Good Bad Ugly of Land Investment
Jack Butala: Jack Butala with Jill DeWitt.
Jill DeWit: Hi.
Jack Butala: Welcome to our show today. In this episode, Jill and I talk about the good, the bad, and the ugly of land investment. I might have been watching too many Westerns lately. Before we get into it Jill, let’s take a question posted by one of our members on landacademy.com, online community. It’s free!
Jill DeWit: Okay. This name I always have a hard time with it. It’s [Calill 00:00:27], I think. [Calill 00:00:30] asked “On the mailers, do you ever re-mail to those that did not respond? Like do you mail them two or more times to those prospects? Is it a waste of money?”
This is a good question, because I see this in other types of real estate where some people hit perspective sellers with multiple offers or actually, they just do postcards. So what are your thoughts on this, Jack?
Jack Butala: Yeah, so this comes a lot, especially with house investors for some reason. And I think the origin of it is mailing people who have property, who have back taxes that are associated with it, or it’s a foreclosure situation, or there’s some kind of … You know. If you listen to this show at all, you know that we don’t do that. We mail just about everybody. If they don’t have a mortgage on their property, that’s the trigger for us. And by doing so, we get the people who are maybe in foreclosure, and we get the people who have back taxes, but we mail everybody. So, our companies have never done a follow up mailer. So that directly answers your question. But that’s not to say it doesn’t work. I’ve heard of people doing it, where you send out an offer, the way that we suggest, that contains all the things that we suggest. The purchase price, and a bunch of other stuff, and then send out a postcard maybe two weeks later that says, “Hey I just wanted to make sure you got my letter, because we really are serious about buying a property at that price, and I’ve heard good things.”
I guess if we buy one more property, we’ll try it. That’s the answer. If we buy one more property because of that follow up mailer, you’re going to way more than pay for the actual cost, and expense, and time and all that of doing it. So I’ve been thinking about that. I’m glad this question came up. I’ve been thinking about changing up slightly what we do, or trying a few new things based on the fact that it’s whatever, 2016 now, so I’m glad this came up.
Jill DeWit: Almost 17.
Jack Butala: Yeah, I mean yeah. Exactly, so.
Jill DeWit: 2017 is around the corner.
Jack Butala: Yeah, it’s always good to try new stuff.
Jill DeWit: And I agree with you, I like it. If you’re going to do something like this, I like your idea Jack. Change it up a little bit, don’t send the same thing, you know? Just hit them with the same thing twice. Make it a little bit, Hey, just to follow up, I am serious, and you know, let me know. So that’s good.
Jack Butala: I guess what I’m saying is all the other rules still apply. The printer that we’re using now, which is a new one, all of us in the group are using a new printer called LetterStream, at a huge deep discount. They make it so easy to do the mail merge, and so mechanical, and so that you can just keep track of the mail that you’ve sent, and you can take out duplicates. There’s a ton of reasons why, now more than ever, sending up a follow up postcard offer might make sense, so we will try it, and obviously talk about it in the show.
Jill DeWit: Yeah.
Jack Butala: Hey, if you have a question, or if you want to be on our show, reach out to either one of us on LandAcademy.com. Today’s topic, this is the meat of the show by the way. The good, the bad, and the ugly of land investment. And Jill asked me right before the show, “What the heck is this all about? What should we be talking about?” And I said, “You know what, why don’t you just tell me what you think it is, and I’ll tell you what I think it is, and we can laugh about the fact that it’s probably not the same thing.” So what do you think it is Jill?
Jill DeWit: I think of this as just like the big picture, like, you know, this business as a whole. There’s good stuff, there’s bad stuff, there’s ugly stuff. I mean, and that’s the same with everything. So then I took it a step further, and I thought, you know what for me personally, this is where I know we’re going to differ. Is it’s just perspective. What I think is good somebody else thinks like, I hate that job, and then vice versa. Like I like talking on the phone, that’s not your thing. You’re going to need to talk to some people in this world. So, and paperwork. I hate paperwork. I hate that kind of stuff. I think you and I both agree on that, that when you’re … But big deal. I’m doing a couple of deeds, you know? I’m not in this business, I don’t have a warehouse of inventory I have to keep track of, you know? I can keep track of my business on a spreadsheet, you know, kind of thing. If that’s all I have. So, and then like I said, it’s just kind of about perspective. What do you think Jack?
Jack Butala: I think that there’s a list, you know you can do a pros and cons list of every single thing on this planet, you know? And I did a mental one when I wrote this title a while ago. And when I got done with it, it only took just a couple minutes, I could not … We are going to differ on this a little bit. There’s nothing bad about this, and I hate when … I really don’t like when people say, “There’s just nothing bad about it, it’s great.” It’s too good to be true. Come on, I’m always looking, you know? When I look at reviews at Amazon, I only read the one star ones. Great-
Jill DeWit: Oh seriously?
Jack Butala: Yeah, I never read-
Jill DeWit: That’s funny, I look at the positive ones, and then I weed out the negative ones. Like I glance at the negative ones, and I think oh you’re an idiot, you know? You know which is true, because they say the blue was not as blue as I thought it was going to be. I mean come on, so.
Jack Butala: You know what I look for in an Amazon review, I don’t want to get too sidetracked, is if the item arrived and it didn’t work. And if those are all the one star points, because chances are, I’m going to get one that works, then I buy it. But if they say “This worked great for two weeks, and then it was just over.” That concerns me a little bit. Anyway, you know, honestly there’s only a couple things that are, that I don’t like about this land flipping business, and you nailed it earlier. Every business has them. There’s paperwork to everything. There’s shipping to everything. There’s talking customers, there’s disgruntled customers with every single business that you have. The vast majority, I would say 95% of the time, everything just goes great. The more software applications that we release … We’re about to release a new version of Land Stay, our actual land selling website, and open it up to our members to they can post their own stuff on there. The more versions of software solutions that we come up with, the easier it is and the more fun it gets, you know?
Jill DeWit: Right. You know I had a really interesting call with someone recently, and they were thinking about getting into our world, they are in our world now. And they asked me this question, I thought gosh that was so good. They said, “Who are the people that you see that don’t, that take this step, and don’t succeed.” I’m like oh, that was a good one. And what was it?
Jack Butala: Wow I want to know the answer to that.
Jill DeWit: Yeah, and you know, and KI said, that’s a really good question, I love that. And honestly, it’s the people that can’t commit. And it’s not that they can’t commit, they just can’t commit to anything I think, it’s in them. They think that there’s a magic something that’s just going to happen. But no, it’s just like everything else, it takes work, and you have to work at it. You have to be diligent, you have to be proactive, you have to … It’s like with … I can give you all, I can get you all set up and everything, and make your phone ring, but you got to answer your phone. You know, I can’t do that for you too. So that was my only thing, is just the people that don’t apply themselves, I guess, you know? And I thought that was a really good question. Because I’ve seen it.
Jack Butala: Here’s my, and that’s such a good question. This is what I see, for people that do well or don’t do well in this environment. They have a little bit of experience already. I’m not saying that, we have people who are brand new that just do great in this environment, but for whatever reason, the majority of the people that I see, come to Land Academy and the light bulb goes off up over their head, and they say this is it. Because over here when I flipped this house, I had to do all this … And this is a solution to that. And they see it that way, and they say, “Man, I don’t ever have to go look at this property, I can hire people to do drone shots and stuff.” Boy, that takes all of it, all the garbage out of it. The stuff, the good, the bad, and the ugly is removed. That’s my whole point to this whole show.
Jill DeWit: I love it.
Jack Butala: There’s stuff for me anyway. Jill and I, we have some contractor friends who love ripping apart the wall and seeing what’s inside there and making it better. They love it. They look at us cross eyed like data, why would you want to take all the fun out of this. You’re never going to see the asset. You just turn that market up ten grand, and do the next one. What the heck fun is that?
Jill DeWit: I agree with you.
Jack Butala: That’s not my thing.
Jill DeWit: Well I love … You’re right. Having some experience, I love the SFR guys that come our way, that when we start talking numbers, and they start sharing with me like I’ve lost 100 thousand dollars on a home, and you and I have talked to people who have lost a whole lot more, you know, doing a renovation. Remember that North Manhattan Beach house?
Jack Butala: Yeah, yeah.
Jill DeWit: We’re talking like a million, you know, this person lost. Like you know, just doing it all wrong.
Jack Butala: Yeah.
Jill DeWit: God, talk about scary.
Jack Butala: There is a lot of moving parts in that. You could do everything right, price it right, and here’s my like. I’m going to list a bunch of things that really concern me. The good, the bad, the ugly for me.
Jill DeWit: Okay.
Jack Butala: You know, I’m not a designer, so let’s say I do everything right. I buy the property right, I get the right contractors, but you know, the stuff that I choose for the kitchen is right out of the 80’s, because it probably would be. Or maybe it looks like a log cabin somewhere and it’s in Manhattan Beach, you know? That’s all not going to work.
Jill DeWit: Remind me when you’re done, I want you to finish this, but I have something really funny to share along those lines.
Jack Butala: That’s why I have you, because I can do the back end of that, all that stuff. And then you can start. You have to have women involved in some certain stuff, you know? There’s just things that women are better at period. And I’m going to get a ton of email for saying that, but it’s just true. But anyway go ahead, go ahead.
Jill DeWit: Okay, here’s my funny story. So our neighbor went to a Beverly Hills up on Mulholland Drive Christmas party the other night, not kidding. They had to meet at like a parking lot, and there was like 600 people, she works for an advertising agency. Huge party, 600 guests at this home that they rented up in like whatever Beverly Hills area. Anyway, so they get there, she said “I walked in, and this home looked like every single 70’s porn must have been filmed here.”
Jack Butala: Oh my God.
Jill DeWit: Because the design was that awful. Like the black toilets, all just too white, no color or anything anywhere. It was just, she said it was hilarious, this home. And it was like grand staircases, and all this stuff. It was just the funniest thing. So that’s a good example. I mean look at this home and what it’s probably worth, but she walked in and went ugh, with the design and the decoration. It was just so funny. So, that was good.
Jack Butala: Hey, if you have a question or you want to be on the show, reach out to us on LandAcademy.com, or join us in another episode, where Jack and Jill discuss how to use information, that’s me.
Jill DeWit: And inspiration, that’s me.
Jack Butala: To get just about anything you want.
Jill DeWit: We use it everyday 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. Yeah, so like, I want to list a bunch of stuff Jill.
Jill DeWit: Okay.
Jack Butala: You tell me if it’s good or bad or ugly. I’ll start with the obvious stuff you already mentioned. Paperwork?
Jill DeWit: Bad.
Jack Butala: Oh it’s not even ugly? It’s just bad?
Jill DeWit: Which is worse, bad or ugly?
Jack Butala: Ugly.
Jill DeWit: Okay, then it’s bad. Because it’s not ugly, it’s not horrible. So okay.
Jack Butala: Ugly, not ugly like a hippopotamus ugly. I just mean like-
Jill DeWit: It’s worse than bad.
Jack Butala: Customer service.
Jill DeWit: Good, because you can get-
Jack Butala: Data analysis?
Jill DeWit: Good.
Jack Butala: Yeah. Software application development?
Jill DeWit: Good. Why?
Jack Butala: Because this is exactly what I went through. Just like this, I couldn’t find anything wrong with it, you know? And then I thought, it’s because the bad stuff, we have systematically weeded it out. Like here’s a great example, you and I flipped several houses and we renovated them, remember that? During the downturn?
Jill DeWit: Yeah.
Jack Butala: I’m sure you remember. And it’s like you know what, we never want to do this again. So I devised a whole program where we just make 10 or 20 grand on every house, or ten grand on each house, and we leave it to the experts to develop the stuff. That’s why there’s nothing bad or ugly about doing this. We’ve engineered it this way.
Jill DeWit: Bingo.
Jack Butala: Information and inspiration to buy undervalued property.
If you have any questions or comments, please feel free to email me directly at jack@LandAcademy.com.
I would like to think it’s entertaining and informative and in the end profitable.
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