Time Savings Tips for Land Investors (CFFL 529)

Transcript:

Jack Butala:                         Jack Butala with Jill Dewitt

Jill Dewitt:                           Hello (laughing)

Jack Butala:                         Welcome to our show today. In this episode - I can tell it's going to be funny already. Jill and I talk about time saving tips for land investors or really anybody. Before we get into it let's take a question posted by one of our members on the Landinvestors.com online community, it's free.

Jill Dewitt:                           Okay, I forgot who this is but this is their code name on here Shamgod asks, "There is a subdivision I've got a few tentative deals in but the parcels might not have legal access. They're not landlocked but have the possibility to be in the future. Properties are slow moving, priced at $1000 - $5000 an acre out there but those are the ones without potential access problems. What type of price would be your max? I've got a 5 and a 10 acre property that I'm looking at. I'm thinking $3000-ish for 5 acres, does that sound about right? Not sure if there's a good rule of thumb."

Jack Butala:                         May I?

Jill Dewitt:                           Yes, please.

Jack Butala:                         There's two questions here: one's to do with access and how should I price this stuff, so I'll take the second one first. How should I price it? In general, there is a rule of thumb for vacant land like this. You want to be at about 40% or 50% of the lower echelon of the priced property, which sounds to me like $1000 an acre so that would bring it down to $500 an acres. So $500 for 5 acres is what, $2,500? Yeah, so, he says, right at the end, "I'm thinking $3000 per 500 acres question mark, does that sound about right?" Well, you answered your own question. That sounds perfectly priced to me, where you could double it and sell a 5 acre property for 6 grand, which is doubling your money, really quickly and you're still way below what retail is so the answer is hell yes. Question number one.

Number two is: they're not landlocked yet but they might be in the future. Well, in general Jill and I do not buy property that has no access. When you look at it on the screen from Google Earth or from ParcelFact or wherever you're looking up your property and there is absolutely no way to get it, not even a regular trail or anything else and it's not close to a road, we pass. At any price, we pass. If it's showing some signs of yeah it could be platted legal access but you know you just need to lay the road in, now we're talking so that's a good reason sometimes to buy really undervalued property because nobody has taken the final step to just make it a great piece of property. That's what is sounds like here, so the answer is unfortunately I don't have a hard and fast answer but the answer is look into it. You can call an assessor and look into it in great detail because sometimes you can buy property that's incredibly inexpensive or undervalued because nobody has taken the final step to just get a road in there.

Now's a good time for me to bring this point up because it's come up all week. I called the assessor and they said, "Fill in the blank," What are they going to say Jill?

Jill Dewitt:                           I'm not an attorney.

Jack Butala:                         That is one thing. Let's play this game right now, do you mind?

Jill Dewitt:                           (laughing) Sure. You interrupted my lunch.

Jack Butala:                         I called the assessor ... Yep, go ahead, keep going, you're on the right track. I called the assessor and they said ... Call an attorney-

Jill Dewitt:                           It's a bad area.

Jack Butala:                         It's a bad area. Ding-ding-ding-ding-ding!

Jill Dewitt:                           Nobody's buying anything there.

Jack Butala:                         Nobody buys the...