From the desk:Dispo / Marketplace Services

Five months of a 400 a month buyer network and nothing bought

Five months into a paid land buyer network and I've closed zero. 400 a month, so 2,000 spent. The feed sends me 6 to 15 rural and infill lot deals a week, and I've made offers on nine of them.

What I've found looking back through my notes. Four of the nine were already under contract with someone else when the email went out, which the sender admitted when I called. Three were priced at or above what I can get retail on comparable acreage in those counties, before any entitlement work. Two were real, and both went to a buyer who wired without a survey or a title commitment. I won't do that on land where access is unrecorded, and in one of those counties the access easement was a handshake between two families going back decades.

I hold for 7 to 15 years, so my price discipline is not going to change. My cost basis target on raw acreage is 45 to 55 percent of what I think the parcel supports after a split, and I'll wait years for that.

So the question is whether a paid feed is even the right channel for a patient buyer. The economics of the service reward whoever answers fastest with the fewest conditions, and that isn't me. My alternative is to spend the same 400 a month on county-level relationships, mostly surveyors and a couple of rural title agents who see the estate stuff early.

Cancel and go direct, or stay in and accept that I'm paying for optionality on the two real deals a year?

Answer

2samantha_ruizAU4APRO6

You've described exactly why I stopped paying for feeds. The deals that clear a distribution list clear it because they're priced for a fast buyer with loose conditions, and your underwriting is the opposite of that. I'd still keep one thing from the five months. Go back to the sender and ask to be flagged as a buyer for anything with title or access problems that their normal list refuses. That's a small, real niche, and dispo people hate holding a parcel nobody will touch. I did that with two wholesalers on my side and I now get called first on anything with a probate or a boundary issue, at prices well under what they'd blast out. No subscription involved, I just made myself the person who answers on the ugly ones.

2 replies

1nataliehsuSO1BPRO7

The four already under contract is the number I'd complain about. If a service is emailing deals it has already sold, you're paying to be a stalking horse for their price discovery. Ask them what their list-to-close ratio actually is and how they date-stamp a deal as sold. If they can't answer, that tells you what the 400 is buying.