Monday Deal Review Huge Acreage Takedown (CFFL 0266)
Monday Deal Review Huge Acreage Takedown
Jack Butala: Monday Deal Review Huge Acreage Takedown. Every Single month we give away a property for free. It’s super simple to qualify. Two simple steps. Leave us your feedback for this podcast on iTunes and number two, get the free ebook at landacademy.com, you don’t even have to read it. Thanks for listening.
Jack Butala: Jack Butala with Jill DeWit.
Jill DeWit: Hi.
Jack Butala: Welcome to our show today. In this episode, Jill and I talk about our Monday Do Review. Today’s topic are huge acreage takedowns. Some people specialize in them, some people avoid them. We’ll talk all about it. Before we do, let’s take a question posted by one of our members on Successplant.com, our free online community.
Jill DeWit: This one is a family post. I love how they put that. They are the Watson family. The Watson family asked: The benefits of having multiple properties on the same deed have been discussed, but what about when closing through a tittle company? In a scenario where there’s a seller with multiple properties in the same county, can you typically close through a title company and have all the properties covered under the same title policy?
Jack Butala: Jill DeWit, you are so qualified to answer this question.
Jill DeWit: Yes.
Jack Butala: That is the answer.
Jill DeWit: Done it.
Jack Butala: That’s way more attractive.
Jill DeWit: Yes. Definitely.
Jack Butala: The truth of it is it’s almost always, I can’t think of a scenario where it’s not almost always, more attractive to purchase multiple properties at once. I call it the buy a case and sell it by the bottle methodology. Yeah. A title policy generally will cost pretty close. If you buy one property with a title policy and you buy 50 properties on a same title policy, this is in general, they are very close in price. The work that’s involved and the risk, because it’s coming from one seller, I don’t know much about insurance, but apparently the risk is close to the same because the price is the same and the work’s the same.
Yeah. I’ve done deals where it’s a release or a takedown, where every month we buy a certain amount, and the title policies done on hundreds and hundreds and hundreds of properties all at once, upfront from one seller. Yes, yes, yes, and yes. The fact that they’re all on one deed, or multiple deeds, it’s a little bit confusing. It gets confusing because of car titles. You could never have 5 cars on a car title, right?
Jill DeWit: No.
Jack Butala: You can have 5 properties on one deed and then sell them off each individually with individual deeds. That’s the universal. Once you do 5 or 10 deals, you realize that’s just how it goes. That’s the norm.
Jill DeWit: You know what’s interesting, too? I was going to add for the Watson family, this sounds like a big deal transaction, but it’s not. It’s easiest for you of all of them because they’re doing everything for you all at once with all the properties and the same seller, so I love these. These are fantastic. Another thing I’d like to point out is when you have title insurance, make that a big deal in your posting. That really is a nice thing. You paid extra for that, so you want to brag about that.
Some buyers will really go, “Oh.” They like that coming into it, they can see these must be bigger deals, that you’re paying for it, too. Maybe there’s a trust or something involved because that’s where you’re bringing in a title agency, or these are more valuable properties. Either way, that’s great. Make sure you brag about that and price accordingly. Maybe you mark it up a little bit because you’ve already done some of the extra work that people might want.
Jack Butala: We literally put a link, if you go to Landstay.com, you can see our completed sales. You’ll see a link to the actual scanned on policy. 10,000, way more than that, actually, properties that have been purchased, and you can go back and see the title policies.
Jill DeWit: You know what? You just brought up a real good point. Exactly. When you guys post this property, Jack’s right, we do that, you’ll have images of the property. You’ll also have a link right there to the title policy so they can see it, so that’s good advice.
Jack Butala: Exactly. This is about the Watson family.
Jill DeWit: The Watson family.
Jack Butala: I love that whole presentation. There’s a very successful group of real estate agents in the Phoenix area, and they’re last name is Callaway. This is what’s on their sign and all on their marketing: Those Callaways. She’s number 1 or number 2 in the number of listings every single month I get the report. It makes you intrigued. What’s the Watson family? How many are there?
Jill DeWit: Right. 9.
Jack Butala: Is it an army?
Jill DeWit: I don’t know.
Jack Butala: Those Callaways. What the heck is that? Are there 50 of them or 2? What’s the deal?
Jill DeWit: Is this a gang?
Jack Butala: I like it.
Jill DeWit: Do they have red bandannas?
Jack Butala: Yeah. Exactly.
Jill DeWit: Love it.
Jack Butala: Today’s topic is a Monday Deal Review. Every Monday, Jill and I talk about properties we’re working on. Just like you could almost really set your watch by it, a huge deal came across our desk, actually from a member. It’s my first gut, 8th of a second, was this is too big for us to do. I got into it and found out the work’s already done. It’s already cut up into 5, 10, 20, and 40 acre properties in New Mexico.
We love acreage properties in New Mexico. When this is all said and done, and if the planets are aligned, and they never are, but when it all works the way it should, all of us involved will probably make an excess of between 800 and 1.5 to 1.7 million in cash. If it’s terms, it’ll be a lot more than that. That’s the deal, though. I don’t even know if Jill knows about this yet.
It’s not an assistant. It was not returned via mail. Why is this guy, who calls himself Jack, working on a deal where he says never, ever work on a deal that’s not in your acquisition criteria?
Jill DeWit: What did I just hear? All right, Jack. Thank you for calling yourself out. I didn’t get there in time.
Jack Butala: Is it in an apartment building? No.
Jill DeWit: What?
Jack Butala: Is it completely veering from what we do? No. I’ll tell you why, because I’m going to make more than a million bucks on this thing, and it’s a sure thing.
Jill DeWit: All right. It’s not in our acquisition criteria. Okay.
Jack Butala: Am I going to go redevelop an office building, buyer database to get it done? No. Is it a pie in the sky transaction? Absolutely not. In fact, it’s going to happen. It’s a foreclosed property deal with a lender who’s completely out of her league from a property-type scenario. They don’t have any idea what they should do.
They’re looking to us to solve their problem, which we will. I know who is going to buy it already.
Jill DeWit: Oh. Are they fine on their taxes? Just kidding.
Jack Butala: I bet. It’s all in one subdivision. The subdivision, actually, this is interesting, it’s in 2 counties. 2 counties in the same state. You don’t see that too often. Usually you deal with one county. No. It’s safe. It wasn’t a smoking deal right up our ally kind of thing, and that was my first reaction.
Jill DeWit: Okay. How many properties are there again?
Jack Butala: 800 and something. 880, but they’re all acreage properties.
Jill DeWit: Did they HOA fold when they took them back, or how’d they get them?
Jack Butala: Somebody went and sought out a loan to buy these properties. The bank took it back for lack of payment.
Jill DeWit: How long ago? I wonder how long.
Jack Butala: Less than a year.
Jill DeWit: Interesting.
Jack Butala: It’s a slam dunk deal. We’re buying it for less than $100 an acre.
Jill DeWit: Nice.
Jack Butala: You and I have personal experience together selling property in the same subdivision for one hell of a lot more than $100 an acre, for cash. Like I said, I wouldn’t be working on this deal if I didn’t know we could get it done.
Jill DeWit: Got it. Nice. All right. Every now and then it’s okay to veer from the acquisition criteria when a slam dunk comes your way?
Jack Butala: I would even argue that the way this deal got to my desk is not a traditional way, but it really is within our acquisition criteria. This is the triple slash, not out of the park home run, but it’s the home run you’re looking for. It just didn’t come in by way offering mail. You know what it did? It came in by having Land Academy, which is one of the material reasons that Jill and I sat around one day and said, “You know what? We should launch this thing because it’s going to turn out we’re going to do more deals.”
I was joking a little bit before. This is right into our acquisition criteria.
Jill DeWit: It is. Thank you. Are there any more numbers that you can share with us?
Jack Butala: Yeah. Those are pretty strong numbers. I don’t remember. It’s between 830 and 870.
Jill DeWit: Okay. You want to leak them out? How are you going to do it?
Jack Butala: My first choice is to do this: Get control of the property for little to no money, and that sounds like that’s going to happen. I’m either going to buy the property from somebody else, a huge money guy, and then just turn it quickly, or we’re going to negotiate something with the bank, which they’re all in favor of, too. They just want to get rid of this.
Jill DeWit: Got it. Can you have a release?
Jack Butala: We could.
Jill DeWit: Do a monthly release? That’s one of your options?
Jack Butala: Release is an option.
Jill DeWit: 30? A month, or whatever you want to do?
Jack Butala: That’s an option.
Jill DeWit: You just want to get them all?
Jack Butala: I would rather approach this, get control of the whole transaction, and then market it to a very select number of people that are in our list, that you and I both know about, and just resell it. That’s just how I roll. I would rather make half a million bucks really very, very quickly marking it up for cash to cash than make 4.2 million over 6 years, and then marketing it with drone photos and stuff. There’s another deal that’s going to come around the corner just like this one.
Jill DeWit: Exactly.
Jack Butala: There’s a lot of people listening to this right now saying, “You are off your rocker. Why would you make it half a million bucks to set up 4.2 or some number?”
Jill DeWit: That’s the way you like to do it, and I’m with you. There’s a reason to that. We are wholesalers when it comes to this thing.
Jack Butala: Get in and get out.
Jill DeWit: Yeah. We hope that, and that person makes a fortune because they are now our best customer forever.
Jack Butala: That’s who’s going to buy it from me. The person who’s going to buy it from me is going to go do that. They’re going to go make 4 million bucks on it.
Jill DeWit: They already have, and that’s why they’re on our list, too, by the way, but just not at this scale. There you go. That’s awesome.
Jack Butala: It’s the technical, too. 2 minutes of property investment advice from our 15 year, 15,000 deal experience. Know the difference between veering from your acquisition criteria and not veering. It’s a fine line to dance on, but I’ll tell you, if you think you have to recreate the wheel because you might make some money, even though it’s in real estate, specifically maybe a different product type, like strip malls or something, that’s out of your acquisition criteria. You don’t have to be a crazy engineering weirdo about it and say A to B to C. It has to happen before I will even look at it or sell it or buy it. Know that line.
Hey, and if you have a question or you want to be on the show, call 800-725-8816. Jill, inspire us.
Jill DeWit: It ties into this, don’t be afraid, but do your research then decide, because like you said, Jack, this is a good example. This came across my desk, forget it, not my thing. I don’t want to deal with that many properties. It’s just so much work. It would’ve been easy to say, “Pass,” but you did take a moment.
You did do the research and find out, “Wow. A, B, C, D, and E are already done. Okay. Now you got my attention. This might be something worth doing.” Do your research. Don’t be so quick to judge in this environment. Someone’s calling me back and they have this kind of a property, I don’t even know where that is, I don’t know that area. Oh, my gosh. Oh, that’s a whole different state I’ve never worked in.
Maybe it’s the same seller and they have 4 properties in the area you like and then 6 over here. It’s okay. Don’t be afraid. Do a little research, check it all out, then decide. It might get you branched out. Now I know this area, and now I know this kind of a thing.
Jack Butala: Yeah. This ties into what I was saying, too. The research that you’re going to do is does this fit into my sale’s scheme? If I put this on my website, is there a chance that it’s going to sell pretty well through the people that I have on my mailing list? Are they going to respond to this? Are they going to say, “What the heck are these guys doing now buying office buildings?” Or something crazy. No. You just want to see if it makes sense.
Jill DeWit: Exactly.
Jack Butala: You don’t want to buy a mine. Just because we’re land people doesn’t mean we’re mining people. This happens to us frequently. I don’t know why.
Jill DeWit: I’ve had the people ask about grazing. Do you ever get property for farm animals?
Jack Butala: There’s a list of things that I know nothing about.
Jill DeWit: That’s really not my thing.
Jack Butala: Cattle ranching, mining, mineral rights, farming of any kind.
Jill DeWit: Baseball.
Jack Butala: This is fun. Give us a list of stuff you don’t know anything about, Jill.
Jill DeWit: Oh, my gosh.
Jack Butala: I know a lot about data, a little bit about real estate.
Jill DeWit: Popping open a computer, cooking.
Jack Butala: We should do a show about this.
Jill DeWit: That’s good. Oh, that’s funny. I’m trying to think. There’s a lot of things that I don’t know a lot about, and I’m good with that.
Jack Butala: Development, I don’t know much about that. Vertical construction, don’t know about it. I know a little bit about subdividing.
Jill DeWit: There you go.
Jack Butala: This is fun.
Jill DeWit: I’m trying to think. Give me some. Anything electrical. What else? That’s funny. That’s a good topic. I love it.
Jack Butala: Keep going. I want to know what else you don’t know about.
Jill DeWit: I know. I’m trying to think. Come on, you do better. You do me and I’ll do you.
Jack Butala: What do I know nothing about? Let’s see.
Jill DeWit: No, with me.
Jack Butala: Oh. I’m going to say what you don’t know about?
Jill DeWit: Yeah. “Jill, you don’t realize this, but,” this could even be more fun. Jill, what do you think you know something about, when you really don’t know?
Jack Butala: Jill loves to sing and she doesn’t know anything about that.
Jill DeWit: I am familiar with that now. I know that. Thanks a lot.
Jack Butala: All right. You’re next. Go.
Jill DeWit: Oh, my goodness. This is going to be good. I don’t know. I’m gone now. I can’t think of one, Jack. I’m having a hard time. It’s really good, though.
Jack Butala: What? It can’t be that hard.
Jill DeWit: I know. I’m having a brain fade. I have a brain fade. You know what it is, Jack? I have all this stuff on my mind right now. I have all these things going on. I have a lot of transactions and things. It’s a really, really good week for me right now.
Jack Butala: It’s a good Monday.
Jill DeWit: It is. I have to apologize if I’m not 100% here.
Jack Butala: This is a guy’s dream to have the woman say, “I don’t know. I can’t really think of anything off the top of my head that you think you know a lot about, but you really know nothing about.” I think you should take an extra minute here. I’ll entertain everyone.
Jill DeWit: How funny is this?
Jack Butala: What do I have a big head about that you’re just like, “Oh, my gosh. He’s doing plumbing again. I know I’ve seen the end of this movie”?
Jill DeWit: Okay. Really?
Jack Butala: Yeah.
Jill DeWit: All right.
Jack Butala: Absolutely.
Jill DeWit: Okay. Oh, no. I can’t. I’m having a hard time with it because I don’t want to make you like I’m throwing you under the bus.
Jack Butala: I have one about myself. I recently learned this from my children. Go ahead.
Jill DeWit: Okay. Go. What?
Jack Butala: No. Go ahead.
Jill DeWit: Mine?
Jack Butala: Yeah. Don’t hold back.
Jill DeWit: You know what?
Jack Butala: We can always not air it if it’s awful.
Jill DeWit: Okay. I’m having to dress you younger than you act, than you want to dress.
Jack Butala: I know. That’s true. I know nothing about how to dress myself.
Jill DeWit: You know nothing about dressing your age. How’s that?
Jack Butala: You’re absolutely right about that.
Jill DeWit: It’s a girl’s point thing, and I get it, and I appreciate that. There’s not a Brooks Brothers on this land for a reason.
Jack Butala: Wow. They’re right. There isn’t.
Jill DeWit: Okay. There’s mine.
Jack Butala: Awesome. I have mild dyslexia and I have issues writing. I’ve been writing notes recently for people around the house and the office, and everyone’s just been laughing behind my back about it. It’s come to my face now, which is pretty darn funny because then I turn it all around and they start to feel bad for me. It’s fun. It’s fun for me.
Jill DeWit: It’s like, “Hi. What is this word? I don’t know. Do you know? I don’t know.” That’s a good one. Okay. There. I could say, “Jack, you think you know how to spell, you really don’t.”
Jack Butala: Oh, no. Yeah. No, I don’t know. I know that about myself.
Jill DeWit: All right. I got one. Jack, you think you know Word. You don’t know Word.
Jack Butala: Microsoft Word?
Jill DeWit: You only know Excel.
Jack Butala: That’s exactly right.
Jill DeWit: Jack, when you spell check, it won’t find it. It’s so totally destroyed that even spell check can’t figure out what it is.
Jack Butala: All true. All these things are true.
Jill DeWit: I don’t mean to pick on you. It’s just funny stuff.
Jack Butala: No. It’s fine.
Jill DeWit: All right. Good.
Jack Butala: Boy, we could go on.
Jill DeWit: Yes.
Jack Butala: We shouldn’t.
Jill DeWit: Off topic.
Jack Butala: Join us in anther episode where Jack and Jill discuss how to use information. That’s me.
Jill DeWit: Inspiration, that’s me.
Jack Butala: You get just about anything you want.
Jill DeWit: We use it every day to buy property for half of what it’s worth and sell it immediately.
Jack Butala: You are not alone in your real estate ambition. Good show, Jill. We did the after talk already.
Jill DeWit: I know. I was trying to think of a good thing. You know what, Jack? I legitimately mean this, you’re really good at stuff because even if you’re not really good at it, you’re good at finding the answer. That’s something about you. You will not throw up your hands. I don’t know if I’ve ever seen you throw up your hands.
You will throw up your hands because you’re frustrated, but you won’t stop. You’ll YouTube the hell out of something, and take on projects that are probably too big that could’ve been done by a mechanic in a 4th of the time, but you don’t stop. It’s hard for me to come up with things. How could I say you’re not good at it? You just haven’t developed it yet.
Jack Butala: That’s really, actually, a nice compliment. Thank you.
Jill DeWit: You’re welcome. It’s true.
Jack Butala: Yeah. I have given myself a lot of criticism. There’s certain stuff you should just never take on. We’re going through a huge virtual assistant/outsource movement right now, changing in our companies, because there’s people out there who are just experts at tiny little things that we do, like producing a podcast, for instance. They’re way better, and it’s way cheaper in the end to have that done. I’m trying to reel that back in a little bit. There’s only 24 hours in a day.
Jill DeWit: I know. Isn’t that funny?
Jack Butala: You should be spending at least half your time having fun, that’s what I say, and half your time working.
Jill DeWit: Not sleeping. Skip the sleep. That doesn’t come up.
Jack Butala: Jack and Jill. Information and inspiration to buy undervalued property.
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