Cheap Land – Where to Buy it (CFFL 364)

Cheap Land – Where to Buy it

Jack Butala: Cheap Land – Where to Buy it. Leave us your feedback for this podcast on iTunes and 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:                               Hey, happy Thursday.

Jack Butala:                            Welcome to our show today. In this episode, Jill and I talk about cheap land, where to buy it. That’s pretty funny.

Jill DeWit:                               Pick me. Pick me.

Jack Butala:                            First before we get into it, let’s take a question posted by one of our members on the landacademy.com online community. It’s free.

Jill DeWit:                               Okay, Ryan asked, “I’m going through the notary close checklist and I realize that I don’t know how to check for clear chain of title. Do I need to do this for every property? Can I use the membership tools to do this?”

Jack Butala:                            Oh, my gosh. Jill, this question is made for you.

Jill DeWit:                               I love this.

Jack Butala:                            We’ve built a business around solving problems like this.

Jill DeWit:                               Yes.

Jack Butala:                            Jill, take it away. I’m going to take a nap.

Jill DeWit:                               Yeah, take a nap. This is actually not going to be long. For every property, you do need to be, you do need to check ownership. You do need to do your due diligence. You want to make sure before you buy it, you’re buying it from the right person, who really has the power and authority to sell the property and they own the property, and I do this initially when I first am dealing with that individual right away. First thing you need to do, Ryan, is when they send back an offer either signed or they pick up the phone and call you or email you, however it is, first thing you’re going to do is go right into our membership tools, yes. Whether it’s Core Logic or Title Pro, either one works. You’re going to check, or even go to the county website. That can do it, too, and you’re going to check ownership-

Jack Butala:                            Current ownership.

Jill DeWit:                               Current ownership.

Jack Butala:                            Like the person you’re talking to on the phone has a seller that needs to match.

Jill DeWit:                               Exactly.

Jack Butala:                            Who owns the property.

Jill DeWit:                               “Hi, I’m John Smith. I got your letter about my property,” and you pull it up and you go, “Owned by John and Betty Smith.” Love it. Great check. I’m talking to John. Next question is, “Is Betty still with you?” “Oh, gosh. She’s in the kitchen, she’s making me coffee right now. Would you like to talk to her?” “No, no, just making sure.”

Jack Butala:                            That’s all green lights what Jill’s describing.

Jill DeWit:                               Yeah, yeah.

Jack Butala:                            Here’s a red light. “Who’s Sally Struthers?” “Oh, she’s my second aunt’s third whatever, and she died about 14 years ago.”

Jill DeWit:                               “Yeah, and she told me that I can have this property. Now I’m calling you back on it.”

Jack Butala:                            Red light. Big problem.

Jill DeWit:                               Yeah, now we have a problem.

Jack Butala:                            Yeah.

Jill DeWit:                               This is how you do your homework, so yes, you do need to do this to every property. Can you use membership tools to do this? Yes, and how far back do you want to go? This is most title companies, it’s between 30, I want to say 30 to 45 years.

Jack Butala:                            Wow, really? That far back?

Jill DeWit:                               I think is when they do their title work, but you have all this at your fingertips and this is what I love about our tool, Title Pro, so if you want it, and I do. I glance back. Even on the county, some, not all, very few actually. There are a few county websites you could actually scroll back and see the chain of ownership.

Jack Butala:                            Yeah.

Jill DeWit:                               From and you can just kind of glance and see, “Yep, that matches. That matches.”

Jack Butala:                            Most counties have a record, their records are online, and some of them provide public use for that. Like Mohave County, Arizona, has one.

Jill DeWit:                               You can call.

Jack Butala:                            You have to do some work, but you can paste it all together. It’s way, way easier, as all our tools.

Jill DeWit:                               Yeah, that’s what I do, Ryan. Just look it up.

Jack Butala:                            Yeah.

Jill DeWit:                               Here’s what I do, too, and here’s, and I’ll end it on this, so what I do, Ryan, like so checked all the boxes. I looked back. Everything matches and especially when I’m talking to somebody. This is our typical seller, is, he, that you’re talking to John and Betty Smith, and they’ve had it for 40 years.

Jack Butala:                            Yeah.

Jill DeWit:                               The vesting deed is 1961 and it’s 2017 almost and you’re-

Jack Butala:                            That’s a triple green light situation.

Jill DeWit:                               Right, and so guess what you just did? You just did your homework.

Jack Butala:                            You just did what a title agent would have done for $800.

Jill DeWit:                               Exactly, because if they’ve … Since they’ve owned that property in 1961, if no one ever came forward before that, I’m good with it. They had 45 years to whatever. You did your homework. Good questions and you’re doing everything right, Ryan.

Jack Butala:                            Our land business model is predicated on the fact that, “Hey, okay. You’re buying a piece of property for a $1,000 or $2,000. If every a 1,000 properties that you purchase or every 800 properties that you purchase, you’ve missed something, and somebody comes forward and says, this has never happened to us in 15,000 properties, by the way. I’m knocking on wood. You lose that $2,000 or you have to refund the $4,000 that you sold it for, it’s going to be okay. Does that ever, almost ever … I mean, it’s never happened to us, but in the spirit of full disclosure, mistakes could possibly be made, but we don’t worry. In fact, we don’t talk about it.

Jill DeWit:                               Exactly.

Jack Butala:                            I used to worry about it a long time ago and it’s a very valid question, by the way.

Jill DeWit:                               Right.

Jack Butala:                            Get to know how to do it. It’s like driving a stick.

Jill DeWit:                               Right.

Jack Butala:                            A stick shift. Get to know how to do it like Jill says, and then eventually hire somebody.

Jill DeWit:                               Good job.

Jack Butala:                            Check their work, yeah.

Jill DeWit:                               Good job.

Jack Butala:                            If you have a question or you want to be on the show, reach out to either one of us on landacademy.com. Today’s topic, this is the meat of the show, cheap land. Where the heck do you buy it? Here’s why I came up with the background on this topic. Land Academy started because of this question. This exact question. People would go to our website, or they’d call us, or they’d see us on various channels on the internet where you sell property, and they would say, “Well, yeah I’m going to buy this 40 acre property for eight grand, but I see you have 22 other ones that are just like it all over the place. How the hell do you buy cheap land? Where do you do that? Where do you buy it? What’s your secret? What’s your business model?” That’s why Jill and I started Land Academy, because we just had overwhelmingly taking this question multiple times a week from people, and so the ones who are serious about it are now Land Academy members, so I wanted to talk about just our basic business model, Jill.

Like where do you buy cheap land? Where do you find it? Is there one place like it’s a well? Do you go and just keep dipping your ladle into that well and taking a drink?

Jill DeWit:                               Yeah, well, it’s this one county.

Jack Butala:                            One secret county?

Jill DeWit:                               It’s one secret county.

Jack Butala:                            Oh, tell me what it is?

Jill DeWit:                               Oh, and it’s only the back taxed one.

Jack Butala:                            That’s exactly how to fail at this.

Jill DeWit:                               Wait, wait, wait. Wait, and I’m the only one that has the list and I’m happy to send it to you for a 100 bucks.

Jack Butala:                            I’m going to ask Google.

Jill DeWit:                               I’ll give you the list.

Jack Butala:                            Okay, Google. “Where do you buy cheap land?”

Google:                                     Sorry, I’m not sure how to help with that.

Jill DeWit:                               Boy, good thing we are.

Jack Butala:                            Yeah.

Jill DeWit:                               Oh, that’s so good.

Jack Butala:                            There’s not one place. There’s not a secret county. What you do is you send offers to owners that are based on a ton of your research and that’s where you buy cheap land. It’s everywhere. The lot next door to you, wherever you are right now might be, you might be able to buy it for half price. The property that’s within a mile now radius of where you are right now, is going to be priced all differently, and what’s it going to be … What sets the price? The sellers situation. Not the asset. I see people make this mistake. We talked about it what, yesterday, or the day before? I see people make this mistake all the time. Where do you buy cheap land or cheap houses? Everywhere. It’s based on a seller’s situation. Maybe they just don’t want it any more.

Jill DeWit:                               Right.

Jack Butala:                            Like a yard sale. Where do you buy stuff at a yard sale? Well, everywhere. It’s way, way cheaper to buy stuff at a yard sale than anywhere else, because they just want to get rid of it. The exact same thing happens with assets like this. Wow. This is a short show. What else do you want? Let’s talk about something fun.

Jill DeWit:                               Okay.

Jack Butala:                            No, seriously. Do you have anything to?

Jill DeWit:                               Cheap land is fun. Cheap land is great, so, no you’re right. That is a short thing. We know how to do it.

Jack Butala:                            It’s hard to convey that topic. People … There’s lots of different reactions that people have the first time they hear that. Even very, very seasoned real estate people, specifically commercial people, where they think you have to improve it.

Jill DeWit:                               I have a point about this though, too. Well, this is what happens sometimes. People that don’t get it think, “Oh, there’s something wrong with it.”

Jack Butala:                            “There’s something wrong with us.”

Jill DeWit:                               “There’s something wrong with us,” exactly.

Jack Butala:                            Cheating.

Jill DeWit:                               We’re cheating, we’re doing it, we’re being bad people.

Jack Butala:                            Yeah.

Jill DeWit:                               We’re going to go to jail.

Jack Butala:                            Why would you ever pay somebody less than what their property is worth?

Jill DeWit:                               Right.

Jack Butala:                            You’re a terrible, terrible, terrible person.

Jill DeWit:                               Right, isn’t that funny? Every time I say, “Have you ever just given something away?” “Heck, yeah. I just want it out of my garage.” I’m like, “Thank you.” It’s the same thing.

Jack Butala:                            Yeah.

Jill DeWit:                               That’s really all it is.

Jack Butala:                            Yeah, so you buy it everywhere.

Jill DeWit:                               Yeah, there’s no secret.

Jack Butala:                            Have you recovered from the holiday season yet?

Jill DeWit:                               No. Have you?

Jack Butala:                            No.

Jill DeWit:                               I’m still on vacation. What are you talking about? I have to rally every day to get some work done right now, because I’m so in, well, it’s between Christmas and New Year’s.

Jack Butala:                            Right. Oh, right, right, right. Yeah.

Jill DeWit:                               Here’s what’s really nice, too, our listeners right now, hopefully most of you are not comuting, because you’re off because it’s between Christmas and New Year’s. It’s Thursday before New Year’s. Jack, what are you going to do for New Year’s, by the way?

Jack Butala:                            I’m going to do whatever you tell me to do.

Jill DeWit:                               You’re so silly.

Jack Butala:                            I don’t know. Do we have any big New Year, like blowout, put his tuxedo on kind of thing?

Jill DeWit:                               Not a tuxedo, but there’s going to be some blowing up stuff.

Jack Butala:                            Really?

Jill DeWit:                               Yeah.

Jack Butala:                            Like fireworks and stuff?

Jill DeWit:                               Yeah, the kids, number two, and number three and, I, and neighbor are plotting to pull out the fireworks that were not used from Fourth of July.

Jack Butala:                            Like demolitions on a beach kind of thing?

Jill DeWit:                               Well, not on the beach, but we’ll come up with a good safe location.

Jack Butala:                            This is my kind of thing. Can I get involved in this? I can be the ringleader.

Jill DeWit:                               By the way, this is a funny point that you just said the other day. I love this. When we were just kind of pre-thinking about this idea, because for some reason, we’re not allowed to do the fireworks on the beach, slash however, it couldn’t be a safer place. Wide open, no trees, sand, and water.

Jack Butala:                            Really [inaudible 00:10:16].

Jill DeWit:                               We should be able to do bottle rockets off the beach if we want to.

Jack Butala:                            That’s a perfect example of the rules in California.

Jill DeWit:                               It’s very interesting.

Jack Butala:                            Logic doesn’t apply.

Jill DeWit:                               You can go out in the desert out here and do it.

Jack Butala:                            Yeah, and start a fire.

Jill DeWit:                               Start a big fire, but don’t you dare do it on the beach with the sand and the water.

Jack Butala:                            That’s the way my parents parented, with that kind of logic. It’s like, “That doesn’t make any sense.”

Jill DeWit:                               Oh, that’s funny. I’m trying to think how my parents, my parents parented by … How did they? Well, I’ll figure it out. It was a lot about figuring out. We’ll be over here.

Jack Butala:                            Join us on another episode where Jack and Jill discuss how to use information, that’s me.

Jill DeWit:                               Inspiration, that’s me.

Jack Butala:                            To 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 cheap land acquisition ambition. Good show. I really want to just make that one point. Like where is it?

Jill DeWit:                               Yeah.

Jack Butala:                            Because we get a lot of questions, and rightfully so from some of the newer people.

Jill DeWit:                               Right.

Jack Butala:                            “Which county should I start in? Where should I do this? Am I picking the right place to start?”

Jill DeWit:                               Very true. It’s true.

Jack Butala:                            It’s a valid question, but I’m not joking about the lot next door, because that’s literally happened to me.

Jill DeWit:                               Yeah. It’s interesting. It’s hard … It’s sometimes the most simple things are the hardest to convey and I haven’t figured that out. I think that people just look for holes in things or something. I don’t know. Sometimes they say, well, you know what it comes back to, Jack? People have said this about us often, that we make things look really easy, and-

Jack Butala:                            Yeah.

Jill DeWit:                               Is it us or do things come that easy to us?

Jack Butala:                            Well, I think that we’re focusing on something that makes sense to us.

Jill DeWit:                               Yeah.

Jack Butala:                            I think that there’s some stuff out there that I would ask questions about, too, but it just makes sense.

Jill DeWit:                               True.

Jack Butala:                            Real estate is the perfect example. That does not make sense to me. It doesn’t make sense to take 6% to 10%, or 12% out of a deal.

Jill DeWit:                               Right.

Jack Butala:                            For posting it on the MLS, and putting a sign in the ground, and some other stuff.

Jill DeWit:                               Right.

Jack Butala:                            It makes a lot of sense to a lot of people. I mean, there’s 1.6 million agents in this country.

Jill DeWit:                               Right.

Jack Butala:                            It makes sense.

Jill DeWit:                               Ask Google.

Jack Butala:                            There’s like … Okay, hold on.

Jill DeWit:                               Yeah, let’s see.

Jack Butala:                            Okay, Google. How many licensed real estate agents are there in the country?

Google:                                     Sorry, I can’t help with that yet.

Jill DeWit:                               Oh.

Jack Butala:                            Okay, Google. How many licensed real estate agents in Arizona?

Google:                                     Here’s a summary from the Phoenix Real Estate Guide. There is one real estate agent for every 153 people living in Arizona. California has almost four times as many agents as Arizona. There you have it. Another number one ranking for Arizona real estate.

Jill DeWit:                               Wow, so wait, wait, wait. Four times as many, so there’s one agent-

Jack Butala:                            Per capita.

Jill DeWit:                               It’s for Arizona, is at one agent for 150.

Jack Butala:                            Right.

Jill DeWit:                               Divide that by four.

Jack Butala:                            Right.

Jill DeWit:                               Oh, my gosh. One agent for every 20 something-

Jack Butala:                            40, 40 people.

Jill DeWit:                               I can’t do the math.

Jack Butala:                            That’s okay. That can’t be right.

Jill DeWit:                               That’s insane.

Jack Butala:                            Okay, Google. How many licensed real estate agents are there in California?

Google:                                     Sorry, I don’t know how to help with that yet.

Jill DeWit:                               Huh, you just did it a minute ago.

Jack Butala:                            Okay, Google. How many agent, stop.

Google:                                     Sorry, I don’t know how to help with that yet.

Jack Butala:                            Okay, Google. How many licensed real estate brokers in California?

Google:                                     Here’s a summary from Cora. Currently, roughly 184,000 active agents and 101,000 active brokers are licensed by the California Bureau of Real Estate. The ratio of active agents to brokers is approximately 1.5 active agents per active broker.

Jack Butala:                            Okay, Google. What’s the population of California?

Google:                                     The population of California was 38.8 million in 2014.

Jack Butala:                            Yeah, so that former stat was totally wrong.

Jill DeWit:                               Okay, so what do you think? One per how many?

Jack Butala:                            Well, it’s-

Jill DeWit:                               I think one per a million is too many. Whoops. Is that my outside voice.

Jack Butala:                            Like some of our-

Jill DeWit:                               It’s the after show. No one’s listening.

Jack Butala:                            Some of our most successful members are agents, but Jill and I don’t make it a secret. They don’t understand the business model. It’s 2016, almost 2017. Like we’re days away. I’m shocked. I firmly believe this and we’re going to let it go after this, because I’m going to get so much email. I do not understand this business model, and the only reason that I still think it’s here is because of lobbyist groups. Because of special interest groups in Washington. I mean it. There’s no reason-

Jill DeWit:                               Right.

Jack Butala:                            To have a real estate agent take 10%, to 12%, to 18% out of your deal.

Jill DeWit:                               It’s like we should still have full-service stations.

Jack Butala:                            Yeah, like that.

Jill DeWit:                               Yeah, but I can pump my own gas.

Jack Butala:                            I mean-

Jill DeWit:                               I can buy my own house.

Jack Butala:                            Yeah, that’s right. It’s not, it’s insulting actually.

Jill DeWit:                               I agree.

Jack Butala:                            Commercial, totally different. I’m only talking about residential, taking 10%, 12%, 15%, 18% out of your house price, that’s silly. I think we should stand in the streets and say, “I’m mad as hell and I’m not going to take it anymore.” That’s what I think.

Jill DeWit:                               I agree.

Jack Butala:                            Information and inspiration to buy undervalued property.

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