Joe:  Welcome. This is the Real Estate Investing Mastery Podcast.

Joe:  All right, welcome everybody, Joe McCall here. There's some things I wanna talk about because I'm seeing some people, not a lot, but some people really struggle in this land investing game. These mistakes I'm gonna be talking about for you today are the things that you need to be focusing on. You gotta understand something here. We are not in the real estate investing business. We're not in land investing business, we're not in the wholesaling business. What business are we in? We're in the marketing business.

Somistake number one, stopping your marketing too early. How many of you, let me ask you, have sent some mail in the past, but you stopped. Or you made a few calls and you thought, man, this just doesn't work. I want you guys to start thinking of marketing as an investment instead of an expense. That makes sense?So I told you before, I did 58 deals in a 12 month period. 93% of those deals came from follow-up, came from three to four months of marketing. It came after seven to eight touches. We just got a call a week ago in one of our markets that we're in from a seller that kept our letter for three years. Three years. And then she called us and said, hey, I decided I want to sell my property now, are you still interested? Do you think that maybe because we're still in the game that we got that call, it came in? If we would have quit, would have been a deal that we lost or she would have never been able to get us. Consistency is the most important key in this business. You've got to be consistently doing the marketing, okay? You've gotta keep the momentum going. If you're just dabbling, you're like, I'm just gonna try this for a month and see if it works and if it doesn't, I'm gonna quit and do something else. Don't even start. You've got to be committed to do this for at least three to six months of continuous marketing without stopping consistently, not a 30-day test. This consistency will compound over time. Pros, when it gets difficult, professionals will double down and do more marketing. Amateurs will quit.

Mistake number two, being inconsistent with your marketing. You send mail one month and then you stop the next month. And then you do it the next month after that. You sent it and then, you stop. You make calls for a week and then you stop making any calls. You're on again, you're off again. It eliminates all of your Kind of related to what I was talking about before being consistent without slowing down without stopping you need to do what I call Setting it and forgetting it and sometimes like it's too much you want to do all of this stuff all this marketing every day But you're too busy life gets in the way and you just can't do it all yourself You need to automate your marketing cadence with virtual assistants or done-for-you services or something like that And I like to call this marketing done for you in spite of you. It can be a software. It can be a mail house. It could be, you know, you're hiring VAs to do cold calling for you or whatever. But it's something that consistently is getting done all the time. And automation can solve this. That was mistake number two, kind of related to number one.

The other big mistake that I see, giving up too early after a no from a seller or after rejection. This is huge. You do the market. Okay, Joe, I'm doing the market, I am getting the leads. It's all coming in. But like, I've talked to 20 sellers and they've all said no. I've made 20 offers and they have all said No, you cannot give up too early after a no. No means not yet. You need to make sure you're following up consistently with these sellers. I can't tell you how many times I've sent an offer three times to the sellers or more. And they finally call me back and say, yeah, I got your offer. I said, oh, great, you know, did you get the other offers I sent? No, this is the first time I've gotten your offer? Well, I don't know what happened. They might have gotten it before, maybe they threw it away, but they got that fourth offer that I sent or the third offer that they sent. They're finally ready. They're like, yep, okay. I'm ready to sell now. Maybe they just were busy, maybe they were traveling, something happened and they lost your letter or your offer and now they're finally ready. They tried listing it with an agent, hasn't sold yet. They took somebody else's offer who canceled on them or backed out and they're like, this guy Joe must really want my property because he has followed up. So I do not treat no's as final. 93% of your deals will come from the follow-up. So continually follow up.

Next big mistake, focusing on $5 an hour activity tasks instead of the $500 an hour activities. People get stuck. They start asking, how do I do this instead of who can do this for me? So you might be spending hours on comping deals, on pulling lists, on skip tracing, on sending handwritten letters, wearing busy as a badge of honor. You might think I can't afford to do outsourcing yet. I'll delegate that after I start making money. But the problem is if you get stuck in this, how can I do mode and I have to do it all myself first before I outsource it, you're to get really stuck and you're gonna get on this vicious trap of doing $5 an hour activities when you should be asking bigger and better questions. In other words, who can I get to do this stuff for me? What you need to be focusing on, like I already mentioned before, is talking to sellers, making offers and following up. That's what you need be making sure you're doing. Outsource everything else. I used to do my own skip tracing. Yeah, that was bad. I use to handwrite my own letters and that was that. I remember a long time ago, I was doing marketing to landlords who were going through evictions. So every day I would go to court website and find the evictions and I'd find the owner of the rental property where the tenant was getting evicted and I would send that landlord a letter, hey, do you want to sell your property? Because I was getting them right when it was in the middle of an eviction. And I was doing the right things, but like I can get somebody else to do this. So I had the idea of like, I don't remember how I found as a friend of somebody that I knew who wanted to make some extra money. It was a stay-at-home mom. I called her and I said, hey do you wanna do this for me? Can you handwrite 20 to 30 yellow letters a day? When you handwrite them, I want you to crumple up the letters, fold them back up and fold them into fourths and put them in an invitation envelope and hand address the envelope.” And I remember so clearly she was like, that is the dumbest thing I've ever heard. Why on earth would you want to do that? That is so unprofessional. I was a little offended that she was calling what I was telling her to do dumb and telling me it was unprofessional and saying it doesn't work. I remember telling her, how do you know it doesn’t' work? Have you ever done it before? So I went and I bought her a couple hundred envelopes, a bunch of stamps, and some yellow legal pads of paper. So she started doing the letters for me, but then I was still adding, I was populating the data from the county courthouse website into a spreadsheet. I thought, wait a minute, I can get a VA to do this for me. So I started getting a virtual assistant every day, going to the court website and putting in the evictions on the spreadsheet. And then this lady would go to that Google sheet every day and handwrite 20 to 30 letters, crumple them up, fold them, invitation envelope. I tell you, this is the best marketing I'd ever done at that point. And I don't remember the exact numbers, but we were getting an insane response rates. It was really, really good. And that example is my time better spent handwriting letters or actually talking to the sellers who are calling me in response to the letters.

Another big mistake that I see a lot of people make is sometimes your offers are either going to be too high or too low. Big mistake I see. So let's say your offers aren't too high. Guess what's going to But you don't want to be in a place where all the sudden now you've got five ten properties under contract You think this is great and awesome, but now you put them on the market and crickets you start advertising them Nobody's interested in you offered too much. It's easy to fix though because you can go back to the sellers and say hey You know what? I'm sorry. We made a mistake. I reviewed the numbers,blameit on your investors,blameiton the numbers I reviewed. The deal with my investors. We looked at the numbers and this isn't gonna work Unfortunately, we have to either cancel this agreement or renegotiate a lower price. What would you rather do? And now contract gives you that 90 days where you can cancel or renegotiate for any reason whatsoever. So when you offer too much, guess what? You're not going to be able to sell your deals and the market will tell you pretty quickly whether you have a good deal or not.

The other mistake on the other side is offering too low because then what happens? When you're offering too little, you're not getting enough offers accepted. Everybody's gonna tell you no. You might go from getting one if you're offering too high, you'll get one out of every 10 or 15 accepted If you're offering too low, you're going to go from maybe one out of 100 being accepted or one out a none being accepted. So you need to find that balance. Be really careful about offering too much. Make sure you're not offering too. And let me give you an example. I was just working with one of our high-end apprentice clients this morning. We were looking into some markets and he wants to go into an area where there's a lot of competition. Competition is a good thing. This is an area. Where there's a lot. Of land flipping right now. I mean a lot, so I told him, okay, so you have to do it a little differently when you're in this kind of market. You can't just use that standard 40% formula. If you see everything is selling for 100, you can't just go in and offer 40 grand. If everything's selling for 20, you can't offer $8,000. These sellers are getting a lot of mail. They're getting a lot of offers and the offers they're getting are going to be all higher than yours. And by the way, this is an area where you can do a lot of assignments. Assignments are easier. You don't have to close on the deals. You can get a realtor to help you find a buyer without buying the deal yourself. So it's a lot easier to do an assignment. Now when you do an assignment, you're not going to have to pay realtor commissions or closing costs. You don't have to buy the property and take it down. You don’t need any private investors to close on the deal. You just assign it. And so it's easy to find the buyers. You just make a few phone calls and you can assign your deal for a quickthree-to-five-thousand-dollar profits. So I was telling this guy, are you okay with that? Are you okay in this area getting a lot of little base hits, a lot of little three thousand, five thousand, seven-thousand-dollar deals, profits instead of getting maybe one big deal every couple of months. And yeah, he was. So I would rather see you guys do five little $3,000 deals a month than one or two bigger $10,000, $15,000 deals a month. You might say, well, Joe, it's the same amount of work. Why do I even want to go after those small deals? So here's the problem. The bigger deals and the bigger profit deals, they take longer. There's more risk involved in those bigger deals. I want you to focus on those little small base hits, like three grand, five grand. Okay. So that means if you're going to do those little base hits because it's easier in that market to do an assignment, just make some phone calls and sell them really quickly. You can be in and out of these deals in one or two weeks. If everything else is selling for $40,000, you're gonna sell your deal for maybe $38,000. So you should just offer maybe eight grand less. Offer 30 for yours. Does that make sense what I'm saying there?

 Another mistake then is let's say you get a deal under contract and your due diligence is no good. What do you do during a duediligence time? Kind of already talked about it. You're putting the property out there to see if the other buyers are interested in it. If you're not getting any interest, there's a reason. There's only two reasons why your properties don't sell. It's overpriced or you're not putting it in front of the right buyers. During the due diligence period, after you have it under contract, you might have gotten that offer wrong. You might have offered too much. This is now during the due diligence period you're going to figure this out. If nobody is calling you back, if everybody's giving you the cold shoulder, if nobody's interested in the deal, you're selling it for too much, the first part of due diligence is making sure you have a good deal that other buyers will want. The other thing you have to think about is what are the physical characteristics of the property that might be making it hard to sell. If it has negative characteristics, that's okay. There's a saying in land that there's a pig for every barn. An ugly property will sell for the right price. A landlocked property that's 100% wetlands; that's on the mountain side of a mountain will sell at the right price. So due diligence is very important. It's not complicated. You need to look for things like road access, wetlands, floodplains, what's the terrain like? Are there utilities on the property or not? It's fine if it's not. And you can still sell deals that are landlocked. You can still sell deal that are in floodplain, but you just need to know this stuff and you might find out you missed some things. You thought it was worth this. You thought that thing that looked like a road was a road, but it's actually the neighbor's driveway or whatever, right? You find this stuff out after you put the property on the market. We just got one of our clients in the apprentice program. He sent a photographer to the property to go take pictures of it and there were signs from the neighbor on the road saying no trespassing. He was asking me, what do I do about this? I said, well, you need to ask the seller, why are there signs that say no trespass from the neighbors on your properties? And then you need to get that neighbor's phone number and call them and ask them and talk to them about it. Another part of due diligence you need to be aware of is the homeowner’s association rules. Do they have high fees? Usually, it's not a big deal because we're only going into areas where there's already been a lot of So if we go into an area where it is an HOA and there are restrictions and the HOA dues are high Maybe it's not a big deal because there are properties already selling there One of the things I tell sellers is that okay, I'm gonna need time to do due diligence to see What I want to do with the property. I don't know if I'm going to build a house on it, I don't know if I’mgonna flip it or sell it with owner financing or just hold it for 50 years, I don't know what I'm to do that yet. So during that due diligence time, that's when you're calling realtors You're calling buyers. You're called investors who bought land before you're called the neighbors, you're calling realtors that I say that already and you're calling the county and you are trying to see can I build a house here? What needs to be done to build a house on this vacant lot? Not that you're going to do anything, you're not going to add a septic systems, you are not going to add well, you not going add bring utilities in, you not going clear a road, you aren't going to cut the grass, you don't do anything but you need to know what this stuff is so if you realize man I don't have a good deal, you can go back to the seller and say hey I'm sorry this isn't going work out. We either need to lower the price or cancel the agreement. That's why you have the due diligence period, that's why you have the 90 days.