Million Land March Theres enough to go around (CFFL 0125)     

Million Land March Theres enough to go around

Jill DeWit:
This is Jill DeWit from Land Academy. Welcome to our Cash Flow From Land Show. In this episode, Steven and I talk about how much real estate is really out there to flip. Guess what? There really is enough to go around. Steven, this is such valuable information and I know you spent a lot of time researching this. I’m going to say thank you right now, but before we get into this let’s take a question from a caller.

Jack Butala:
Sure. Hey, I’m going to read the question, okay?

Jill DeWit:
Yes.

Jack Butala:
Thinking about attending a flipper … Oh, I’m sorry. [Ernesto 00:00:38] from Los Angeles asks, “I’m thinking about attending a flipper local seminar. Good idea or bad one? The cost is around 500 bucks for the weekend.” I don’t … That’s going to be [crosstalk 00:00:50].

Jill DeWit:
That’s a tough question. I know. I have two things to say about this. I hope it’s okay if I jump in here.

Jack Butala:
Now more than ever on this question, Jill, we need to tell the truth. We really need to just … Let’s forget about being politically correct. We’re going to use rated G language, and I want you to tell me what you really think about this question, because I’m going to pull out the stops.

Jill DeWit:
I’m going to have good stuff to say and not good stuff to say.

Jack Butala:
Me too.

Jill DeWit:
My first thing would be do your homework. Make sure it’s a credible organization like they’ve been doing this for awhile and this is not all … I mean, this is what they do, not like they also do things for hair salons and all that stuff. I want you to make sure it’s the right place. I don’t think the cost is necessarily that’s out of line. I think that’s totally in line, and I also think that, Steven and I feel the same way about this, we read a lot, we’re always learning. I’m always trying to pick up something, and, gosh, you can’t go wrong with more education.

Now, I would look for red flags is my only thing to caution you. When you walk in, are they trying to get you to up your credit limit because they want to sell you something more? Are they trying to get more out of you? For me that would send a red flag, and I would probably … At the first break, I would probably not come back. That’s just little things for me. Steven, what’s your thoughts?

Jack Butala:
Jill and I, we have tons and tons and tons of members. One of the first things we ask, or during the course of our relationship we ask them how they heard about us. We are very fortunate. We’re very qualified to have this show and answer this question. A lot of the members, many of the members, tell us, “Well, I had an experience over here with this group,” or, “I had an experience with over here at this group.” It seems like you’re going to answer all the rest of the questions that I had that they started. I have put together a tiny little checklist of things that really send up red flags for me.

Number one, I would like to know who’s ever teaching anything, and that isn’t just real estate but anything, what’s their transaction history? How many deals have you done? Here’s the thing. It’s really easy to say, “Well, I did 15,000 deals.” Well, if you go on our Land Stay website they’re listed there. How much we bought them, how much we sold them for. Our transaction history is transparent. House flippers they’re going to do a lot less deals because they’re complicated, but I just really wonder what qualifies somebody to teach this stuff. It concerns me a lot, but you know me. I’m a glass half full kind of person.

Jill DeWit:
Mm-hmm (affirmative).

Jack Butala:
If it’s being held in a hotel, huge red flag for me.

Jill DeWit:
That doesn’t scare me at all because it’s convenient.

Jack Butala:
I disagree. There’s a lot places you can hold events. A library.

Jill DeWit:
We might be at a hotel.

Jack Butala:
Well, then you know what? We won’t be.

Jill DeWit:
We might be speaking at other events that are in hotels.

Jack Butala:
Yeah, Jill, I’m really going to … There’s very few things that I really put my foot down, because you’re 99 percent of the time you’re right. I think there’s a lot of places that we can … Well, you know what? If it has to end up being then I’m going to eat my words. Is it part of a local real estate investment club? That’s a good thing. Local real estate investment clubs are a great resource. They’re almost always free, or if they’re not free it’s a 100 or 200 hundred dollars sometimes annual fee. I think that’s money well spent. Most of the time, not all of the time. If you are looking for one of these clubs, make sure it’s a big one that’s been around for awhile. If it’s a tiny little one that’s cropping up and it’s really specific, I would be concerned about that.

Then, how did they reach you? If you’re considering this, [Ernesto 00:04:47] from LA, how did the fact that this thing is available reach you? Did you go out on the internet and look for it yourself? If so, that’s a good thing. Did a friend of yours already tell you about it because they went to one and they got a lot out of it and said, “Hey, you should really go do this.” That’s a good thing. Word of mouth. If they’re running a late night infomercial on CBS, one of the network stations and it’s packed full of people that said, “Hey, I had a great experience,” I would be concerned about that. I’m just being real straight, Jill. You’re shooting me looks across the studio here.

Jill DeWit:
Because I feel differently about them, but I do think you should do your homework. I don’t think where it’s held is necessarily an issue, because sometimes that’s all there is that will hold that many people. By the way, if I’m coming from out of town because I have come out of town for specific events, I appreciate that it’s in a hotel and I don’t have to travel. Haven’t you ever gone to a company event and the whole meeting is at that hotel?

Jack Butala:
Yeah.

Jill DeWit:
Thank you.

Jack Butala:
And I think that’s okay.

Jill DeWit:
It’s the same thing.

Jack Butala:
I think that’s okay if it’s a relatively closed group. It’s just stay away from the late night infomercial bikini Ferrari thing. That’s all [crosstalk 00:05:56]

Jill DeWit:
That’s the only thing. Well, I agree on that. Yeah, let’s not bash where they’re having it and all that good stuff.

Jack Butala:
Okay.

Jill DeWit:
But if the content, because that’s really not a big deal. It’s really not. It’s really what’s being delivered is the big deal, and make sure that, you’re right, they have a track record, it’s the right person, and they’re credible. Again, I still think that getting more knowledge is not bad. Even if you walked away … I’ve got to tell you, Steven. I’ve gone to things that, you probably might not agree with this, but I’ve said, “Boy, I’m so glad I went because it’s so not what I want to do.” You know what I mean?

Jack Butala:
Yeah.

Jill DeWit:
I can check that off my list.

Jack Butala:
I think 500 dollars in this case is not … If you walked out of there and said, “Boy, that’s just not it for me,” 500 dollars is well spent.

Jill DeWit:
I think that was fine.

Jack Butala:
It’s the 50,000 dollar programs that I get concerned about.

Jill DeWit:
There I agree. If it’s 500 dollars [inaudible 00:06:53] and you know they’re asking for 20, then I have a problem.

Jack Butala:
Yeah, that’s another thing. If you go to an event and they’re really up-selling, “Well, this is just the introductory thing and then if you do this you get this and this if you,” I would start to get a little concerned about it unless they’re telling you exactly what you’re going to get.

Jill DeWit:
If it feels like a timeshare, then that’s not the right thing.

Jack Butala:
I would also be very concerned … Jill’s going to kick my butt after this.

Jill DeWit:
We’re arguing here.

Jack Butala:
I’d be very concerned about if someone’s asking for a lot of money up front. We try to make everything in our world subscription based.

Jill DeWit:
Mm-hmm (affirmative).

Jack Butala:
You’re not going to be part of something for very long if it doesn’t work.

Jill DeWit:
Mm-hmm (affirmative).

Jack Butala:
If all the money’s up front and that’s it that concerns me.

Jill DeWit:
Mm-hmm (affirmative).

Jack Butala:
All right, that’s enough of that.

Jill DeWit:
Okay, cool.

Jack Butala:
I’m just a lot more conservative about stuff like that than you are, I guess.

Jill DeWit:
Well, this is not your thing and it’s my thing.

Jack Butala:
Yeah, you’re right.

Jill DeWit:
And that’s okay.

Jack Butala:
I agree, that’s more geared toward

Jill DeWit:
You don’t like to go out and do that. You don’t like to go out and do that. You want to read about this and all that good stuff.

Jack Butala:
You’re right.

Jill DeWit:
And that’s your thing, and that’s okay. This is more my thing. I like to get out there and get to know the people and all that, so I would be more inclined to do this anyway. Cool.

Jack Butala:
Great.

Jill DeWit:
All right, so back, Steven I want to ask you some questions. I know that you did a ton of research on this. No, seriously. I really know … And I know that you because I heard you talking about it. It’s hard to find some of these numbers. I don’t know why. It’s not like it’s a big secret. It’s just they’re not readily available, which is kind of weird.

Jack Butala:
Yeah, in the conclusion of my research on this was that I need to write a book about it, and I am going to. Or what I’ll do maybe at the very least is I’ll put a section on the website somewhere or one of those sites or all of them that says, “Here’s some stats.” Just some statistics about land, because it was tough. When’s the last time you ever went on Google or anywhere else and struck out on the exact thing you were looking for? I can’t remember.

Jill DeWit:
That’s funny. That’s really interesting.

Jack Butala:
This is hard data. What I’m looking for is the exact number of properties, the APNs, or assessment parcel numbers, in the country. How many total … I know it goes up and down, but I backed into it. We’ll talk about that in a minute.

Jill DeWit:
Okay, cool.

Jack Butala:
The whole theme is this. Here’s the whole point. There’s enough to go around. There’s way, way, way more properties. This all came out a talk that Jill and I gave at a local REI group. There were a lot of people in there that have never done deals before ever. The first reaction from a lot of them was, “Hey, don’t let this leave this room. We’re the lucky ones to talk to these guys.” I chuckle to myself all the time. I’ll throw some numbers out, Jill, all right?

Jill DeWit:
Mm-hmm (affirmative).

Jack Butala:
60 percent of all the land in the country is privately held, meaning it can be bought and sold by private individuals or companies or whatever.

Jill DeWit:
That’s a lot.

Jack Butala:
4 percent in Alaska. Only 4 percent of Alaska property can be purchased.

Jill DeWit:
Really?

Jack Butala:
Yeah.

Jill DeWit:
Everything else was like national, BLM?

Jack Butala:
Yeah, so there’s Bureau of Land Management, which is federal. Then there’s all different types of different [inaudible 00:09:52].

Jill DeWit:
[Corbin 00:09:53] [Engineers 00:09:54]? That one?

Jack Butala:
Yeah, exactly.

Jill DeWit:
All right.

Jack Butala:
Well, very good, Jill.

Jill DeWit:
Do you think I’m in this business maybe.

Jack Butala:
I’m proud of you.

Jill DeWit:
Thank you.

Jack Butala:
Then, the state owns a lot. There’s Native American reservations that they own a lot, especially out west here. Anyway, it comes down to 60%. There are almost 2.4 billion acres in the whole country, including Alaska White. I’m not sure about Guam. It doesn’t matter. If 60% is private that leaves about 1.4 billion acres of property to purchase.

Jill DeWit:
That’s pretty cool. I like this.

Jack Butala:
Think about this, and there’s 150 million households. When you take 1.4 billion and subtract it from 150 million, which is actually pretty much a drop in the buck, there’s a ton of property to buy and sell and flip and own.

Jill DeWit:
Right.

Jack Butala:
A ton of land.

Jill DeWit:
This is good.

Jack Butala:
Tons.

Jill DeWit:
I like that you’re doing this.

Jack Butala:
I’ve just scratched the surface. That’s why I really need to sit down and write, maybe not so much a book but let’s keep it all in perspective about flipping.

Jill DeWit:
A blog. That’s a good blog.

Jack Butala:
Yeah, it’s a good detailed blog.

Jill DeWit:
Yeah.

Jack Butala:
I can’t express this enough. Jill and I talk about it all the time. Every once, maybe twice a year, land owners get … They get land owners get a property tax bill, and they have this conversation with themselves or with their spouses, “Man, are we ever going to use this thing? We keep paying for this thing.” That’s what fuels our whole deal.

Jill DeWit:
Right. Exactly.

Jack Butala:
Please trust me. There is enough to go around. I’m going to knock on wood here, but we have never, in our huge community of investors, we have never run into each other. We don’t say this month we’re going to work in Tennessee. Nothing like that goes on. We give our members as much direction and guidance as possible, but we also teach them how to do it for themselves because I don’t expect them to be with us forever. They stick around for a long time.

Jill DeWit:
They do. It’s funny I’ve got to say about that as far as stepping on each other’s toes, we’ve never stepped on each other’s toes but we have received, good English, offers from our members, which I think once I would just crack up.

Jack Butala:
One time.

Jill DeWit:
I should’ve signed it and sent it back. I wish I would have thought of that ahead of time.

Jack Butala:
All the thousands of properties that we’ve bought and sold, we’ve received one letter.

Jill DeWit:
He cracked up.

Jack Butala:
One. It’s hilarious.

Jill DeWit:
That’s so good. I have some things to say.

Jack Butala:
Yeah.

Jill DeWit:
If I may.

Jack Butala:
Absolutely.

Jill DeWit:
Well, properties come back around, too, especially when you’ve been in the business as long as we have. We have had properties come back around. I am actually, I don’t know if you know this Steven.

Jack Butala:
I do. I saw it today.

Jill DeWit:
You saw that? I’m reviewing some property right now that someone has, I think he has a variety of 8 properties spread out over multiple states and he just wants to cash out. He sent me a copy of all the deeds and all the stuff he’s got for me to review and make an offer. As I’m thumbing through them, one of them we sold to him back in 2006.

Jack Butala:
I know. I saw my signature on the deed.

Jill DeWit:
Yeah, so it’s funny how they come back around. Things happen. The thing, too, we talk about this often is they weren’t ready 10 years ago, they weren’t ready 5 years ago, but they’re ready now. Now they are ready. Something happened and now they’re ready to sell. That’s an interesting thing, too. Not just with the hard numbers, but they come around. Another thing is, I know you talked about this too, you can make more land. I love that.

Jack Butala:
Yeah, did you ever hear of the old saying … If you’re a serial listener to this podcast you’ve heard me say this before. Did you ever hear that saying, hey, buy some land. They’re not making anymore. The people who say that are usually guys with big cow boy hats and big mustaches and stuff. You can make more.

Jill DeWit:
Yes, you can.

Jack Butala:
You can make more land. It’s call subdividing. You can take a big piece of property and make it into little pieces of property and create land and create value and create equity.

Jill DeWit:
You know what? When you do this blog, Steven, that’s a statistic I would like to see. For example, where we are right now in Scottsdale, the number of dwellings that are coming up now for sale, not just rentals, that we see, like you said, making land. People are buying these lots, not big lots, and putting high rise for sale units on it. That’s making land, in a way.

Jack Butala:
I think there’s no doubt about it.

Jill DeWit:
What’s the percentage of new unit, new ownership opportunities? Especially where we are, I bet it’s insane.

Jack Butala:
It’s staggering.

Jill DeWit:
Like Miami. I see a lot in Miami, too.

Jack Butala:
Jill and I have a very good friend who’s a house flipper. He and I often, when we get together it’s never over business. It’s always just horsing around. We always come to a point where we look at each other in the eye and say, “My biggest problem at work is choosing what to work on.” Because it’s like this is going to be profitable. Jill, you and I have this discussion all the time.

Jill DeWit:
Mm-hmm (affirmative).

Jack Butala:
What’s the next product we should roll out? Because it should be the one that’s going to be the most profitable or the one that’s going to help everybody the most. Usually we find a pretty good medium. Eventually we’ll get to them all, but there is so much opportunity it’s silly.

Jill DeWit:
Mm-hmm (affirmative).

Jack Butala:
It is silly. To bring my point on these statistics, and I will put a ton of them together … I don’t know. I’m a statistic freak.

Jill DeWit:
You are.

Jack Butala:
Anyway, what the heck good is it, any of these statistics, if you can’t deliver your message to the people who own these properties? Jill and I are licensed providers of core logic, real quest pro, which I think everyone agrees is the single best data source for real property records. They cover 99.5% of all the property records in the country. That means who owns it? How much are the taxes? Are there back taxes? On and on and on. Is there a structure on it? With all that data at your fingertips for not a lot of money, whose fault is it if you can’t make it work to your benefit?

Jill DeWit:
Right?

Jack Butala:
Especially when we’re giving away all this … Well, I’m not even going to use the S word, secret.

Jill DeWit:
Well, it’s not a secret.

Jack Butala:
This is how.

Jill DeWit:
Sharing. The S word is sharing.

Jack Butala:
Do you ever sit around say if you’re wondering about real estate, “How the heck do these pros buy? What is it with these guys that they own big buildings? I want to be that guy.” This is it. This is how they do it, with these types of tools, these professional great tools.

Jill DeWit:
Yup. Exactly. I appreciate you saying that, because it’s true. I was just thinking when you said tools I thought of something else. What? No. Pull your mind out.

Jack Butala:
What did you think about tools?

Jill DeWit:
No, because what was funny was we just created a Land Academy app for everybody if you have an iPhone or an iPad. It’s working on the Android version, but right now it’s just for iProducts. If you go to the app store and you put in Land Academy we pop up, so you can easily access all these podcasts, blogs, get to our website. I mean, all kinds of great stuff.

Jack Butala:
We got a congratulation from some competitors on that.

Jill DeWit:
That’s what I was going to say. The way they worded it was, “Hey, pretty good thing for your online toolbox or your toolkit.” I’m like, that was really nice to say. That was good. It’s one of our peers. I don’t think of him as a competitor. I think of him as a peer.

Jack Butala:
It’s Seth. Seth Williams. We’re trying to recruit him to speak at one of our talks. Jill came up with this bright idea a couple days about about PED talks, Property Education and Data. We’re recruiting some people in the industry, say show up and talk, and we’re going to have an annual thing.

Jill DeWit:
Have an awesome time. It’s going to be fun. It’s going to be good. It’s going to be fast paced.

Jack Butala:
Try not to have it in a hotel.

Jill DeWit:
We might have it in a hotel.

Jack Butala:
If I have my way … I’m not guaranteeing anything. If I have my way it’ll be free.

Jill DeWit:
It might be in a hotel, because then I can have food and I can have drinks and all the stuff there. I’m kicking him under the table right now.

Jack Butala:
I hope it’s free. I’m in so much trouble.

Jill DeWit:
So much trouble for this.

Jack Butala:
If I had my way we’d give everything for free.

Jill DeWit:
I know, and I’d love to, but you know what? How about this. I will give away free tickets. I can promise that. There will be free tickets. I haven’t got any of the details yet.

Jack Butala:
Yeah, maybe to the members.

Jill DeWit:
Exactly. Something. I don’t know what it’s going to be. Maybe discounted tickets. Maybe free tickets if you’re just signing up. There’s going to be some stuff that’s coming from that, but we don’t need to share that right now. You know how great it is? Could you imagine?

Jack Butala:
I’ve been described as monkey with hand grenades.

Jill DeWit:
That’s exactly what’s going on right now. [crosstalk 00:18:54]. I have to keep secrets from you.

Jack Butala:
I know.

Jill DeWit:
You know what? The next time I’m not even going to tell you a live event until it’s a week before.

Jack Butala:
That’d be great actually. Then I’ll go get my haircut.

Jill DeWit:
Yeah, that’s about how it’s going to go. I’m not going to tell you anything until we’re a week before. So, thank you, and I’m going to tell you all the wrong numbers too so you go out and advertise everything and I can sound really good. Cool. All right, join us in another episode where Steven and I discuss your all important success in property investment and in life.

Jack Butala:
I think it’s a healthy balance of value. Give away some stuff, charge a little bit, rational amount for some stuff. Everybody does well.

Jill DeWit:
Everybody expects something.

Jack Butala:
It can’t be free. I mean everything. All of it. Sometimes people just want everything to be free.

Jill DeWit:
Well, can I say something?

Jack Butala:
Yeah.

Jill DeWit:
Here’s my thoughts on that. If someone’s really giving me good information and really helping me I want to compensate them, because I want them to be able to keep doing this. I don’t want them to go broke and not be able to provide this benefit.

Jack Butala:
Right.

Jill DeWit:
So I have no trouble. There’s times that people have done something for me and I say, let me give you something for that. I really have done that. They’re like, no, no, no. I’m like, oh, yeah. You saved me. Even little things. You have saved me, so doesn’t matter. I have done that. They have said, no, no, no. You know what I did? I’ll go get them a gift certificate, find out a nice restaurant in the area, and I’m sending them a gift certificate because I need to compensate them.

Jack Butala:
Do you have any example in your head of stuff that you got and it’s like, oh my gosh, I should have paid for that.

Jill DeWit:
Yeah.

Jack Butala:
I got so much value out of that I feel bad that it was free.

Jill DeWit:
Yeah.

Jack Butala:
Do you have an example?

Jill DeWit:
Well, sometimes it’s just … I mean the one that comes to mind right now is I have a really great county … I’m not going to say anything about where this person is, but an individual in a county setting that has saved me and helped me and given stuff to me, and we have the most wonderful relationship. She’s kind of doing her job, but she’s really … I feel like, I know she’s doing really great stuff for me because I send a lot of good stuff. It’s not like I’m not spending money in the county, but she does stuff above and beyond for me so I try to thank her in other ways and stuff. They don’t have to.

Jack Butala:
Her number 3 kid has a baseball coach right now that every time I see him coach and I used to coach our kids when they were really little, but he’s too old now to have his dad coach. He’s got this. Every time I see this guy I’m like, man, I’ve got to do something for this guy. He’s a dad too, but he’s such a good coach, just really giving it his all.

Jill DeWit:
I’ve had stuff way, way, way back when. This is an old story, but I remember back when I worked at American Airlines years ago and I was at the ticket counter. I had folks with a really involved ticket. It was like an international ticket and they were leaving the next day kind of thing. I really did stay, lock the doors and spend an extra hour of my time. They came back and brought me this great bottle of wine. They sent me stuff. They went to thank me. It made me feel good, too.

Jack Butala:
That’s why we’re doing this Land Academy thing.

Jill DeWit:
Right.

Jack Butala:
Because it feels good.

Jill DeWit:
It does feel good. It’s good.

Jack Butala:
Yeah.

Jill DeWit:
So, yeah. Thank you, Steven.

Jack Butala:
Good example.

Jill DeWit:
Thanks.

Jack Butala:
Let’s go buy some property.

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