A Close Look at One of My best Deals in 2023

One of the lies about real estate that is popular among new investors is how easy it is. Just buy the most expensive property you can afford, wait a while, the price increases, and you sell at a profit.

The most dangerous outcome is if that happens to you. Now, you believe that you can rinse, repeat, and win after that purchase or two. That’s not likely to occur. Real estate is simple but not easy. The concept is simple: people need a place to live or build things. Over hundreds of years, on average, real estate has increased in value and generated healthy cash flow for owners.

But not always. At other times, interest rates have peaked, tenants leave, or tenants stay but don’t pay, and the landlord is left bankrupt. If you think your home is an investment, you know now that is untrue. Even so, perhaps your home value would shoot up if your timing was right, but selling it to gain that profit doesn’t make sense because you just have to turn around and buy another expensive home.

Let’s look at the simple purchase of 95 acres of land in Livingston Cove, NS, last year and the not-so-easy parts of that purchase.

1. The land was offered for $107,000, was on the market for over 200 days and had several price drops over time.

2. It was a clear-cut parcel, meaning most trees had been cut down for logging.

3. It was in Livingston Cove, which had the advantage of being near a park but somewhat isolated.

4. Clear-cut meant that there was no value in timber. It was, however, ideal as an ecosystem restoration project.

5. I received a very favourable report from my consultant. It indicated that “Property could likely be subdivided to 33 to 112 lots.” At $50,000 per lot, the return could be in the multi-million-dollar range. I considered two lots to allow for some recovery, but the remaining 85 acres are to be kept as an ecosystem restoration project.

6. The elevation of the land was favourable for ocean views in specific locations. It was well above sea level, 24 to 41 meters above sea level at the back.

7. Walking the property before waiving of conditions gave me a good gut feeling. I waived the requirements and made the deal.

It takes several years to develop a process that leads to that gut feeling to walk or purchase an investment. I can’t give you specific details of how long it takes, just that it’s more than five years and likely less than 30. 

Investing is often very simple but not easy. The hard part is putting in the work to build those gut instincts that are crucial to turning random chance odds into more secure victories.

What are we doing now with the property? We have put in an entrance, and after receiving the green light on zoning from our consultant, we are putting in access to the property and gravel pad for RV parking. If this concept works, we will use it on other lands we have purchased throughout the province. Go to hipcamp.com and search Livingston Cove Retreat to get a closer look.

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