This episode provides a tactical update on the 32-acre Louisiana minor subdivide deal with three fully improved parcels featuring installed driveways, cleared homesites, and utilities at road. Despite premium positioning and aesthetic appeal confirmed by every site visitor, the market collapsed completely in July with zero meaningful activity across six weeks of listings—the slowest period the broker has witnessed in four years for this specific market.
Key Takeaways:
- Don’t Cut Price Into a Vacuum When the entire local market experiences a standstill rather than just your listing, price reductions offer no strategic advantage since buyers aren’t actively shopping regardless of value proposition.
- Federal Rate Cuts Won’t Help Land Financing Buyer perception that 1% federal rates will improve purchasing power is fundamentally flawed—mortgages track 10-year treasuries not federal rates, and land financing historically stays near 8% even during sub-3% home mortgage periods.
- Premium Products Win Down Markets Holding the best lots in the area with zero carrying costs (sub-$500 annual taxes) provides patience to wait out market blips since any returning activity will naturally flow to top-tier inventory first.
Listen to the full episode for the complete market intelligence gathering process and strategic decision framework when premium land faces unexpected market stalls.
(Podcast transcript below)
Welcome to Get Serious. I wanted to provide a key update on the Louisiana minor subdivide deal that we’ve been working on. Been touching on this one in various capacities over the past several months here, but very brief update for a recap. And if anybody new is listening to…
to this deal here. So this is like a roughly 32 acre property, central Louisiana that we chopped up into three parcels, roughly equal size and did pretty significant value add on it. Fully installed driveways and cleared out home sites for all three of them. And they were positioned a bit differently. So they are unique products. And so it’s like a fully turnkey setup for
residential home buyers as utilities are at the road as well. So I was really excited about this project working with the best and most knowledgeable brokerage group in the area. Everybody who’s visited the property has just said, the value add is just tremendous. It’s some of the highest aesthetic appeal.
of, you know, vacant land within the area. So definitely premium products. And we had listed one of them a bit over a month ago and almost about six weeks ago. And then we listed the other two once the final value add was done roughly three weeks ago. And there really haven’t been substantial
hits yet. So I just want to provide a kind of overview of where we’re at at the moment. Not alarmed at this at all. Again, higher price point, we’re really following the broker’s suggestion here. He’s diligent. So I just want to point that out right away here. But nevertheless, every land investor, any real estate investor would just love you’re just getting as soon as you list something just instantaneous.
offers full cash, just close quickly. Great. but yeah, that’s not always going to happen here and didn’t have unrealistic expectations in this case. and so we weren’t, you know, getting some calls or hits early on, site visits even. And so it was just, you know, a bit curious, okay, what, what’s necessarily going on and, know, chatting with the broker.
you know, check in once, twice a week, generally twice a week, at least on this property is very responsive. And, you know, his, you know, kind of breakdown is that it’s not just our properties. It’s just like, said, you know, literally as soon as, July, or, the month turned to July, it’s like their local market just, collapsed, and they weren’t,
You know, they weren’t getting like any calls for any listings, not just their brokerage, like anybody locally. They said, you know, July, it’s not always the busiest month, but usually they’re getting pretty decent movement. Plus they got, you know, solid sales through much of May and June. You’re not as high necessarily as other years. it’s slower market in general, anywhere that’s outside of the Midwest and the Northeast. that’s just, you know, typical.
At the moment just the new reality we’re working with them But he was like, yeah, this just that they were just kind of stunned and so they’re just you know scrambling Okay figuring out. All right, what? What what what what are some of the reasons behind this and so we can kind of go over them as well as our game plan going forward here And yeah, I really wanted to drill in okay, you know
If the market is kind of collapsed, like when has the last time has this happened from any recent memory in the past few years, anything like that, just so we can kind of level set when things might come back around again. You know, real estate is cyclical, right? So it’s just what do we have to work through here? And he’s like, yeah, you know, honestly, haven’t seen a collapse in activity like this in four years.
at least for this particular market. So it’s definitely an outlier recently. And, you know, as far as, you know, trying to start putting some data points together, he’s like, well, first, you know, it’s really hot out, you know, excessively. So, I mean, it’s just, it’s Louisiana, right? So middle of summer, it’s not too unexpected yet. Nevertheless, you can have even more intense heat waves, even, you know, more so than locals are comfortable.
dealing with, you know, I’m here in central Texas, even though like this summer and last summer have been kind of middle of the road. When it comes to summers, like, you know, not that really hasn’t passed a hundred degrees, fortunately here, but like it’s still super hot. Like no, no one is really going out or I’m not going out like middle of the day. You pretty much, you know, stay inside other than, you know, mornings and evenings. So that that’s not too unusual for the.
the southern states and we did have another property in Arkansas last year that was in a similar situation where you know there were a number that’s another case study to look at but you know there were some weeks that the temperature was just super hot and it really slowed down activity and you know we did have a good exit on that eventually but that did seem to be an impact plus you know in this area of Louisiana
Again, you really can’t control what your buyer pool might be thinking, but the broker was just conveying, hey, like, a lot of these buyers kind of talking about, or at least some of the local chatter. I’m not sure where exactly it’s being picked up, but the broker has his ears to the ground. There’s no doubt about that. Hearing from the federal perspective.
Trump saying that putting pressure on Powell and going to like collapse federal interest rates down to 1%. So that gets people excited. like, maybe I can just have better financing. you know, I purchasing power is just going to increase. We’ll just wait for that. And, you know, we don’t we can’t necessarily predict precisely if or when that might happen, but
And that’s the thing, we can’t control what our buyer pool might actually think. But in terms of, is that precisely how that would go down when it comes to borrowing rates for real estate? Like that’s really not the case because mortgages tend to follow the 10-year treasury market much more. Like the federal interest rate, it’s really tied to short term.
performance. And it really only relates to bank to bank lending, like that doesn’t actually touch the consumer side. So that’s why mortgages, even though most mortgages tend to be for 30 years, most people aren’t staying in their house necessarily for 30 years. That’s why it tends to follow the 10 year bond market much more so than that. And we saw an example where
We have like 100 basis point cut over a little over the past year and mortgage rates actually went up. So that wasn’t necessarily correlated to what the federal interest rate was. And if federal interest rates are cut to 1 % here, it’s a very high likelihood that that would be perceived by
mortgagers, and potential potentially, bond market buyers that the economy is in rougher shape than, and, there’s more inherent long-term risk, that mortgage rates may actually go up plus land just tends to be, you know, more stable when it comes to financing rates as well. Anyway, like even when financing rates were super low, you know, and people were buying, you know, the
sub 3 % mortgages for homes in 2020, 2021, land still tended to be closer to like 8-ish percent anyway. So it’s just, it’s a little unrealistic for folks to think that their purchasing power is going to increase even if federal rate changes. But again, we’re not out there changing people’s mind, talking to these buyers. You kind of have to meet your buyers where they’re at. if they
you know, have a hypothesis and they perceive things to be that way based on whatever news they’re consuming. that like, we just have to work with that. Right. But that was another thing that came up here. My perception too is just, you know, again, just the general real estate slowdown that’s happened through much of the South. Like it’s possible, Hey, like the timing we’re just getting, you know, true bottom up.
information like being in the market here where, you know, again, prices have just been high in general. There’s uncertainty within the market. People are seeing other reports and, you know, no surprise here too, like, okay, the rise of AI, people are worried about their job security as well. Still how tariffs might impact pricing for any other, you
consumer level products and so forth. So all of that can still be playing into potential fears of buying into additional real estate. And I was even seeing a report today, Redfin was showing this spring, selling season specifically for houses was the slowest in 13 years in terms of actual properties going under contract.
And yeah, like a really, this is worth another podcast, but it’s just, you know, a huge decline over the past three years. Well, 2023, 2024, we’re all slow too. But 2025 even follows that downward trend here. So we just have less activity within the market. So we have to account for that as well. And
Okay. So those are all noted as potential avenues here, but then, okay, what more can we kind of glean and information that we can gather here? You obviously our brokers, like they’re super incentivized to figure this out, right? Their livelihood depends on an active real estate market. So there it is heads down. Okay. What, what, can we do? So, you know, our broker reached out to a local appraiser who usually tends to be even further up the chain as far as, um,
uh, where activity is because, you know, lenders will hire her prior to closings happening. So she’ll usually get kind of first information, um, you know, based on how busy her business is for assessing potential sales that are going to happen. Um, that can kind of indicate where activity is within the real estate market. And, know, it’s pretty sappy little data point there. So he reached out to her and was like, yeah, yeah, no, it’s definitely slower.
Um, at the moment here, you know, we’ll see when it potentially picks back up. Um, uh, again, uh, and, um, we also tried just reaching out to developers both to see if we could sell some of these lots, if any of them to developers themselves haven’t got calls back yet. Cause a of them are busy. they, they never trying to sell product to them, but you know, it also can kind of inquire, okay, how is your business looking? Um,
in so far as your final activity on the Dispo side, getting even more of an idea of what the buyer pool might look like from the final end product perspective as well. So we’re still trying to figure out that. Plus our broker’s trying to reach out to other brokers who are
you know, in other parts of Louisiana or might have kind of a wider circle that they operate in. So you can kind of get a sense of this, more hyperlocal or is it, you know, affecting most of the state overall? I mean, we, we know like it’s impacted like a lot, like we, see the hard data. see the soft data. Like, yeah, it’s just in general a bit tougher. So we’re just trying to really assess, okay, where are we at here? And it’s not necessarily a pricing thing too. This is, this is the key thing is that.
Okay, if you’re in a market where it’s just kind of at a standstill here, it doesn’t make sense to cut price into a vacuum, right? Because you’re not really serving yourself. You’re just like, you know, shooting yourself in the foot because you’re not going to get the price you want. And the buyers aren’t necessarily looking at the moment either. Plus we know a lot of folks are on vacation in July, you know, before school starts coming back around in the next couple of weeks or so.
It’s not necessarily around as much either, especially for kind of residential lots that would probably be more oriented to families as well. So that’s just something else that we have to keep in mind by taking all of these data points together and we have all of our online activity as well here. And it’s still pretty solid. We have both the land.com. There’s still a bit of a…
web glitch with list tracks kind of collecting the MLS data besides one of the lots, but one of the lots that we had tested the market and then we did initial price cut on that had a bigger bump in activity. Like the three days after we had cut the price, then it kind of stabilized a bit. So we know, you know, it got some activity, but not necessarily driving, you know, real site visits or calls there. But very fortunately, because, know, to me, it’s always like,
Okay, the hard data, who’s actually calling and potentially visiting these slots. So we do have a site visit with a client coming up this week. Actually, I’m pre-recording this a little bit, so we’ll probably have to report on that after what the result of that is. But to me, okay, even now in this pause within that local real estate market, we’re still getting at least a site visit there.
And again, the number one thing we have to kind of keep in mind here is that, you know, as the broker keeps saying, and anybody who’s viewed these lots, like, Hey, this, this is the best product in the area. So, you know, if there’s going to be any activity that comes up, yeah, we might have to be more patient for it. like these are the best lots, like this is the cream of the crop. So that’s always where you want to be positioned and, you know, more down cycles are just softer.
Markets in general because you you want to have the most appealing product for any of those potential buyers that might come around plus You know the potential room to negotiate accordingly there and Yeah, you know we have investors involved in this deal, and you know they signed on for the long run here plus we have like no Carrying costs on this deal you know probably be below a few hundred bucks a year
to pay off property taxes for this deal here. So there’s not tremendous amount of burn when it comes to it besides the preference that we have to pay to investors that can impact returns if it takes a while to sell. it’s like, hey, we’re gonna be patient through more of a blip in the market, even if it lasts a few months, even a quarter, maybe even two quarters, I know paying attention to some home builders.
When they think things might start to pick up again and you know work through some existing inventory It is well here. So We can kind of keep that in mind but you know our broker just like yeah looking at all this info people I’ve talked to you like yeah, we’re still positioned well here Not not concerned that that you guys won’t be able to get a solid exit. It’s just you know
It’s not gonna happen at the drop of the dime here. So just wanted to give you all an update on how things are going with that particular project and the information we’re collecting, what our decision-making might look like here. And you’re just trying to collect from every avenue possible, right? Get in front of the right eyeballs and not just rush to judgements. So.
Hopefully this is helpful for other projects you guys might be working on as well here. Excited to deliver more to you all shortly. Hopefully we’re going to be under contract with at least one of them. Not too long from now, but we’ll sit tight until the meantime. So with that in mind, Serious Land.Capital for any of your funding needs. 50K minimum purchase price, 150K plus preferred. And then…
Zero cost review of your land deals at Land Daily Diligence Facebook group and then landpricer.ai for the most reliable land pricing tool on the market. Subscribe and share everybody. Looking forward to talking to you next time. Take care, bye.
