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In this episode, Daniel and Anthony delve into the concept of "Trash Arbitrage" in land investing, a strategy where properties with significant trash or debris are acquired at a discount, and either sold as-is or cleaned up to generate a profit. They share personal experiences, including dealing with properties covered in shingles, tires, and even a burnt-out RV. The discussion highlights how trash can deter most investors, but for those willing to take on the challenge, it presents a lucrative opportunity. The episode encourages listeners to see beyond the trash and recognize the hidden value in such deals, offering to JV with others who find similar opportunities.
Introduction to Trash Arbitrage (0:01 - 0:45):
Daniel and Anthony introduce the concept of trash arbitrage and its potential in land investing.
Case Study: Shingle-Covered Land (0:45 - 1:17):
Anthony shares a story about a property covered in shingles that initially seemed like a bad deal but turned out to be profitable.
Dealing with Large Cleanup Costs (1:17 - 3:02):
The discussion covers how to handle properties with significant trash, including getting quotes for cleanup and negotiating with sellers.
Maximizing Profits with Minimal Cleanup (3:02 - 4:42):
They talk about strategies for selling properties as-is or with minimal cleanup to maximize profits.
Success Stories and Encouragement (4:42 - 6:46):
The episode wraps up with success stories and an invitation for listeners to bring similar deals to JV with the team, emphasizing the value hidden in "trashed" properties.
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Transcript
what is this what is this one called
Daniel trash Arbitrage trash Arbitrage
trash Arbitrage this is one of my
favorite topics uh and I don't think
anybody's talking about this one no dude
so check this
[Music]
out when we starting out in land I
didn't know what a good deal was or what
a bad deal was right you kind of don't
know how to identify either yeah um so
when we got our first major major trash
lot was the one with all the shingles on
it like 5 Acres of shingles dump piles
of shingles yeah so I figured you know
10 20 grand worth of dumpsters were good
right man we got quotes for 75,000
$80,000 to clean this place up mhm I
think even a hundred so I'm like well
that kills a deal for me I've seen
enough right not knowing what we didn't
we didn't know anything about you know
this deal or the way these deals work
but um this was a cool deal because the
seller almost begged me to take it so
I'm like damn okay well I better help
the guy at least at least I could do the
real problems trash is the real problem
yeah so the guy was like hey no dude
like let's do this like the seller was
ready to do anything he's like just help
me sell it I'm like well say no more
then I'll get it done cool bam sold the
whole entire property with the trash in
place made like 40 Grand on that deal
without moving a muscle on the trash or
mowing the grass or anything so the the
really cool thing about like trash out
trage is that sellers if they know it's
trashed and if you make them wear it's
trash they're like oh crap like how
trashed is it and then like you get
quotes and like oh it's that trash bad
this is bad okay so then it creates
motivation and trash on Lots happens a
lot it happens a lot especially on Raw
land so this is part of our our issues
that come up where we have to worry
about animals and endangered species
like in Florida we have trash yeah so if
if you think about it like this
mountains of tires mountains of trash
that scares people away any investor
especially yeah buyers especially cuz
they're like oh no like everything's a
big deal to a buyer mhm right and even
to an investor so even an investor will
see this property and say damn this
thing got 10,000 tires on it like I'm
out that's just too big of a of a
contract for their brain to Fathom but
we see that and we see opportunity money
hey yeah so now you know when somebody
sends us a property that where it's
covered in junk like I'm going to weigh
in the cost of that cleanup into the
price of the property actually I'm
working on one right now with JV with
somebody I won't say any names just
right the second but um we're we're
going like we've been trying to sell
this property for this person for a few
months and I'm like something's wrong
seems like a great price great area I go
to see the property myself there's so
much junk and it's so overgrown you
can't drive you drive in and you have to
turn around to leave there's nothing to
see at all and all that acreage like six
acres or something so I got we got
equipment coming in this weekend and uh
he's going to start pushing trash around
making it into separate piles but all
the while flattening all the grass so we
can drive the property and take a good
look at it and that's that right there I
know we're going to get a contract
immediately just cuz we clean it up just
any type of work will will make it worth
well so I have a funny story too so if
you haven't heard my Florida deal story
we bought uh 9.9 acres in Florida um a
pre-foreclosure and seller left a burnt
out RV on the property had no idea after
it happened till a buyer went there and
he's like hey you know there's a burnout
RV here and I'm
like had no idea like I don't know that
brought RV congratulations I just in I
just inherited a burnt RV
and I'm like but what do we do with
trash most of the time we leave it there
we leave it there and pass it to the
buyer and buyer n buyer gets to
celebrate with that trash and the cool
thing about this is that I think people
are willing to deal with the trash
because you might sell their Finance
them you might give him a discount you
might do a lot of different things where
it's almost like that that contractor
like if you sell a a partially flipped
house to a contractor he's going to I
can do it myself you know knock it out
and it'll take me a couple weeks and
I'll just knock it out myself and I'll
do cheaper I get a discount you know so
they might discount us a little bit but
we still have enough margin where they
they're not going to see the 75,000 just
like we saw it they yeah I can do it for
10 mhm like all right and they'll take
on that that that $10,000 trash profit
which might be 15 and some extra back
back work you know yep and and we've
done it ourselves too we've got you know
maybe 50,000 in dumpsters you know in
the last 365 days yeah but um you know
it's we're we're so we're okay with
cleaning stuff up but if at all possible
we we you can just leave it in place and
sell as is if you can sell it as is
that's what we're going to do but if we
need to clean it up we're we're okay
taking on that risk where we have to we
have to uh if we have to clean up we
will but if we don't we don't don't do
it but there's always money in the trash
Arbitrage that people just overlooking
90% of investors will not touch trash at
all but we will I got one from uh hbhs
uh earlier this year and I thing it
needed a lot of trash it was only a 3
Acre property but it needed like 20
gring cleanup and uh you better believe
we did it and it sold it sold reasonably
quick after that amount of cleanup but
somebody gets there and they see that
and they're like oh hell to no like this
just looks like a nightmare look cuz
imagine you trash out a little
three-bedroom two bath house and that
might be 10,000 in dumpsters or
something crazy yep right so so to trash
out acreage people get there and they're
like nope leaving they just turn in the
opposite direction and run but us like
it's something that we're used to and
something that we're actually actively
looking for so if you guys find any
properties with trash on them send them
to us man would you be we'll take a look
at it in JV with you you want to tell
the tire story uh yeah that one that
one's still in process I don't like to
tell too many fish stories haven't got
caught yet but on that one yeah we
picked it up for 300ish Grand and uh we
cut it in five pieces sold it all off
for roughly like
9950 and uh we're waiting uh on one of
those one of those tracks a neighbor
bought the he bought one track a 10 acre
track and then he says hey I'll buy the
one with all the tires I want a discount
on it so based on what our cleanup cost
was going to be versus what he he was
willing to pay for it we were in the
green by just letting him buy it as is
at his crazy discounted price Y and the
deal still penciled out it was still
like a 3X deal so it didn't didn't hurt
the deal at all yeah yeah trash
Arbitrage it's a good strategy if you
see opportunities we're buying but if
you if you're in the business keep it
out for them there a lot of money there
and we're trying to work with you guys
we we tell you guys all these secrets
not to tell you like hey we got deep
dark secrets like we want you to find
deals bring them to us as JB you learn
as the way we go we both get paid
everybody's happy the biggest thing is
you got to know what value looks like so
trash Arbitrage is one of the ones that
there's value there you see it let us
know there's money there let's get that
trash like subscribe share this content
guys we appreciate you guys following
love right
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Daniel Esteban Martinez
Host/ Ceo/ Speaker
I have been an entrepreneur since 2018. I come from a regular home just like most people. My dad worked on the roads in the Chicago area for over 30 years. He always taught me to work with my brain, instead of my body. Your body can only take so much abuse. I learned so much from my father. He always pushed me to work smarter and not harder.
I have owned and operated a trucking business for 2 years. I started learning real estate in 2019. Fell into the Data & Skiptracing business in 2020. My partner Anthony & I started Hivemind in 2021.
I have done a ton of different jobs coming up from painting, to door-to-door sales, telemarketing, truck driving, and loading trailers. What I learned most is that I want to stay in the digital business space. The leverage you can have delivering digital products to the marketplace can yield limitless possibilites.
I started The List Guys in 2020. It is a data and skiptracing service. We provide seller and buyers list nationwide. My clients have been getting great results and I am proud to help people killing it.
I started the Hive in 2021 with my partner Anthony Gaona. It is a real estate and business mastermind. It also comes with a all in one CRM, that can host unlimited websites and users.
Starting the Hivemind has been an amazing journey so far. Seeing one of our users make his 6 figure month in June 2021 leveraging our software, I know there will be plenty more to come!
Anthony Gaona
Host/ Ceo/ Speaker
Hi! I am Anthony Gaona.
I’ve been in digital marketing for almost 15 years.I grew up in construction working for my dad when I was only 12 years old. Normally we had a ton of work or no work at all so a lot of my free time was spent learning how to generate leads.
It didn’t take very long for me to master online marketing because I became absolutely obsessed with it. For the last 15 years I’ve been generating construction based leads. At first I was running the projects myself. This led to sub-contracting all of the excess projects and eventually wholesaling the leads off to other construction companies.
One day I was preparing to build a single family residence for myself. In mid December, 2018, a simple YouTube search led me to the term wholesaling and the rest is history. The plan was to use my construction background to start flipping houses. By January 1st of 2019 I launched several marketing campaigns both on and offline for real estate seller leads.
Within about 4-5 weeks I had my first real estate contract locked up. It didn’t take long for me get a land lead where I made almost a full year’s pay on a single transaction. This came from a land lead and that forever changed my life.
I ran low volume larger land deals for the first two years of my real estate career. Like anyone who has been in real estate investing for an extended period of time, I started thinking about scaling my business.
Instead of deciding to vertically integrated and start hiring I imagined a model where I would teach my real estate investing method… Read More