In this episode, Illinois ranking as the highest-projected appreciation state for the next 12 months contradicted on-the-ground broker intelligence from southern Illinois markets. The disconnect between macro Northeast/Midwest resilience narratives and local broker feedback that “a year ago we could hit $6K/acre all day, now I’m not confident at $5K” reinforced real estate’s fundamental hyperlocal nature.
Key Takeaways:
- Top-Down State Rankings Mislead Deal Assessment Illinois leading all states in projected appreciation didn’t prevent southern Illinois brokers from reporting significantly weaker rural land markets than 12 months prior—macro trends fail at county/zip code granularity.
- Honest Brokers Sacrifice Short-Term Commissions The most valuable broker relationships come from those who admit “I can’t confidently estimate timeline or price here” rather than overselling capabilities—long-term reputation trumps single deal incentives for quality operators.
- Narrative Reversals Happen Fast Illinois transformed from worst migration state to #1 appreciation leader in just 3-4 years, yet hyperlocal markets can move opposite to state-level trends depending on property taxes, local employment, and micro-supply factors.
Listen to the full episode for the detailed breakdown of how bottom-up market analysis must override even the loudest macro narratives to avoid capital deployment mistakes.
(Podcast transcript below)
Welcome to Get Serious. Today’s episode wanted to share more of a reminder on, again, just the golden rule that we oftentimes forget as real estate operators is just how hyperlocal real estate is and that it generally pays better to focus on bottom-up data points versus top-down, even though the top-down one.
tend to be most widely reported on and the loudest piercing through even the mainstream. So an example of that is that we were looking at a rural property in southern Illinois. My home state grew up in northern part of Illinois, this one much further south and far more rural.
That’s the thing is they have pretty much anything outside of the Chicago land area. It’s just like super rural area. Within the remainder of the state here. And so this was a fairly borderline deal, you know, maybe a, you know, just under 60 K purchase and potentially could sell for a double there. But, know, we were
trying to contact the realtor and that this had like a pretty tight closing date. I’m trying to extend that out further. We were brought in kind of late for this one because another funding partner bailed out of the deal. Capital is tied up again. We get a lot of folks who have reached out or deals saved because of other funders.
have just failed to close. And again, that’s just a story for another time too. And for this one, when you’re chatting with the broker, very knowledgeable, younger guy. And again, I always appreciate the brokers who, you know, they’re incentivized to win our business, right? But the ones who, you know,
really take pride in their review and analysis of the market and are just not trying to BSU. you know, because I think they realize too that, or at least the good ones do realize that longer term reputation matters more. And so even if they don’t move forward or you don’t move forward on a current deal with them, if they provide valuable analysis, you know, you could reach out to them next time around or potentially bring in a lot other
Deals going forward so That’s the proper way to do business. Not everybody operates that way, but we certainly appreciate it When we get honest reviews like that, you know, this guy’s saying hey, you know, it’s been like a year ago If you would have asked me this Could have been pretty interesting. You know, we’re buying it at I don’t know roughly 2,600 an acre and
Ideally, we would like to see a relatively conservative exit of hopefully around 5,500 an acre. And we were seeing comps that seemed to justify that, maybe even a little bit higher based on the characteristics of the property. But then the broker was more like, yeah, potentially you could get that, but he’d feel more confident at that 5K per acre number, maybe even a bit below that. And he was just saying, yeah, I mean,
All day we could have hit five five six K a year ago Now it’s just been a tougher market as of this year just you know, yeah, I’m kind of continued pressure from interest rates and I guess taxes higher. I know Illinois’s a high tax State for properties and disincon income taxes high tax all around
And so he’s just like, yeah, I’m really not confident I can give you a a great estimate here both on how long it’s gonna take to sell this property, we should know a lot within the first seven days. And even though like the characteristics are solid here, like it’s just, it’s been relatively slow, there’s just not a tremendous buyer pool right here. So again, when you really hear that honest opinion from brokers, I get
It’s obviously helpful since we leverage them so much since we operate nationally. We’re not local to any of these areas. Pretty much any time we consider properties, even if I was doing something in Austin, would still be considering a local realtors perspective on a deal and virtually any case.
You know, that made us more hesitant and like that, that’s the thing with Bert. Like I just grill and grill and grill about downside protected, tested protection. Like, there’s almost no way we would lose money on the deal. Pretty much 0 % chance of that. But like, is it worth, you know, investing the funds from the opportunity cost perspective that might be tied up for a bit and just like not have the margin that we’re typically looking for. So in that case, it’s like, okay, can we renegotiate?
a better deal here to see like if we’re able to work it out. But a key thing with all this in mind, like I prefaced this just to show again, like our kind of strategy for diving in and how we work with brokers. And again, we’ve been doing this long time. So it’s like, it’s easier for our professionalism and just knowledge of how to operate within the land space.
to quickly get brokers attention because they know we’re legit even from a first phone call and more likely to just, again, because we can probably smell BS earlier than anybody else and they probably appreciate folks who can talk and jargon. Regardless there, and, you know,
again, just kind of getting to the root of the matter here. But in relation to my first point, and I know I’ve talked about this, plus this is like enter the mainstream, right? Or, you know, this bottom up versus top down approach, we’re like, okay, the narrative has changed more where, you know, in general, the southern part of the US, western part of the US, decent chunk of the East Coast, you know, especially
You know, North Carolina on downward has been feeling downward pricing pressure, particularly from homes, but, you know, land is correlated with homes for the most part. And, know, the more resilient areas of the country that are having more appreciation, especially from a housing perspective is the Midwest and the Northeast. Part of that has to do with, you know, just tougher zoning regulations, tougher to get billing approved. There’s just less available.
inventory to work with, not as many builders are operating up there, or just less kind of land to work with as well as actually in some of these smaller states, a whole bunch of other factors like the return to work, et cetera, too. Plus, the South and the West started becoming a bit more unaffordable as well, so that just decreased migration rates as well.
You know, as we’ve updated our focus to like, you know, have a higher spotlight or a brighter spotlight on the Midwest and Northeast regions of the country with this in mind. You know, that’s when I was like fairly excited. Okay. You know, Illinois here, this could be a little bit more of resilient market. And in fact, out of all the states from the data that I’ve seen, you know, from housing, at least.
Illinois is expected to appreciate the most over the next 12 months. So it’s like a complete reversal again from like, you know, three to four years ago when it was, you know, maybe the worst state or facing the largest migration out of it. it’s just, you know, crazy how fast things can turn. But, you know, like I just kind of alluded to and, you know, directly
kind of quoted, you this broker is just saying, yeah, this has just been a tougher market in at least that part of Illinois, and he operates across like much of the south, the larger brokerage down there. And he’s quoting kind of the property taxes and interest rates and that, you know, just wasn’t feeling as confident that last year’s market was better. And who knows how long things might take to kind of play out and improve down there. that is kind of a
Conclusion to arrive at here is that, okay, we can take these macro top-down perspectives that can relatively start guiding some of our decision-making, but ultimately it matters on a county by county, zip code by zip code, even street by street level for what true pricing is for the underlying asset. And so I just found that to be a very valuable.
data point because it went against my assumptions for areas of the country that seem to be having the opposite narrative recently. So just keep that in mind. Again, core takeaway, real estate is hyper local. Never forget that. Otherwise you stand a much higher chance of losing money, which is not what we want to do.
So all of that in mind here, SeriousLand.Capital for any of your funding needs. Again, 50k minimum purchase price, 150k plus preferred. Land Daily Diligence Facebook group for zero cost review of your land deals. I was just on that earlier today reviewing a deal on Georgia. Low price, but pretty interesting from the variance in the market. And then LandPricer.ai for the most reliable land pricing tool on the market. Should have the testable product.
ready tomorrow for my engineering or our engineering team rather. Looking forward to that as well. Subscribe and share. Take care everybody. Talk to you tomorrow. Bye.
