Real Estate Deal Analysis & Advice

Best Deal Ever Show #10: Substitute Teacher Makes $80K on First Land Deal

Expertise: Real Estate Investing Basics, Landlording & Rental Properties, Real Estate News & Commentary, Mortgages & Creative Financing, Real Estate Wholesaling, Personal Development, Flipping Houses, Business Management, Real Estate Deal Analysis & Advice
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Aerial View Of Green Forest Landscape. Top View From High Attitude In Summer Evening. Small Marsh Bog In Coniferous Forest. Drone View. Bird's Eye View.

Best deals come in all shapes and sizes, and investors have their reasons for why they consider it their best. This particular investor considers it his best because it was life-changing, as it was the rocket fuel to launch him into his investing career.

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Prior to running his own successful real estate wholesaling business, Brett Snodgrass was a substitute teacher making around $15,000/year and was an occasional bird dog for a land developer who specialized in timber. While scouring for properties, Brett came across one on an auction site; however, it wasn’t going to auction—it was just being sold outright as an estate sale.

How One Investor Sourced a Life-Changing Real Estate Deal

So, Brett reached out to his buyer, who declined the deal because there wasn’t enough timber to interest him.

Despite the developer not wanting it, Brett saw the opportunity and decided to approach his dad about partnering and buying it. The property was configured with a road that divided it into two tracts of land, which made it more attractive to Brett—he saw the potential of turning one parcel into two and selling them off individually.

Since the property was most likely going to be used for recreational purposes (e.g., hunting, ATVs, etc.), he believed that he was more likely to sell two smaller parcels than one larger one.

Related: Best Deal Ever Show #7: Infinite ROI Through Owner Financing

Making an Offer

As mentioned before, this was an estate sale. There were six siblings involved, who were going to be dividing the proceeds from the sale six ways. They were asking $252,000 for 126 acres, which comes out to $2,000/acre.

However, Brett felt like there was room to negotiate. They would be splitting the proceeds anyway, so it wouldn’t feel like that much of a difference if he offered less.

Negotiating Intelligently

Instead of communicating the offer with a new dollar amount, one significant negotiation tactic that Brett used was to make an offer per acre. So, he offered $1,200/acre, which seems a lot easier to swallow than him asking for a price reduction of $100,800.

After some back and forth, they ended up agreeing to a purchase price of $1,200/acre or $151,200.

Surveying the Land

Prior to closing, Brett and his dad decided to start the surveying process to verify the acreage; however, due to the age of the previous survey and the rudimentary process used, it took much longer to obtain than normal. The surveyor—aware that it was taking longer than anticipated—contacted Brett to let him know that he was almost finished. It would be another month, but he believed that the property wasn’t going to survey for less than 126 acres—in fact, it would probably end up being more.

Since the sellers were wanting to close, they decided that they would take the risk of closing before the survey was completed and put 126 acres on the deed. That risk paid off big time…

Once the survey was finally completed, it came back showing that there were actually 133 acres, giving Brett and his dad an additional seven for free!

Related: Best Deal Ever Show #8: Appealed Appraisal Adds $115K to Property Value

subdividing-land

Selling the Deal

So, now they had a 40-acre and 93-acre tract, which they ultimately sold for $1,750/acre to two farmers. After paying closing costs, the loan payoff, and other fees, they ended up with just over an $80,000 profit in only a few short months.

What We Can Learn From This Experience

Brett didn’t immediately jump into full-time entrepreneur mode. He continued to work for other investors until he was able to consistently replace his salary with the efforts from his own side business.

He suggests before doing your first large deal and immediately taking the plunge into doing your own thing, make sure it isn’t a fluke and that you have consistency in your business.

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Questions about this deal? Would you ever buy/sell land? Why or why not?

Leave a comment below!

Ken Corsini is a seasoned real estate investor and business owner based in Woodstock, Georgia. Ken is best known for his role on HGTV’s hit show “Flip or Flop Atlanta,” and has flipped over 800 hou...
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    Logan Eckstein from Durham, North Carolina
    Replied about 1 year ago
    Negotiating the price/acre instead of the total price is a stroke of genius. Thanks for the great write-up!
    Brett Snodgrass Investor from Indianapolis, IN
    Replied about 1 year ago
    Thanks Logan, Glad this helped. God Bless, Brett
    David M. Tkacik
    Replied about 1 year ago
    How did they market the property and find the farmers?
    Brett Snodgrass Investor from Indianapolis, IN
    Replied about 1 year ago
    We marketed the property on some Land Sites. Back then, there was landandfarm.com and landwatch.com Now there are some larger land websites. www.landwatch.com www.landsofamerica.com www.land.com People looking for LAND, look at these sites way more often than the MLS. Thanks, Brett
    Nelson Gordon from Shawnee Mission, KS
    Replied about 1 year ago
    Best paces to find land deals in Missouri?
    Brett Snodgrass Investor from Indianapolis, IN
    Replied about 1 year ago
    I would check these sites www.landwatch.com www.landsofamerica.com www.land.com
    Paul Moore Investor from Lynchburg, VA
    Replied about 1 year ago
    Ken. Thanks for sharing this. Great story!
    Seth Williams Specialist from Grand Rapids, MI
    Replied about 1 year ago
    That’s amazing. Brett is the man. I love hearing all the ways people can squeeze money (and sometimes A LOT of it) out of dirt like this.
    Brett Snodgrass Investor from Indianapolis, IN
    Replied about 1 year ago
    Thanks Seth! You are amazing when it comes to LAND! You da man!
    David Brian Lounder
    Replied about 1 year ago
    I'm guessing he didn't fess-up about the additional acreage to the original owners, and pay them what he REALLY owed. Not cool. Not cool at all. Dave Lounder IMDb.me/DaLo TheDriveInGuys.com
    Chris Kreidel Lender from Huntington Beach, CA
    Replied about 1 year ago
    Why? he took the risk on closing without that information, and it could have gone either way.
    Brian D'Agostine
    Replied about 1 year ago
    If he did fess up about the original acreage, would you then expect the heirs to fess up to the county that their parents had not been paying enough property tax for the last however many years? That's the thing about real estate. The numbers are right until they're not. And then they're right from that point forward. The acreage was deeded as 126 until the new surveyor completed his work, at which point it was 133. But that info didn't come to be until after the sale. However it's also entirely possible that a surveyor 30 years from now could declare the 93 acre parcel as being only 90 acres. Would you expect when the news comes out that Brett would then refund the farmer the $3600 for the shorted land, plus interest? Moral of the story is, check your facts BEFORE you sell.
    Brett Snodgrass Investor from Indianapolis, IN
    Replied about 1 year ago
    Thanks for the backup Brian & Chris, The answer was, no I didn't go back to the originals owners and let them know that the survey that I paid for surveyed out the land for more acreage, as that was the risk I took. I have been in other situations where the acreage came out less. So when buying a piece of land without a survey, you just take that risk, and you win some and you lose some.
    Leo Roscoe
    Replied about 1 year ago
    Great story. It would be nice to know how they put the financing together to close the deal.
    Brett Snodgrass Investor from Indianapolis, IN
    Replied about 1 year ago
    Leo, Thanks for the reply. I met a man at a local REI in the town. It was super small. Like 8 people went to this Rei. But one of the men was named Tuffy, and he was an investor / private lender. When I found this land, I called up Tuffy, and he lent us 126K for this land at 12% interest. We put the down payment down, and did the deal. So, you never know when you meet someone that can really help with your deal!!! That was the only deal Tuffy and I ever did together, and it changed my life.
    Kane M.
    Replied about 1 year ago
    Yeah, I'd be curious to know how much profit went to the teacher and how much to his investor/dad
    Brett Snodgrass Investor from Indianapolis, IN
    Replied about 1 year ago
    We Paid the private lender prorata amount 12% interest per year for the months we held it, and then my dad and I split the Profit.
    Latunya Smith Flipper/Rehabber from Fayetteville, NC
    Replied about 1 year ago
    Ken, Thank you for sharing and the motivation.
    Neil Blyther Investor from Staten Island, NY
    Replied about 1 year ago
    Awesome story! Thanks for sharing. Reading investment testimonials such as this keeps me going!
    Adam Wallen Rental Property Investor from Grand Rapids, MI
    Replied about 1 year ago
    Great read. Love that he used the cost per acre to negotiate. However, since he used this method, hopefully he paid the $1200/acre for the additional 7 acres as well.
    Michael Baum from Olympia, Washington
    Replied about 1 year ago
    I don't understand this. He negotiated an offer. It was settled. The owner of the property didn't pay for a full survey to verify the land. He sold it based on the survey he had. I wouldn't expect the new owner to pay for the extra land that was found after they paid for the survey. Bottom line is to do your due diligence before you sell any property you own. If you suspect that the survey is off or that it is so old that it could be wrong, pony up the dough yourself to get a proper assessment.
    Brett Snodgrass Investor from Indianapolis, IN
    Replied about 1 year ago
    Correct Michael, We offered on the land a certain price based on the acreage on the legal description. After the sale, we surveyed the land and it happened to be more acreage, but it could have went the other way too. That was the risk we were willing to take. If it was less acreage, then we wouldn't go ask the seller for a refund. It is a risk, and this time it worked out in our favor. thanks
    Thomas Delaney
    Replied about 1 year ago
    Seller should have done a survey prior to listing. Due diligence is the responsibility of both parties but estate sales with multiple individuals are often rushed just to be done with the sale. Both seller and buyer were happy with the price at closing so “NO” he owes estate nothing more.
    Brett Snodgrass Investor from Indianapolis, IN
    Replied about 1 year ago
    Thanks Thomas!
    Bryan Trelegan Rental Property Investor from Hyannis, MA
    Replied about 1 year ago
    Could have sold the 90 Acres and made a small profit , with a small tax bill. Had 40 Acres for free to lease and borrow against while it appreciates tax free.
    Violeta Archer Specialist from San Antonio, TX
    Replied 6 months ago
    Brett, Thank you for sharing this. I'm in a similar position--- I finally have the job of my dreams, but it's as an independent contractor. Although I have good credit and hardly any debt, banks won't loan due to my 'independent' status. I'm looking for a really good opportunity that I can leverage to build a nice portfolio and fund my design projects.