How Justin Artis Made $250K by Understanding Zoning and Land Value

Justin (00:00)

Minimum lot size is 30,000 square feet. But we zoned it to R2, which is still allows for mobile homes, but it has a clause at the bottom of the zoning code that says, hey, if there’s city water, are their city sewer at the main road, you can bring that in and now you can reduce the minimum lot size to 14,000 square feet. So, you know, somebody missed that somewhere. But I knew that kind of going in. we, and that they were city water, because we could see the fire hydrants along the road, right? So rezoning is a six month process, but you know, that’s fine. We bought it, rezoned it, brought in the city water line, subdivided it, and then.

Remember, we basically got this house and that half acre land for free, essentially, because we just, and then we put probably 120, 130 into the house. I would assume we still have it. We never sold it. We never even got an appraisal, but I’ll assume it’s worth 400 to 375 somewhere in there. So we probably made about 250 just by understanding the zoning and what you can and can’t do.

Michelle Tack (00:55)

Welcome to Real Estate Pros podcast. am the podcast leader, Michelle Tack, and we have a great operator here today. Justin, can you just give a shout out?

Justin (02:43)

Hey, good morning everyone. I am Justin Artis.

Michelle Tack (02:45)

Justin, thank you. Justin Artis and I have been preparing for the podcast and I’m excited really to have him on board with the podcast today. One of Justin’s strengths is in terms of having a vertical business that he’ll explain in a little bit of his, you know, getting access to information, but he really specializes in

both mobile homes as well as getting 10 properties for revenue and is looking to achieve that shortly here. So there’s a lot to unpack there, but Justin, thanks so much for joining us. For those that are not, in the world that you are in, that are listening to this podcast today,

Can you talk about ⁓ your business, what you do, and where you do it in terms of what markets ⁓ and who you serve, please?

Justin (03:52)

Yes, yes, man. So I am in the Charleston, South Carolina area, mostly the kind of Tri County area around Charleston. And we do a lot of real estate, we do, you

We do flips and we got a property management company and but what we primarily do and what we happen getting into is mobile home land home packages. So that’s basically buying some land where there’s vacant are already kind of clear. We’re getting utilities, placing a brand new manufactured home and then selling that off to a end user with typically FHA or VA financing.

Michelle Tack (04:26)

And you’re doing that mainly in South Carolina now, is that correct? Or do you have plans to expand?

Justin (04:30)

Right?

No, I don’t really have any plans to expand at this point. I know there are some folks out there that are kind of doing that going nationally, but ⁓ I kind of wanted to stay small and local at this time.

Michelle Tack (05:29)

One of the things, again, our pre meeting that really impressed me was that vertical nature of your business. And by explanation that your mom is a realtor and can give you some MLS information. ⁓ also, you know, you have the properties that you want to buy, but you also have the mobile home, you know, packages. You attend different events and

It sounds to me that you know exactly what you want to do. You’re exercising that. And can you tell me in your own words, not mine, what keeps your business a well-oiled machine as it were? There’s always room for improvement, we know. But can you talk to that and help those folks on the podcast understand that?

Justin (06:12)

Yeah,

think it’s two things. One is you kind of mentioned it knowing what we are aspiring for and kind of backtracking into what we need to be doing to accomplish that, which is essentially, and you kind of mentioned it, our goal is to have 10 properties paid off that generates around $25,000 a month so that we can live a financially free life.

Right. that that’s our goal. So the question is, how do you get that? You can do BRRRRs and buy rentals and then refinance out to get your money back and then have someone pay those off for 30 years. So that is an option, but we kind of want the financial freedom now. So we are like, well, what can we what are some income, big income generating activities we can do to then go purchase homes? So that is that is kind of what we were doing with the land home packages. And then the other thing is just

I think we have some pretty good systems in place in organization to keep things flowing well, making sure we’re following up with people and all the things like that, the systems in place to make us efficient.

Michelle Tack (07:18)

That’s great. and, well done by the way, you know, every operator that I’ve talked to and, we know regardless of what segment of the real estate business you’re in has had an experience of where something went sideways and you had a pivot pretty quickly to resolve that situation or it was an opportunity for you to learn.

Can you talk about a situation like that please that you have had in the last year or maybe it’s two years, but just something that you could relate to?

Justin (07:50)

The end.

Yeah, I would say. So luckily we haven’t had any disastrous deals so far and I’m not on wood for that, but but I would say. One deal I’m thinking of and it turned out great for us, but it it made us pivot a little bit and I had to learn a little bit was we when my mom was going through military school, she had a classmate or friend that was selling a little piece of property. She had kind of further out in the country. It was like an acre had an older house on it and.

They just wanted to get rid of it. So I think we paid like 35,000 for it. So pretty, pretty cheap. So the plan was to kind of renovate the home and rent it, you know, cause that’s kind of what our strategy was back then. But the home ended up not being, the foundation was bad and stuff like that. So we ended up tearing it down. So, you know, we’d had to kind of repib it with what we wanted to do with the land. But what that did though was in the parts we bought it at was low enough that, you know,

Michelle Tack (08:27)

Mm-hmm.

Justin (08:50)

allowed us and this was in the beginning of our investing stage I’ll say so we know we’re still kind of running in circles but it allowed us to like really get into zoning which I can come talk about later is I’m super big into zoning and how you can manipulate zoning to create value ⁓ and that is kind of the start of how all that happened by really diving into hey what can we do with this land that’s now vacant doesn’t have the homeowner anymore.

Michelle Tack (09:16)

That’s great. What’s the next big goal for you as you go forward and think about the next year, et cetera? What again, impressed me about when we started talking, you were very specific about your goals and you had great focus, which is obviously a leading indicator of success, not just in your business, but others. So can you talk about, maybe you have some milestones you’re trying to reach, what have you? I don’t know what those are. If you could chat about that, that’d be awesome.

Justin (09:28)

Right.

Yeah,

think the milestones for us are starting to pull ourselves out of the weeds of the business and we’re starting to generate enough income and revenue to put people in place, know, trying to find a place to put in place to kind of run that. And now we’re we’re managing the people who vice actually managing the deals. So.

That is one of our big goals and kind of what we’re doing. have hired one person so far and that has worked out well and looking to hire one more person here soon.

Michelle Tack (10:47)

That’s great. Obviously that is an opportunity for growth, but it’s also, know, right now things are got a lot of things working together, right? You’ve got the mobile piece, you’ve got your land, your, you know, housing piece, right? You’re trying to get to that 25 K a month. You had mentioned your, one of the things you’re trying to go from more passive, from passive to active income. That obviously is something that

Justin (11:10)

You

Michelle Tack (11:16)

requires a lot of people involved, which makes me think about something that we didn’t discuss before is your network. Can you talk to you about what you use as a network? And it doesn’t have to be a traditional one. It could be whatever you think. It could be a group of athletes that get together. had a professional athlete, ex-professional athlete tell me that his was athletes. Can you tell me about

Justin (11:25)

Mm-hmm. Mm-hmm. Mm-hmm.

Michelle Tack (11:45)

your network and how it contributes to your business. You the top portion of your network and how you keep in touch.

Justin (11:50)

Yeah, I would say.

Yes, 22 groups. So I I did go to the Naval Academy so class of 2018. I appreciate it. Yeah, so that’s how I ended up in Charleston. Actually all sudden readers should have most part come through Charleston for schooling. Then I met my wife here and all that. But regardless of that so. There’s another realtor in town that is.

Michelle Tack (11:58)

congratulations. That’s awesome.

Justin (12:13)

He does a lot of buying and selling for military people. so, and that’s kind of why we started a property management business. Because when I was working here on my short tour, as a lot of people were leaving the Navy or like transitioning, everyone knew me as the real estate guy. So they were like, hey, you want to manage my home. So it just kind of started managing people’s homes. And then that kind of, and I wasn’t even actively trying to do that, but.

it just kind of kept happening. So I was like, let’s lean into that. Right. we, so, got all the stuff in order and now we’re at like, it’s like 65 homes and probably another 15 onboarding care soon. So, so that’s one network, the military folks coming through. And then the other one is the REI event that I kind of talked about, ⁓ going there, Charleston, I guess I’ve never been in other areas for REI events, but the one in Charleston really seems very wholesome. A lot of people that just, you know, like a of people,

Michelle Tack (12:51)

That’s cool.

Mm-hmm.

Justin (13:08)

And a lot of those folks have kind of gone through me to buy homes and I’m them set them up and stuff like that. And so that has been a huge network for us as well.

Michelle Tack (13:17)

Yeah,

I really want to stress this theme for those are listening. You know, in terms of networks to think outside the box, it could be I had a gentleman that is very much into his alumni and uses that some are ex corporate people that they still stay in touch. It doesn’t always have to be the traditional element.

Justin (13:38)

you

Michelle Tack (13:41)

And I live in DC area, we call it the DMV, and I certainly understand the value of the military and how women and men, know, profit and stay together by being of service to our country. So thank you for that. Before we close, can you talk, you wanted to talk on the zoning a little bit more. Do you want to bring that up before we close today?

Justin (13:54)

Yeah.

Yeah, so I was going to talk about my probably best real estate deal to date. And it has a lot to do with zoning. So like I said, we had that one land out and kind of further out, and that’s where I kind of started getting into it. So understanding a little bit. then so we threw a real estate

Michelle Tack (14:10)

Great, go ahead.

Justin (14:23)

The brokerage next door to my mom, they knew we were in real estate, so she had a listing coming up and she notified us about it. So it was basically one acre and it had two homes on it actually. There was a, not that it really mattered, but it was like a mobile home that the folks were living in. And then on the other side of the property was an old home, stick built that they were renovating. So it’s completely gutted, basically a shell of a home, but he was working on it himself.

So I think they kind of got tired of he was doing it by himself and it was kind of going slow and they were there for a few years. So they were looking at this move and figure something else out. They originally wanted like 400,000 for this home, which is probably what it was worth. But the problem was that house was technically not worth anything to a bank from an appraiser standpoint because it was just a shell of a house. So we knew we couldn’t pay that. A couple of months went by and then the realtor reaches back out and say, hey, we just got an appraisal. came back at 250.

And so we’re like, perfect, we offer 242 and then we close the deal. So that 242 is basically the value for the one acre itself and the mobile home over here on the left. The house on the right, we started renovating. Now what the owners were trying to do, where they were trying to subdivide that into two half acre lots. So when they went to like the county council, or not the county council, like planning and zoning, they were like, hey, you can’t do that based on the zoning.

But what they didn’t, guess, or what the planning has only failed to realize to tell the people is you actually can do that. It’s just a process you have to rezone it. So, know, R2RF was the zoning it was. It’s just, it’s like residential two for manufactured home, rural farm animals.

Minimum lot size is 30,000 square feet. But we zoned it to R2, which is still allows for mobile homes, but it has a clause at the bottom of the zoning code that says, hey, if there’s city water,

are their city sewer at the main road, you can bring that in and now you can reduce the minimum lot size to 14,000 square feet. So, you know, somebody missed that somewhere. But I knew that kind of going in. we, and that they were city water, because we could see the fire hydrants along the road, right? So rezoning is a six month process, but you know, that’s fine. We bought it, rezoned it, brought in the city water line, subdivided it, and then.

Michelle Tack (17:05)

Yeah. Mm-hmm.

Yep.

Justin (17:22)

Remember, we basically got this house and that half acre land for free, essentially, because we just, and then we put probably 120, 130 into the house. I would assume we still have it. We never sold it. We never even got an appraisal, but I’ll assume it’s worth 400 to 375 somewhere in there. So we probably made about 250 just by understanding the zoning and what you can and can’t do.

Michelle Tack (17:37)

Well, you

That’s

Justin (17:45)

yeah.

Michelle Tack (17:45)

That’s amazing,

Justin. And that’s a good instruction for those that are listening. For those that want to get in touch with you, Justin Artis, can you provide what the best way to contact you is and the spelling so that people can write that down as they’re listening?

Justin (18:01)

Yes, ma’am. So it’ll just be my email. That’s justin.artist at yahoo.com. So that’s justin.artis@yahoo.com.

Michelle Tack (18:14)

That’s awesome. You’ve been a great guest with a lot of really good specific information, which I love. For those that are listening to this podcast and have found value of it, please subscribe. And to those that are subscription holders, thank you very much and continued success, Justin, in the future.

Justin (18:31)

I appreciate it. Thank you guys.