Real Estate Cliches Phrases and Sayings
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Jill: This Jill Dewitt for Land Academy. Welcome to our Cash Flow from Land show. In this episode, Steven and I talk about some sayings and clichés associated with real estate investment. Some are great. Some are really silly. I think this will be fun. Before we do, let’s hear a question from a caller.
Steven: If you have a question please dial 888-735-5045 and leave us your question, and if you’re an interesting person, we’ll have you on the show.
Jill: I love how you sneak that in there.
Steven: Here’s a question. Jill, Walter from Albuquerque asks, “I need cash. I need cash. Do you want to buy my land?” Oh, my gosh. I wonder how long that’s been sitting there
Jill: That’s fantastic. Yes Walter. Actually that’s not always yes.
Steven: Yeah, the answer is yes.
Jill: No. Not always. It’s got to have one of the four A’s. I have to say that.
Steven: What are the four A’s again? If you’re new to this, first of all where have you been? Second of all …
Jill: You got some catching up to do.
Steven: Jill and I gauge every piece of property we buy. Not the financial part, but just whether or not we should buy it, by what we call the four A’s. It’s something I came up with a lot of years ago. Go ahead.
Jill: I’ll tell you them all, and then I’m going to go back and we’ll go through them. They are Access, Affordability, Acreage, and Attribute. Access.
Steven: Can you get to it?
Jill: Can I get to it?
Steven: Without a helicopter?
Jill: Exactly. Is there a road? What’s the road condition like? That kind of thing. That’s important, you need to know. Affordability. That goes without saying.
Steven: The cheaper the better when it comes to real estate.
Jill: Exactly. It’s got to be the right price. Can I afford it? Does the price make sense, too, by the way? Am I buying it for something where I can try and sell it and still make a good profit.
Steven: Not are the payments affordable. Is the price affordable.
Jill: I’m paying cash.
Steven: That’s for another show. That’s right.
Jill: Exactly. Acreage. Bigger the better. You got more acreage I’m probably going to have more buyers. Last was attribute. Is there something special about it?
Steven: My favorite.
Jill: Is it just outside of something cool in Southern California? Is it in a pretty mountainous area with lots of trees? Is it by a lake?
Steven: Is it close to water, mountain views? Is it close to the Grand Canyon?
Steven: All of that.
Jill: Something people can drive to if they wanted to.
Steven: Can you build a cabin on it? Are there cabins right next to it?
Jill: Is it zoned that I could put a mobile home there, or I can put a trailer there as long as I want, kind of thing? There’s lots of things are attributes.
Steven: You want to make your property look special. When people are out on the internet looking to buy that property, you want to tell them something great about it. I’ll tell you, just as an aside, I have never owned a property that it’s okay to put a mobile on for longer than a week. They just fly.
Jill: They do.
Steven: Mobile properties are great. I don’t mean mobile home parks.
Jill: What that means is, some counties in some areas require that the properties are site built, meaning a foundation and real wall. There’s a lot more money, and time, and expense, and planning that goes into it. You can’t just roll up with whatever you have. Even a tiny house, it’s not site built. Are there some ways around that, now? I don’t know, but the majority of what we deal with that you can have a mobile home or camp out there for as long as you want is really important.
Steven: RV’s and stuff.
Jill: They love that. Cool.
Steven: This is a cool show.
Jill: I like this. You’ve put a lot into this Steven. I appreciate that. I’m starting quite a list of clichés. I started to go through and pick out some of my favorites.
Steven: How this started is I got accused recently of saying certain stuff over and over again. It was by one of our staff. I don’t know if they meant I say stuff too often or if I overuse it, so I decided to do a show about it that came out this way.
Jill: I have a cliché that I know that actually didn’t make the list. I’ll bring it up at the end.
Steven: I want to bring them up and you say yes or no. Some of them are silly. Some of them I think are really, really important.
Jill: See if I agree or not agree?
Jill: All right.
Steven: Cash is king.
Steven: I think so too.
Jill: Totally agree with that.
Steven: I think that applies to a lot of things. I’ve heard this saying, when you’re in a bidding situation to buy a house, which we’re not single family residents or investors except for ours. For a lot of reasons taking an offer that’s exact same on a number when it’s financed versus just cash is there’s a lot of reasons it’s in cash. You just can’t get hurt.
Jill: For the seller, cash means we know they can afford it. It’s not going to fall through.
Steven: Right. That’s a good point.
Jill: I can close in two weeks if I want to. I can close in ten days if I want to. It depends on what the situation is, but you can usually close a lot faster. I don’t have to appeal to a bank. I’m not going to worry that it’s not going to appraise for what we want. It doesn’t matter. It’s cash. For the buyer, I can waive things. I know the roof has issues. I know this has issues. I’m good with that. I’m going to buy it regardless. I’m paying cash. I don’t have to make anybody else happy.
Steven: That’s the single family residential version, but I think there’s a lot more to it than that. Cash is king because you just can’t get hurt. If you’re paying the right price for a piece of property, it’s not a hundred percent guaranteed, but the economy could crash. All kinds of stuff. Not just the house, anything, an apartment building. If you pay cash for an apartment building, and the economy crashes you can began to lower your rent for example and make sure it stays full.
Jill: That’s true.
Steven: Cash is control. Let’s say it that way. It’s not king, it’s control. I like that. I’m going to write that down. Cash is control.
Jill: That is very good. Cash is control. Give me another one.
Steven: Location, location, location.
Jill: Yeah, that’s true.
Steven: I love this, this little thing. This is the three rules of real estate.
Jill: It’s been overused.
Steven: You have some super new people that listen to this that are very young. Maybe they’ve never heard that. Don’t buy into the whole thing but …
Jill: Don’t overspend.
Steven: It’s another way of saying our attribute. The four A’s. It’s an attribute thing.
Jill: Don’t let someone trick you into something because they’re telling you it’s the greatest location, too. You need to confirm that. This is what’s coming in across the street.
Steven: Yeah, be careful of that.
Jill: Right. Confirm that.
Steven: Don’t wait to buy real estate. Buy real estate and wait. I’ll let you answer that.
Jill: That’s dumb.
Steven: That’s an excuse for paying too much.
Jill: Isn’t it dumb?
Steven: That’s an excuse for negotiating a bad deal. Jill, you and I are on the same page on a lot of that stuff.
Jill: That’s really dumb. I got one. Can I bring it?
Jill: Buy land. They’re not making it any more. What do you think about that one?
Steven: Oh my gosh. You go first. This cracks me up.
Jill: Actually they are. We talked about that in another podcast, but that’s a whole aside thing.
Steven: We did a whole show on this.
Jill: We did.
Steven: I mean a whole weekly call with our pro members, and we were all laughing about it.
Jill: We did.
Steven: They are making more real estate, and here’s how, it’s called sub-dividing.
Steven: Are they making more land in Manhattan? Yes.
Steven: They’re building up.
Jill: That’s true.
Steven: They’re buying air rights.
Jill: Do you know what they’re doing too? Not only that. How about that it used to be the newspaper whatever plant. Not now. Now it’s all multi-unit apartment complex, and they’re selling them. They probably have all different APNs, assessor’s parcel numbers. That sounds like making more land to me.
Steven: Whoever came up with that saying. Actually it says right here who came up with it. It was a writer, Mark Twain was talking about farms and agriculture. That’s the only place where that applies in my opinion. Any other use besides agriculture, and I would even now argue, because of the way crops are done so efficiently, through photosynthesis, and I don’t want to get into it, but synthetic photosynthesis is 100% efficient. I’m sorry Jill.
Jill: What are you talking about?
Steven: I knew I was going to get busted for that.
Jill: What is this? I’m waiting for a Walter White quote and you come up with photosynthesis?
Steven: Jill called me a brainiac at lunch today. “Hey brainiac.” Is that a compliment or not?
Jill: Mm, depends on the-
Steven: No it wasn’t. That means no. That’s Jill’s way of saying no.
Jill: It’s like, “What are you talking about?” Seriously.
Steven: You can grow stuff indoors on a huge scale.
Jill: I saw The Martian. I know this.
Steven: Oh my God. If you find yourself in a relationship with somebody from southern California, call me. I have a lot of advice.
Jill: Thanks a lot.
Steven: You’re in for the ride of your life. You better have a lot of conversations with yourself.
Jill: What? That sounds like a cliché.
Steven: Self educate. Believe me.
Steven: All right. Back to the thing.
Jill: Okay. How about … some of these are painful. It really is. Give me another one.
Steven: If you move on, there’s a bunch of quotes in here that I threw in here for fun that Warren Buffet says, just about investment.
Jill: Oh, is that where that came from?
Jill: Okay, got it.
Steven: Here’s one of my favorite Warren Buffet quotes, “The biggest mistakes I’ve made financially, in my life, were when I had a pocket full of cash.” I absolutely agree with that.
Steven: Yeah. You tend to scrutinize stuff when you’re only, if you have a $5,000 a month budget to buy land, you tend to really spend it wisely, but if you have a $500 million dollar budget, like somebody I know, I’m exaggerating, actually I’m referring to myself.
Steven: Yeah, if you have a bazillion dollars you tend to maybe not look at stuff as closely. I’m very guilty of that. Jill, you’re not.
Jill: I’m not.
Steven: You’re in this budget.
Jill: I scrutinize.
Steven: Yeah, you really do. Maybe that might be a man/woman thing.
Jill: You know why? I’m going for the spread. I’m all about that. I want to make sure I buy it right and I’m not going to lose. What’s another? These are Warren Buffet ones.
Steven: Here’s another Warren Buffet one. I love it.
Steven: “I’ll tell you how to become rich. Close the doors, and be fearful when others are greedy, and be greedy when others are fearful.” That makes a lot of sense.
Jill: I like that.
Steven: Here’s another one that’s my favorite actually, one of my favorite Warren Buffet quotes. “Risk comes from not knowing what you’re doing.”
Jill: Oh yeah.
Steven: In our world, it comes from not knowing where you’re going to sell the property before you buy it.
Jill: Mm-hmm (affirmative). I agree. Can I jump in here?
Steven: Yeah please.
Jill: This one sang to me, because this is really good. This is how I operate. “Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good results.” Huh, gee, that kind of sounds like us, doesn’t it?
Steven: It does, yeah.
Jill: You win when you but it, period. That’s what it is. That’s what that saying to me, don’t count on the sale, that’s not going to save you. You buy it right, you’re going to do just fine.
Steven: I’m paraphrasing. Here’s another one. “Everything’s got to work on paper first, before it works in reality.” That’s true in everything man, engineering, everything. You can’t, Jill and I differ a little on this. I research everything. I research what kind of paper towels to buy. It’s really kind of sad.
Jill: Yeah, you do.
Steven: It has to all work in a big, huge system for me before it ever, and real estate’s no different.
Jill: Mm-hmm (affirmative).
Steven: You got another one, a good one?
Jill: It’s interesting. It’s a little bit longer one he says. He says, “The most important quality for an investor is temperament, not intellect. You need a temperament that neither derives great pleasure from being with the crowd or against the crowd,” which it shows that they put the translation as-
Steven: Beat to your own drummer.
Jill: Yeah, don’t worry what the masses are doing, and you know, I agree with that. Do you agree with that?
Steven: Yeah, completely.
Steven: Yeah. You’re almost always, if you go against the crowd, you’re almost always right.
Jill: Mm-hmm (affirmative).
Steven: You have to put the variables resources. When everybody’s filing bankruptcy like they did in 2000 and whatever it was, nine or eleven, or I don’t remember, you had a ton of piles of cash saved up like we did, buy a ton of assets. That’s completely going against the whole thing.
Jill: Mm-hmm (affirmative), exactly. Here’s a good one. I don’t know if you read this one.
Steven: Yeah, go ahead.
Jill: Number ten there, “A public opinion poll is no substitute for thought.”
Steven: Yeah. I love that saying.
Jill: Boy, that’s a good one.
Steven: That’s kind of what we just said.
Jill: Did we say that one?
Steven: Yeah, I mean it’s you don’t have, decide what works for you.
Steven: Education is supposed to, somebody told me this a long time ago, you’re not supposed to get all As. Education is really-
Jill: What? Wait, but that’s the only way to get the-
Steven: Education is supposed to, you’re supposed to find out through an education process what you’re interested in. If you’re really good at math, you’re going to get As in math. Maybe you’re not as good at English.
Steven: Maybe you like shop, that’s your thing. That’s what that’s for.
Jill: It’s true. Get a good feel for all kinds of different things.
Jill: I agree.
Steven: I like this balance sheet one. It’s a little bit technical, but what the hell? I’m a brainiac. “We reject interesting opportunities, rather than over leveraging our balance sheet.” What that’s saying is, it’s a different version of what we just said. Is this boring as hell?
Jill: No, no. It’s all good. Just kidding. No, it’s interesting.
Steven: Just kidding? Just kidding. No it’s not. It’s boring as hell.
Jill: Well, it’s getting a little dry. How about some of our own clichés, because I’ve got one.
Steven: Go ahead.
Jill: Okay. One of my clichés is, which I think it’s funny. It’s the drive until you qualify. I do like that.
Steven: I love that. Explain it.
Jill: You have a limited budget, and you want to be at the beach, and you can’t afford the beach, you just keep driving until you can afford it, and that’s where you’re going to live.
Steven: That’s true with some of our dirt too.
Jill: You know, that’s true. You’re right. Some, they can’t afford this, you want 40 acres. You can’t afford 40 acres here, but you can afford 40 acres there. Absolutely. Same thing. What’s one of your favorite clichés, even around the office? This is more fun. Let’s say some of our stuff.
Steven: Let me think. I don’t know. I’m drawing a blank. We should have practiced this better.
Jill: We should have asked our staff.
Steven: Yeah. I’m trying to think what those guys were saying I say all the time that cracks them up. I have a tendency to say stuff from the ’50s like lickety split.
Jill: No, no, no.
Steven: I think it annoys the hell out of certain people. I really do. Maybe you’re one of them.
Jill: Oh, I’m sure I have my own. I am sure I have my own.
Steven: Johnny on the spot. That’s what this came from, Johnny on the spot.
Jill: Oh, Johnny on the spot.
Steven: I said, “I need you to be Johnny on the spot on this thing today,” and he just looked at me like.
Jill: Did he get it?
Steven: Maybe not.
Jill: Oh. That might have been part of the problem.
Steven: Join us in another episode where Jill and I talk about your all important real estate investment in life. I don’t think I said that right.
Jill: You did just fine.
Steven: Some of those are funny, some of them aren’t.
Jill: They are. I was looking at your list, and it was funny because I could tell they went from real estate clichés to business clichés, and I went, “I wonder how the list changed.”
Steven: It got brainy.
Jill: Yeah. You pulled in [inaudible 00:17:04] because you love Bill Gates.
Steven: Warren Buffet.
Jill: Warren Buffet, okay that too.
Steven: Okay southern California.
Jill: Warren Buffet, hey. Both are cool. I think it’s great. That was good to talk about because there’s a lot of, talking about these clichés, they were meant to be a reminder of a-
Steven: It’s just all common sense.
Jill: Yeah, and just reminding you, duh.
Steven: Yeah, duh, exactly.
Jill: That’s it.
Steven: I used to have a plaque on my desk, actually I’m going to get another one because I’m saying it all the time now, “Good acquisitions solve all problems.”
Jill: Mm-hmm (affirmative).
Steven: Somebody asked me like a month ago, it doesn’t matter, recently. It’s been asked several times over the years. “Why don’t you guys talk about sales? All you ever do is talk about acquisitions.” Here’s why. We should do a little show on this actually.
Jill: We should do a little show on this.
Steven: We just don’t have any problems selling property ever.
Jill: That’s true.
Steven: Ever, not even during the worst downturn. Not ever have we had problems selling property. We haven’t had any problems, but if we did, it would be because we didn’t do a good acquisition.
Jill: Mm-hmm (affirmative).
Steven: There’s all this land for sale all over. Have you ever noticed how much land is for sale? If you ever go on the MLS, there’s way more land for sale than houses or any other type of real estate. It’s because it’s all not price right.
Steven: You should price real estate, this irks most agents. You know?
Steven: It irks agent because … Oh here’s a good cliché, “You’re not a real seller.”
Steven: They’re right.
Steven: It’s not often that I say-
Jill: That’s kind of not nice.
Steven: It’s not often that I really side with an agent, but I hard and fast side with that. If someone says, “Oh yeah, I want to sell my house for $180,000 in $120,000 neighborhood.” It’s not really for sale.
Steven: They’re not a real seller. They’re just wasting everybody’s time.
Jill: You’re right. That was a little rough to hear at first, but you’re 100% right.
Steven: Why was it rough.
Jill: It was a little bit offensive. No, I’m just putting myself in the seller’s shoes. “You’re not a real seller,” like they’re guilting them or making them feel like the other way, but no. The way you explained it is correct.
Jill: Yeah. You’re right.
Steven: Do you talk to a lot of people like that? You talk to a million sellers a day.
Jill: I do. I never say that. I can tell you that much. No, but I do, I do. They think it’s priceless. You know what’s funny? They come out with this $10,000 price tag in their head because they think that based, I don’t know what it is. It’s a feeling that they have. That’s it.
Steven: It’s a feeling.
Jill: It’s a feeling that they have.
Steven: Maybe they need $10,000. That’s what I think.
Jill: Maybe they need $10,000, or maybe they were told years ago, “Grandpa bought it for $500. It’s going to be worth $10,000. Just wait.” That was just a guess, random, whatever, but in their head they think-
Steven: It was in the birthday card with the deed they got.
Jill: Right, when they were five, and now they’re 50, and it didn’t pan out.
Steven: “Sonny, this is like giving you $10,000.” No it’s not.
Jill: I have to kind of reel them in, and sometimes I’ll even show them, “Here’s some numbers. Here’s why. No, they didn’t build that airport there. I’m very sorry.” Didn’t happen.
Steven: Yeah. You’re right. I wrap that up by saying, “Yeah, you’re not a real seller.” Click. That’s why I fired myself from that job a long time ago.
Jill: That’s why Steven doesn’t get to talk to the customers anymore.
Steven: Now, on that perfect note, let’s go buy some property.
If you have any questions or comments, please feel free to email me directly at steve@LandAcademy.com.
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