Buying and Selling Land and other Real Estate- It isn't About You

[Adam Harrison]

When I was right out of high school, I became good friends with an extremely hard working and powerful woman. She had graduated school with a degree in Computer Science and excelled in this field. She rose through the ranks in a computer consulting company and actually became a partner. She rose above sexism and ALL other reasons she could not succeed and really made it.

I had a strong desire to succeed in computers, but at the time, I didn't want to further my education because I didn't feel it was necessary. I didn't think it was necessary so I didn't think it was needed as an element of my success.

She gave me many words of wisdom, but when I told her this, she said something that stuck with me to this day. She explained to me that while she understood that I didn't want to continue my education, basically I needed to look at what the people who were hiring wanted and what was needed in order to get into the position that I wanted to get in. And that was further education. 

We have a very similar principal at work in land flipping and other real estate niches. Too many investors get their ideas and emotions so mixed up in the process of buying and selling, they end up failing. They are making the same mistake I was making as a kid, trying to break into the computer industry. Thinking in my case that, the hiring manager should FEEL the same way that I do which is incorrect. It is like an investor, thinking that a buyer will think the same way that THEY do which is completely incorrect.

Just because YOU feel a certain way doesn't mean that a BUYER will feel that same way. One of the hardest properties I had to sell, a property that took literally years to sell and when it sold, I actually sold it at a loss. At a LOSS. Before I purchased it, I checked with a realtor and checked comps. It should have been a home run, but it wasn't. And this is despite a lot of work and a lot of marketing.

This picture below is NOT of the property, but it gives you an idea of the general area where it was located. It was buildable and there was electricity in the area. It was about 4 acres.

I looked at the property pictures and researched the area and just fell in love. I thought "of course, someone is GOING to buy this, it is SO beautiful and amazing." I was wrong.

Let's take a look at another property. Again, this is not the EXACT property, but this gives you an idea of the general area. It was 10 acres that looked a lot like this. There was a dirt road going to the property and it was completely undeveloped. No trees, no utilities, nothing.

I got a lot of interest in the second area and actually ended up selling the 10 acre property for about triple what I had to sell the perfect property for. And it cost about 1/3 of what the "perfect" property cost. So it was a total home run. Again, the perfect property had a much higher assessed value and according to the "experts" it was worth way more than this piece of "junk." Yet when buyers visited this property they loved this "junk."

In case you are wondering, they are both in the same county.

So my point is, that it TRULY wasn't about me. It was about what the market wanted, not my ideas as to what should or shouldn't sell. So, in examining potential investments, it is important to never let your emotions get involved. Buyers want what they want and it isn't our role to decide that they should or shouldn't want this or that. It is our business, as investors, to find bargain properties and either hold them or provide them to an end buyer who wants this product.