If I offered you your choice of two properties: a $1,000 vacant parcel of land and a $100,000 house, which would you choose? If you’re like most people, you’d snap up the house. And you’d be making a BIG MISTAKE. I’ll tell you why in today’s episode. I’m Carole Ellis. This is Episode 55.
If someone told you that you’d be crazy not to take a $1000 parcel of vacant land over a $100,000 house, you’d probably turn right around and tell them they’re nuts. However, my guest today has spent the last 20 years doing just that, and let’s just say his business, his investment success, and frankly his LIFESTYLE indicate that he’s not crazy at all. I’ll tell you all about it in today’s episode, but first I want to take just a minute to talk about something that IS crazy: making BAD DECISIONS when you know they’re bad just because your EMOTIONS say you want them to be good. Did you know that’s how more than 90 percent of all real estate scams happen? The victims KNOW they’re doing something inadvisable, but they DO IT ANYWAY. And how do they know that? Because there are red flags that indicate you’re dealing with a con artist from a mile away, but every day thousands of people choose their emotional inclination to ignore these flags over their intellectual knowledge that they’re about to get conned. You can get a free report about these red flags from REI Today by going to www.rei.today/scamalert (one word) right now. Don’t let your emotions make you crazy – at least not where your real estate is concerned!
Now, let’s get back to something that LOOKS crazy on the face of it, but actually is some of the best real estate investing strategy I’ve ever seen. First, let me tell you a bit about today’s guest. His name is Jack Bosch, and Jack came to the United States in 1997 with no money, tens of thousands of dollars in student loan debt, and ZERO knowledge of the U.S. real estate system. “It was actually a blessing to know absolutely nothing about how things worked,” he told me, “because it enabled me to see much more clearly than other investors that the number one type of real estate that people have out there tends to be a fairly inexpensive piece of land, usually worth less than $80,000.” He added that most are actually worth $10,000 to $30,000, and that’s “the sweet spot,” he noted. More on that later.
Anyway, these parcels of land tend to be something of a drag for their owners. You owe property taxes on them, you can’t really use them for anything, and often the reason the person bought the land in the first place (usually, Jack said, it’s a result of retirement planning when finances are good and they go ahead and buy DEVELOPED LAND that is ready to build, thinking they’ll build in the future) anyway, often the reason that they bought the land in the first place is no longer valid. They’ve since divorced, or their retirement goals have changed, or their finances have changed, the list goes on and one.
So Jack gets here in 1997, takes a look around at a completely foreign real estate system, and sees all this vacant land out there that literally nobody who knows about it wants. And he quickly realized he could buy that land often for prices as low as 5 cents on the dollar because the owners just want it off their hands. “Think about it,” he said. “If you buy a $30,000 piece of property for $5,000, it’s a pretty safe bet that you are going to make money on that deal. In fact, my first deal, I bought an $8,000 property for $400 cash, no mortgage, and I sold it to the neighbor for $4,000 the second I put a sign in the yard.”
As you can imagine, after that Jack was hooked. “Why would I go to auctions or into markets where there is a bunch of competition when I can just send letters to a certain subset of landowners and they’ll be thrilled for me to take their property off their hands?” he asked, noting that these are “perfectly find properties, beautiful pieces of land” that someone else will be thrilled to get from him at a deep discount, it’s just that the current owners no longer have a need for them. Jack’s second deal was a 40-acre parcel that he bought for $500 and sold for $10,000. At that point, he says, “This seemed to be a pattern, so I decided to do it again.” Even more interesting, Jack doesn’t ever mess with houses, because he’s figured out a way to actually generate some serious passive income from vacant land in a way that is possible – but more complicated – with developed properties.
You can find out all about that strategy (it’s simple and quite frankly, brilliant) by reading the entire interview transcript which is waiting for you in the REI Today Vault over at www.rei.today/vault. Not yet a member? You know I’ve got you covered! Just text REITODAY no spaces, no periods, to 33444 and I’ll send you all the information you need to access the vault immediately. And if you happen to live in the Atlanta area, then I’ve got really great news for you! Jack is presenting the KEYNOTE ADDRESS at this month’s GaREIA general meeting on May 9. Doors open at 5:30 at the Wyndam Atlanta Galleria at 6345 Powers Ferry Road. This is the BEST MEETING YET to attend, because we have some really exciting changes in the works, so be sure to get there right at 5:30 so you can participate in a new networking event (and possibly win $50 from Home Depot, by the way), hear all of our faculty-focused educational sessions, and catch Jack’s entire presentation in person! If you’re not in Atlanta (and you can’t get here) don’t feel badly, though. You’ll have a chance to hear more from Jack in the very near future, so text REITODAY no spaces no periods to 33444 or visit us online at www.rei.today/vault to make sure you’re signed up for those updates and read that interview. I’m telling you, it’s good.
And folks, remember, when you joins us at REI TODAY, you’ll also be able to GROW YOUR NETWORK by interacting with me and your fellow listeners to REI Today… so stop by to ask questions, make comments and network with other investors across the country. Text REITODAY no spaces no periods to 33444 or head over to www.rei.today/vault right now.
REI Nation, thanks for listening in and always remember this:
Your best investment is your own education.
Carole Ellis is the host of Real Estate Investing Today, a popular 9-minute daily podcast focused on educating real estate investors about the important topics that will make their investing SAFER, FASTER, and MORE PROFITABLE. She's also the editor of the Bryan Ellis Investing Letter. She has more than a decade's worth of experience in and reporting on the real estate industry and, additionally, has written dozens of courses on the topic. Carole lives in Kennesaw with her husband, Bryan, and four children. She believes wholeheartedly that your best investment is always your OWN education.