How to Get That First Deal Under Your Belt - Risk Free
Most real estate investors don’t know that you can purchase great property in very rural areas for next to nothing and own it free and clear. 10 acres Nevada for $1,000 or 2.5 acres in Northern Michigan for $2,500 or 40 acres in West Texas for just a few grand.
We have made a career out of this effort.
Many new investors have real trouble getting past that first deal. I continue to respond to questions regarding this topic in various places.
I wrote this blog entry to try to help anyone who is searching this topic.
Here is my advice:
1. Find a great piece of land for sale on a website like landwatch or landandfarm (no affiliation in any way) that is listed for $1K or so. Follow what I can the rule of the “4 As” The property should have Acreage, be Affordable, have good Access and sport some type of Attribute i.e. “close to the grand canyon”, or “lake view” or “great for mobile homes.”
2. Buy it without an escrow agent so you actually learn how property is conveyed and recorded.
3. Dress it up for presentation on the internet with great pictures, maps and a class-A written description. Find a property on the internet and use it as an example of how to post your land (like a $22 million dollar home in Bel Air) and create a posting that is equally impressive).
4. Mark it up 100% (yes, double) and sell it. The property will sell quickly if done correctly. Don't use an escrow agent on the sale either.
Suggestions: Make sure you buy it right. Look at other like kind properties and be sure you are priced well below the asking price of the others. You may have to submit 10+ offers or more to get the right deal.
You will make a ton of mistakes on the phone, with paper work and all the other details associated with the deal. It's only a few hundred bucks and now you're ready to move forward with more money at stake.
Like kissing a really pretty girl, this will give you confidence you need to move on to better opportunities.
Comments (8)
how do you close the deal without an escrow agent?
Account Closed, over 8 years ago
Very interesting. It's a simple and creative way to get started with very little risk.
Thank you for your post
Tomas Chao, over 8 years ago
Prompt replies are always greatly appreciated, and I also hope to hear more from Steve on that inquiry.
Lydia S., over 8 years ago
good article. I am also intrested off possible pit falls like glenn
Oscar Caballero, over 8 years ago
Interesting advice. I'm "nervous about my first deal" and realize that everyone has to start somewhere & it gets easier.
Are you saying that we can do the entire process of buying & selling the property online, or over the phone, without ever having to actually travel to the property or the county?
I browsed through one of the sites you recommended and found some cheap listings. One is only $99 for almost 5 acres! So, I can literally pay for it from my spare change. Something has to be "wrong" with the property, so how do I check it out? I could sell raffle tickets to move a property this cheap, but I'd still need to be sure it isn't some kind of financial booby trap that could be a liability as soon as I buy it.
Can you elaborate a bit more, for newbies like me?
Glenn R., over 8 years ago
I am interested to see the response to Glenn Randle's question..
Jon Stanton, over 8 years ago
I enjoyed this post, Steven. In my experience, doing that first deal is a big stumbling block for aspiring investors. But once they can get over that hurdle, they can move forward. So your post is perfect because it's a creative, affordable,and little-known way for people to get started in real estate. Well done!
Kent Clothier, over 8 years ago
Interesting and informative!
Christopher Arnold, over 8 years ago