something. Or maybe the lot isn't really a billable lot. So I stop buying from me on the left. Instead, I send out thousands of offers to the sellers that are not for sale. And I say, Hey, I'll buy your lot and I will try to get it dirt cheap because I would probably never get that many lots if I try to offer too low. So I offer close to retail because I want the lot. I don't care if I buy it at full price. It's going to go up in a year anyway. So instead of buying a lot for half the price and having to fight with sellers every day, trying to turn down a lot, that they won't give me a break, I'll buy even if I have to at retail or close to retail if I have to, because I want the inventory being in real estate. That's how you make money. Not being in real estate is how you don't make money. So the key is to be in the game at all as much real estate as possible. Just like the Monopoly game, the same thing. How much real estate can you control so that when you are ready to retire, you have exit strategies to sell lot of terms or to sell them for cash or whatever you choose.

Joe:   That's fascinating because you are you're now trying to buy land because you have a long term outlook, right? You're okay with buying land at closer to today's value, is that right?

Michael:  Yes, sir. And the reason why is that if I'm making offers and having to fight with sellers to try to save a couple thousand dollars, it's not worth it. Our time is more valuable. And if I decide a lot worth that, then I get it. If not, I lose good deals by trying to negotiate with sellers too much. So I try to offer right below market value so that I can actually get some loss. Otherwise I don't want to just get 1 or 2. I want to get ten, 20, 30, 40, 50 loss every single month. So I'm actually sending out thousands of offers at a time in order to get the life that I want for me and also any of my clients that have said, Michael, I want to hire you. I want you to buy my lot. I want you to inspect them for me. I want you to take pictures. I want you to walk the lot. So I have a team of people in place that handle all of that from walking a lot, you know, taking photos with me. Everything that is all done for you. Turnkey.

Joe:   Yeah, well, that makes sense. Okay, So you're you have in your business right now, you have your own land, but you're also helping other people find land for themselves, right?

Michael:  My own life or for my children. When I pass away, I'm already successful enough to not have to work. So I'm building my legacy and I'm also building on it to open up a giant rock, you know, Drive-thru zoo. So my goal is to help more animals and save species from extinction. So one of the things we do now, Joe, with the animals, we rescue a lot of rare animals. We rescue lemurs, we rescue monkeys, capuchin monkeys, our multi squirrel monkeys, things like that. So we rescue a lot of animals, which is my passion. So my passion is to help animals and also to leave a big legacy for my children who are only three years old and five years old. So when I pass away, they're going to inherit well over a thousand a lot by the time I pass.

Joe:   Nice. Nice. Okay, cool. So talk a little bit about what you do for people who are looking at this thinking, Yeah, you know, that sounds awesome. Like, how do I find this land? How do I buy it? Do you teach them how to do it themselves or do you just do it for them? How does that work?

Michael:  Because if I were to interview 100 people and if I were to say to 100 people, Hey, would you like to learn all of my system and do yourself and buy a course, or would you like me to do it for you? Since I'm an expert and charge a small fee to help you out and 99 out of 100 people say, Mike, you do it, I'm busy, I've got a business or I've got a job or I've got family and I will have time to not only learn all of that, but your mistakes that I've made over the years, they don't have time to learn all of that and they would rather have a done for you program and not by the. Course. So that's how my program turned into done for you. It used to be a course for sale, and all of my students said, Michael, this is amazing, but you're so good at it. Why don't you do it for me and I'll pay you $1,000 per lot? Sure enough, that's how it turned into a Done for You program, where now we provide lots for builders and for investors that want to buy lots in a fast growing resort community.

Joe:   Nice. Awesome. Okay, so then talk about what it is that you do. Let's say you know somebody you get on the phone with somebody and they're interested. What do you walk them through? What are the steps?

Michael:  The process is for them to get to know me better. And so obviously that they don't know me, they don't trust me. So we have to establish some at least some kind of trust so they know my credibility and my credentials. They can see that my books are online on Amazon, things like that. But then the next step would be to really take them through the subdivision and show them what the subdivision looks like, show them the lake, show them the golf courses, show them be vacant lot, show them the appreciation over the last ten, 20 years and all that done typically on a webinar where I can zoom in on Google Earth showing what the subdivision looks like, I could show comparable prices. That shows that the lots are selling for higher than what I sell them for so that people know they're at least buying at the market or below the market. They like that it once someone feels comfortable, they would then just place an order. They would say, Michael, I'd like to roll over my IRA from Schwab or Fidelity or Bank of America to a self-directed IRA and use 100 grand for loss or 500 grand for loss of two or grand for a lot. And then we would end up bundled loss, which takes about 2 to 4 weeks. I don't keep them in inventory. I have my own locked in them in theory, but I don't keep my new customers. What's an inventory? What someone says, Yes, I'll take some, whether it's one lot or ten lots, whatever it is, that's when we go out, start the process. We let our team know to start the process of making offers, negotiate with sellers, walk the properties, check for lean, take photos, then I'll contract for the sellers. If the lot passes all of my criteria, then we buy, we'll take an inventory and the following day it gets sold to an investor immediately out of basically a simultaneous call. So then one day I buy it for the customer who ordered them. The next day they're going into their IRA for their old four week plan that moved to an IRA, or they're going into their LLC or their name or whatever they want, so people don't have the money to buy a lot. They're running between 16 and 20,000 right now. So if they don't have the money to buy a lot or several lots, we finance them again. We will help them by letting them put a small down payment down and make payments from their IRA or from their LLC, whatever it is. But we help pretty much everybody.

Joe:   All right. So let's talk about some example numbers on a one of these deals. Can we. Yeah. So what are you what are you buying them for or what is the end client buying them.

Michael:  For cost After everything from the mailers to the cost of having someone walk the lot who lives there to paying for lean searches. And even though sometimes we find a lot that we do a lean search that we pay for, but the leads are too high and we don't buy the lot. So we have lean searches that don't ever, don't ever go for a lot that we're buying. We have take we take all the photos, we print all the math. So our cost right now is about 15 or 16,000 right now. Now once now that might be 17 or 18,000, but currently right around 16 or 17,000. And every 3 or 4 months we have to raise our buy price to the sellers in order to be able to get them. Otherwise, if we don't raise our buy price, then we can go and say yes. So every 3 or 4 months we raise our buy price by 500 bucks to a thousand bucks, which now speed up the process of actually getting some good lot when the lights come in and they pass all my criteria, we send them to the investor in an email saying, here's lot number one, check it out. Here's line number two. Check it out. And they see the lot. They see the pictures, the maps and all the photos. And then all they do is they okay. Sounds good. I like them, but close. So we pulled the following day by doing wire transfers and then the beach transfer into that person's name or their I.R.A..So if the Irene has the money in it, then the IRA owns the lot and the Deeds would be title in the IRA with the client at the beneficiary.

Joe:   So yeah, cool. You're only marking it up a little bit for, for each of these lots but you're doing a lot of the work.

Michael:  Doing high volume that's all. So there's plenty of money to be made if we just, you know, just not be greedy, take a little bit of profit on each lot, but do a lot of business and a lot of clients will buy five lots or seven lots and they come back and buy another five or they'll give refers to their wife or their husband or their brother or sister or neighbor or a friend. So we continuously get referrals from people that say, Hey, I really appreciate your help. I want to do this for my son and my daughter. I want to set up an IRA for my son. I want to stop an IRA for my daughter so anybody, any kid own they can like. And when you think about it, what would you rather give your kids when you pass away or grandkids, for that matter? Would you rather give those stocks and mutual funds that have high risk and very low upside or give them back at life like real estate that is lower risk and had the ability to be sold on par for passive income. You can't sell your mutual funds on terms or your stock. You're stuck selling them for cash. No other choice.

Joe:   Can you talk about the, you know, some of these communities? You know, there's a lot of variation. But what makes a good lot and what makes a bad lot, Right? Because, you know, these are subdivisions, I'm assuming, with hundreds if not thousands of vacant lots there. Right. So what makes a good lot?

Michael:  So let me talk about what makes a bad lot first. A bad lot would be one that is not buildable and that could be smaller than point two, 5.25 or the quarter acre. So if it's .21 turn up, it's almost a yes, I want to sell it, but we look at it with the no, it's too small. So we don't take any lot below .25, which is a quarter acre. Second thing is that maybe they're called the high tension wires or a power plant or something of that sort, you know what I mean? So we don't take any of those. And there's quite a few. I mean, there's obviously electrical lines running through every subdivision in America, so we don't pick any of those lot. We turn them down. So when the teller is there. Yeah, I'll tell you my lot they'll like that might be cheaper because it's next to high tension wires. You know, to me it might be eight or 9 or 10 grand so we don't take them. The other thing is that maybe there's too many leaves on the property, so the property is for sale and it's a good lot. It's buildable big enough, not next to high tension wires, but the seller owes $5,000 in back taxes or $5,000 in fees, which is property owners, association fees or both. Or maybe there's a mortgage on there from a divorce. We pass up that lot also. But guess what? We paid for lean searches on all of those blocks. We pay for lean searches on lots that we don't know if there is lean it till we find out that there's Lean. We don't know any better. If the leans are too much, we lose the lean search payment. That's an expense that we have to pay for, right? Yeah. So now what does a good lot point to? Five are bigger, so it could be point three. 1.36 doesn't matter anywhere between a quarter acre and an acre. They all sell for around the same price of the between 15 and 30,000 somewhere in there. And we want to make sure that the lot is buildable. So, for example, even though all of the lots or slope where I invest it because it's in the mountains, there's little grass, the mole, which saved me 70 bucks every two weeks, and it doesn't matter if it slopes up or down or not because the builders in there build on all slopes. It's a matter of fact. The lake lot are the steepest block. The lake was where you build the house. It's on such a steep slope that the get down to your boat house. You got to walk down a set of stairs facing straight down. And then so from your patio on your house, you're looking down at the top of your boathouse. You see the roof of your boat. Now those are all very steep. But all of the executives who live in there that live on the lakes and golf courses build on slopes. So slopes are no problem. There are no flat lots in the in the resorts that I invest in. So different been Florida by far.

Joe:   Yeah. Yeah. So some of these communities you know what I've looked at them you'll see lots that are for sale for 9 thousand and 50 thousand like so why are some of those lots for sale for cheap and some of them for sale for so much more?

Michael:  50,000, maybe sewer and water and a maybe over an acre or maybe closer to the lake like right across the street from the lake or right across the golf course. That's very possible. But the other thing is that if someone wanted to find a lot for, you know, nine, 10 or 12,000, they probably could do so. But they need to hop on an airplane, which is 400 bucks. They need to fly to all of this stuff. They need to rent, they hotel for whatever how much a night they need to rent the car. They need to drive to the subdivision for at least 2 or 3 days. They need to look at lots for sale. They need to make offers to multiple sellers to buy one that will sell the lot and so on. Then they have to pay for a lien search to make sure there's no liens, otherwise they could wind up finding a lot that has three or 4 or 5000 in liens. Then they have to send that contract to the seller. They have to then pay for the closing costs. And all of that time they get done the same price on that, minus my small firm. So it's no different. So if somebody wants to do it themselves to fiddle around with 1 or 2 lot, then they should just go ahead and do them. So they wouldn't need my help. If someone wants to consider it like myself because they're busy, maybe they're a veterinarian. They do. They're a dentist. Maybe they have a full time job. They're not going to want to do all of that. So basically we're providing a service that I do for myself. I'm finding myself and my family and my friends. I might as well do it for you. Simple as that.

Joe:   I like it. Okay, one more question. I wrap it up here. Do you find that in the past, has the housing market, has land kind of followed the housing market? You know, when houses are going up or down.

Michael:  It's actually not quite correlated. I'll give you an example. If the housing market takes a big dump and houses drop by 30% or 50%. Cheap. Vacant lot. Older value. And they kind of stay the same. So, for example, all during Covid, when there was no construction going on, my vacant lot in my resorts didn't go down any, but they didn't go up at all. So for three years I had no appreciation. But then when Covid was over and all the builders all around, Powell started to hire their subcontractors and then start to submit permit and then start to gear up and started to start building again. All of a sudden, that caused a frenzy of not only builders, but investors fighting over the loss, which forced them up. And we doubled since Covid. So in the last two and a half years, even though they sat for three years and did nothing, now in the last two and a half years, they went from about 8000 for a good lot to right around 16 to 20,000 for a good lot. So they doubled just as Covid was over. So typically I average about 20% a year. Even during slow times, if you average the full time, what's the best time? I averaged around 20% a year by holding down by holding the lot.

Joe:   I love the fact that you're doing it done for you. And you know, somebody even listening to this, you know, you can take what Michael's doing and you duplicate it in different markets and you in there's markets like this all over the country. But that's cool. Michael, I know there's a lot of people looking at this thinking, that's awesome that you do all of that. I don't want to do it myself. How can I get a hold of you? How can you do it for me?

Michael:  Sure. So I don't know if you're able to put something in the chat where they can see it, but it's solid. Yeah. My calendar is Meet with Michael Poggi.com. But also I have a webinar right now that runs every Tuesday evening from 7 p.m. Eastern time to 830. And I want to have it's like a workshop and we actually showcase that subdivision and we talk about IRAs and 401k plans. And in order to get on that webinar, they would simply register by going to w wwdot build wealth with land.com, build wealth with land.com, which is a hour and a half webinar every Tuesday evening from 7 p.m. to 830 Eastern time. And I'll be on the call. I actually go on and introduce myself to all of the investors that are coming in. And then we go through IRAs. Well, the plan vacant lot in the resort that I do. So by the time we finish with that, you'll pretty much know 90% of what you need. And then the follow up. You're welcome to hop on my calendar for that consultation where we can then look at your specific situation. Like what do you have in stocks? What do you have in mutual funds? What do you have an IRA portfolio? K plans whether they're new or look K plans all one and or LLC money or cash. We go through all of that similar to a financial planner. But consider me a financial planner for real estate. I'm an expert at stocks and mutual funds because I did it for so many years in Chicago. But I'm also a super expert in investing in real estate. And that's where we would talk about your personal goals. Are you look at for short term passive income or you look at for long term growth. What we decided that we put together a plan for you and we execute it based on your comfort level. Very simple.

Joe:   Build wealth with land.com. I have it on the screen there and then Meet with Michael Poggi.com. All right I'm sorry about that I asked you earlier correct way and I screwed it up but hey Michael thank you so much for taking the time to be on my podcast. I appreciate you.

Michael:  Yeah, thank you. I appreciate your questions, too. You know exactly what to ask. Thank you.

Joe:   All right, guys, We'll see you all later. Take care, everybody. Bye bye.