3144 US Counties – Is There Enough Land for Investment? (CFFL 389)

3144 US Counties – Is There Enough Land for Investment?

Jack Butala: 3144 US Counties – Is There Enough Land for Investment? 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 DeWitt.

Jill DeWit:                               Hello.

Jack Butala:                            Welcome to our show today. In this episode Jill and I talk about 3,144 U.S. counties. Is there enough land for investment to go around?

Jill DeWit:                               Well, I’ll take this half. You take that half.

Jack Butala:                            I love this topic. This is kind of a Jack show.

Jill DeWit:                               Uh-huh (affirmative).

Jack Butala:                            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:                               Cool. All right, Gary asked, how do you handle land locked parcels that are great in every other way? Do you automatically pass on those deals? If not, how do you advertise them when you’re selling?

Jack Butala:                            Excellent question Gary. I haven’t talked about access in a while. So, we judge and we talk about with our members all the time looking at property and going through their review process with the four A’s, acreage. So, more is better. More acreage is better. Access, more is better. Attributes like, is it close to a river? Can you see the mountains? Is it close to a city? Or in some cases far from the city which we’ll talk about in a second, and what’s the fourth thing? Oh, affordability. The cheaper the better. You always want to buy undervalue. Always. Even if you’re the end user.

So, this is about access and here’s the thing. We don’t use the word landlocked, ever. We just don’t because I don’t even know what it means. Even after how many, 20 years in this business I’m not so sure what it means. In fact I don’t think actually it exists in most places. Places like Arizona and California hae statues that say, you cannot reasonably withhold access to a property. An adjacent property owner cannot reasonably withhold access to another property. So, there’s no such thing really, I’m going to get a million emails for saying this, but a million, no such thing as property that you cannot access.

Jill DeWit:                               Right.

Jack Butala:                            So, to answer your question if it’s got the other three attributes in a big, big bad way you know, we kind of say, look, one of the, the property has to have one of the attributes knock it out of the park. Like it’s oceanfront.

Jill DeWit:                               Right.

Jack Butala:                            Oh, but it doesn’t have access. Well, but it’s oceanfront. So you’re going to really take a good look at that acquisition anyway.

Jill DeWit:                               When you’re new we always say you want like a three of the four. Let’s be, let’s be safe here.

Jack Butala:                            Right. So, if a property doesn’t have apparent, legal, or physical access, you know I, if it’s got all the other stuff I’d buy it. We buy it anyway and we talk about it, it’ll need to, you never want to withhold any information. Ever. If you know something that can materially affect the decision of a land buyer you put it in a posting.

Jill DeWit:                               Yeah, because you don’t want them coming back to you six months later when they see it and then you’re in a pickle. You want to be really up front and honest.

Jack Butala:                            How would I post this, personally? I would say, this property is awesome in these three ways. It’s super cheap, it’s got a lot of acreage, and it’s whatever the attribute is.

Jill DeWit:                               Views.

Jack Butala:                            Views.

Jill DeWit:                               Next to a mountain.

Jack Butala:                            360 degree mountain views.

Jill DeWit:                               Right.

Jack Butala:                            Access has been un-researched and then I would probably in the posting follow it up by saying, if you’re one of these people who really wants to get lost, they want to buy a piece, because we have a ton of customers who really don’t want, they want property that …

Jill DeWit:                               They want to be really off the grid.

Jack Butala:                            Yeah.

Jill DeWit:                               Like, good luck finding me off the grid.

Jack Butala:                            Then, that, this property is going to appeal to them.

Jill DeWit:                               Uh-huh (affirmative).

Jack Butala:                            So, any, but you don’t, you know, you never want to do this. Oh, wife this property has, don’t, shh don’t tell anyone. We’ll just see if we can slide it under the rag and sell it.

Jill DeWit:                               Exactly, because it’ll come back.

Jack Butala:                            Never ever do that.

Jill DeWit:                               Well you know, another thing that we have done in the past which I really appreciate Jack is when you would make the property videos as we’re posting them you would get in and show. You would show, here’s the road. I can see this and here’s a wash and look and you can tell, I mean we all tell on Google Earth, people have driven on it. You can zoom in and see the tire marks.

Jack Butala:                            Two tracks. Yeah.

Jill DeWit:                               So, you can say hey, I can see that the, it stops here so and I can measure right now, that looks like a hundred yards. So, then that person really knows, okay I can tell, someone can get up to that close to it and then I can blade the rest or you know, walk to it from there or whatever it is and none of it’s crazy but the big thing that Jack just said too, just be, disclose it all. You want to be, you want that buyer to know exactly what they’re buying because most of your buyers are buying it sight unseen.

That’s another thing that I don’t think people realize in our world is that a lot of these buyers they see the property, they research it, they do the maps and everything like that and they don’t always drive out there to see it before they pull the trigger. They’ll often buy it and say, [inaudible 00:04:51] we’re going to go see it this summer. That’s how it goes and you don’t want them to go out there this summer with their RV and six families in tow and they can’t get to it. Then we’re going to have a problem and they’re going to be calling you. So, you want to, to put it all up front.

Jack Butala:                            Here’s a bit of realistic advice on this topic and we’ll close it out there. You have an obligated, moral and probably a legal obligation, especially if you’re a licensed agent to disclose what you know. The last part of that sentence in quotes, “what you know”. So, if you’d like to make 15 calls to the county and really dig in to what the access situation is, the more you know the more you’re obligated to post. Think about that for a second. Am I saying cheat, lie, steal? No, no, no. I’m just saying, we have not researched the access of this parcel. Please do not buy this property unless you thoroughly are satisfied with the results of your due diligence, specifically regarding access.

Jill DeWit:                               Perfect. Love it.

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, 3,144 U.S. counties, provinces, districts, parishes. There’s 3,144 of all of them. Some of them are called counties. That’s my point. Is there enough land for investment? Is there enough land to go around? Am I too late? You’ve been doing this for 20 years. Are all the good flips gone? These are questions that Jill and I get on a daily basis.

Jill DeWit:                               I like that one is, well you guys have taken all the good ones.

Jack Butala:                            Is that why you guys really have Land Academy, because you just did, have done all the flips, and we can’t make any money on it anymore and it’s a big pack of lies?

Jill DeWit:                               It’s so funny.

Jack Butala:                            On a daily basis both of us get questions, you know, on this topic. Is it over? Am I too late?

Jill DeWit:                               So funny.

Jack Butala:                            What’s your answer, Jill because I have a lot of answers. I’m going to give the ones without the expletives on this show.

Jill DeWit:                               Okay. That’s hilarious. You’re cracking me up here. Okay, so here are my answers. The first thing I say is if we, everybody, by now you know how data driven Jack is and how much he researches everything to the point of oh my gosh. So, if we did not strongly feel that there was enough property to go around we would not be here. I mean, I was going to say, my opening line was let’s do some math. I mean, when you think about that many counties and you split up how many possible property types and sizes can be in any one county, like I kind of could have a million different property types and different things. L.A. County. I wonder how many, I wish we knew. I wish we knew just in L.A. County, because I don’t know off the top of my head, how many separate APNs there are in L.A. County.

Jack Butala:                            There’s 145 million parcels ish in this country.

Jill DeWit:                               Okay.

Jack Butala:                            If you divide that by the number of counties it’s about 50 thousand. 45 to 50 thousand properties per county. Now obviously there’s big counties in Texas and small counties in New Jersey.

Jill DeWit:                               Right.

Jack Butala:                            You could spend, all of us, if all of us in this whole group from now until forever only focused on one county in the very lowest price we would all succeed. On one county. Not one state.

Jill DeWit:                               Exactly. I love too with the number of members that come to us who are doing deals and they’re doing fantastic and they, they did everything right, they did their own research and they’re coming to us with counties I’ve never heard of.

Jack Butala:                            I love that too.

Jill DeWit:                               I’m like, where is that? I don’t even know.

Jack Butala:                            Man, i love it. This is like, I love these emails and this calls. You know what, Jack, we did this this and this and we went over here at the let’s say, I’m just pulling out of my hat, Ohio and we went to this county and did, and we sent, sent it out and we’re buying 14 properties. I’m like, that was so, never on my radar, Ohio.

Jill DeWit:                               Awesome.

Jack Butala:                            Then, they usually follow it up with, because we have a buyer and this guy collects land and he’s a developer or an, members in our group who buy property on the outskirts of urban towns and sell them to like, home builders, because they’re old. The home builders staff literally, doesn’t know how to buy property as well as we do.

Jill DeWit:                               Exactly.

Jack Butala:                            I got a call like four months from this huge home builder and said, can you please come and teach my idiot executive land buying acquisition staff how to buy land, because they don’t know how to do it?

Jill DeWit:                               They don’t. It’s very true.

Jack Butala:                            They’re thinking they’re supposed to get on the phone every morning.

Jill DeWit:                               Yeah. You said that to someone once before and I love it that if you just want to be an acquisition machine and do things for other people you don’t have to put up the money. You don’t have to do that because the talent, the knowledge that you have is so valuable, just knowing how to source these and get them to come to you.

Jack Butala:                            So, I know Jill and I are being a little cynical about this but there’s enough property to go around.

Jill DeWit:                               It really is.

Jack Butala:                            Here’s the variable. If there’s one takeaway from this, please retain this. Is there enough property to go around nationwide if we all mail 50 dollars an acre out? No. Probably not.

Jill DeWit:                               Uh-huh (affirmative).

Jack Butala:                            The variable is price. This works in every single county but it is, you have to price the mailers logically and we talk all about it all throughout these shows, and all throughout the programs and the weekly calls on Thursday. How to price real estate is the key to this.

Jill DeWit:                               Exactly.

Jack Butala:                            You can’t just price it. You can’t flippantly price real estate and send a mailer out and expect it to work.

Jill DeWit:                               Exactly, and we’ve talked about that like, the big acreage and you now, gorgeous Santa Barbara acreage, you’re not going to send that out. You’re going to send it out for thousands of dollars an acre.

Jack Butala:                            Thousands of dollars an acre.

Jill DeWit:                               You know it’s worth, it might be worth six thousand dollars an acre, so you’re coming in at four. Something like that. That’s what you’re doing, and then it all works.

Jack Butala:                            That’s right.

Jill DeWit:                               Uh-huh (affirmative). It all works.

Jack Butala:                            I mean, that was a fast show.

Jill DeWit:                               It really was. I’m trying to think of it as, it’s funny. Well no, it’s just so funny that this comes up. They keep, well here is why I think this comes up. I have heard of people saying, okay I, and you’re going to know where I’m going with this in a second here. Okay, I sent out some offers and I got a call back from a guy and the guy said I’m the third one that’s contacted him and so, it’s always the same thing and so my thing’s let me guess, are you only hitting tax delinquent properties?

Jack Butala:                            It’s always back tax property.

Jill DeWit:                               They go, yes I am and I said, there’s your answer.

Jack Butala:                            Yeah, you want to know what’s saturated out there, when people get too much mail? Back tax, people who own properties with associated back taxes, owners get a lot of mail.

Jill DeWit:                               Yeah. They do. Including us.

Jack Butala:                            Or if it’s a foreclosure. Yeah. Exactly.

Jill DeWit:                               I get them.

Jack Butala:                            Or a foreclosure property. If somebody’s in foreclosure with a house, not land, they’re going to get a lot of offers and a lot of correspondence because for whatever reason and it’s a hundred percent incorrect way to do this.

Jill DeWit:                               Uh-huh (affirmative).

Jack Butala:                            Lots of investors are taught to specialize. Specialize in back tax properties, specialize in tax liens, specialize in foreclosures. Specialize in divorce, specialize in obituary, in death.

Jill DeWit:                               Well, I think that they’re taught that that is the number one trigger and I’m here to tell you, that’s not the only trigger.

Jack Butala:                            That’s the last trigger. Back tax is the last trigger. It’s not the last but it’s pretty far down the list.

Jill DeWit:                               Yeah.

Jack Butala:                            What’s a good trigger?

Jill DeWit:                               I just inherited it.

Jack Butala:                            Yep. Inheritance. Death.

Jill DeWit:                               My parents passed. I don’t know what to do with it. I didn’t even know they had this. I get it all the time.

Jack Butala:                            You know what a good trigger is? Getting an offer with a purchase price in there in the mail.

Jill DeWit:                               Right.

Jack Butala:                            That’s a good trigger.

Jill DeWit:                               Well, you know what?

Jack Butala:                            Where you caused the trigger, you cause the situation.

Jill DeWit:                               How about this too?

Jack Butala:                            How much control is that? It’s a ton. It’s awesome.

Jill DeWit:                               Yeah. Well, like you said, like in my situation the same, I just inherited. We don’t go trolling the obituaries by the way. Don’t even bother. I mean, that’s the whole beauty of it. We have this, if you really want to do this and you’re going to do this right you will seek out cheap data and cheap mailers so you can afford to blast the universe, because that’s really what you’re doing. We’re blasting a lot, we’re doing a wide net to see what comes back so I can pick them. I’m not just going through the obituaries and doing ten here and five here and six there and all that. Uh-uh (negative). I’m not messing around.

Jack Butala:                            So, and the number’s really work. So, you know, the mail company that we have for our group it’s 49 cents which is the price of a stamp. Right?

Jill DeWit:                               Uh-huh (affirmative).

Jack Butala:                            To get something in the mail. That includes everything. The mail [inaudible 00:13:40], the paper, the toner, the, all the work. Right? All you supply is the data. All you supply is the people you, the list of the people that you’re want to send the offer to and the actual document itself. So, is it cost effective? Well, we’ve been doing it for years and years and years. I think a lot of this Jill comes from people who are just trying to save 200 dollars in a mailer.

Jill DeWit:                               I know.

Jack Butala:                            I just want to send out three or four hundred of these and I want to buy two or three, I’m sorry. You have to keep moving. That’s not, this isn’t going, you have to be willing to do what it takes and learn and have a website. You’re not going to get any response. If you go do this to “test it” without a website, without any experience, you don’t really have a phone number set up and you send out ten thousand letters, we have people who try to do this. Ten thousand offers. It’s good, you’re going to get all kinds of stuff sent back to you and it’s going to be a mess.

Jill DeWit:                               Uh-huh (affirmative). Yeah, do it right.

Jack Butala:                            You have to do it the right way like everything.

Jill DeWit:                               You know what, you spend the, if you spend the 200 dollars up front it’s going to help you with ten thousand dollars on the back end. Let’s be honest.

Jack Butala:                            If you have a Lexus do you, and you need a transmission for it do you put a General Motor’s transmission in there? No. That’s what people sometimes try to do, that kind of crazy stuff.

Jill DeWit:                               That’s funny.

Jack Butala:                            Just because you have one laying around? No. You go get a Lexus transmission and you find somebody who knows how to do it.

Jill DeWit:                               Right.

Jack Butala:                            That’s just common sense. You know? You don’t rush through brain surgery.

Jill DeWit:                               Right. You know what’s interesting too is the people that got an offer six years ago and now they’re getting an offer, they may have never got one or they, maybe they got one six, ten years ago from us. So, I don’t know and now our people are mailing them an offer. Maybe now is the right time. You know? You never know too, so there’s so much land to go around. Yes, you can make more land. We talked about subdivisions. I mean, there’s all kinds of things. It’s, this is not a fad. This is another thing that you and I talked about, because so here is where I went with this now.

This is my last point or, when you and I sat down to share what we know with, we were doing it for years with just our wholesale buyers and kind of helping them out a little bit and it worked out great and that’s where it came in, it just grew in Land Academy. So, when we sat down and said, oh my gosh, what are we, are we crazy? Opening up the flood gates and potentially creating competition for ourselves and telling everybody else how to do it and now it might take away properties from us? So, we set and did the math for real and we have said holy cow, there is enough of this to go around. So …

Jack Butala:                            All we did was create business partners.

Jill DeWit:                               That was the end result.

Jack Butala:                            I mean, that’s one of the real reasons we’re here doing this. I mean, aside from the fact that we love to see people succeed. Really. There’s a few people in this group, probably 15 that are unbelievable business people and there’s new ones coming in all the time.

Jill DeWit:                               Uh-huh (affirmative).

Jack Butala:                            We do deals with them because they’re awesome.

Jill DeWit:                               Exactly.

Jack Butala:                            They’re smart, frankly smarter than us about some stuff.

Jill DeWit:                               They need a little something or they need a little backing or whatever it is and we can help with that.

Jack Butala:                            Right.

Jill DeWit:                               That’s been the beautiful result of all of this.

Jack Butala:                            Here’s my final point. Every year, sometimes twice a year these people get tax, the owners of this, well 145 million tax bills go out. So, and every year people say, John, I got a tax bill for that 40 acre property in Nevada again. Are you ever going to do anything with that, because I am so sick of writing this, this Jack. Oh, Len, I’m sorry and then right next to it this time Len has got an offer. Well, I’m not writing Jack this time.

Jill DeWit:                               I’m calling.

Jack Butala:                            I’m calling these people. They’re going to give us 5,000 dollars for this thing and we’re going to be done with it. Okay?

Jill DeWit:                               We’re going to Hawaii.

Jack Butala:                            All right. This is John. You know, you’re right. You say this every, for 25 years you’ve been saying this. Okay. Let’s just get rid of it.

Jill DeWit:                               That’s a little role play.

Jack Butala:                            That’s the thought process. It’s not, you know, maybe we should get more money, maybe we should get less money. It’s, that’s really what goes on. That’s the reality of all of this. It’s the same thing with houses. It’s the same thing with apartment buildings. It’s the same thing with assisted living facilities and it’s the same thing with office buildings.

Jill DeWit:                               Yep.

Jack Butala:                            The bargains. The people who spit shine it up put it up, get it, you know a rural class commercial real estate broker spit shine the office building and sell it on a cap rate. That’s different. That’s not what we’re going for.

Jill DeWit:                               Uh-huh (affirmative).

Jack Butala:                            We’re going for the person who has four tenants in an office building and he’s so tired of dealing with this bad tenent that he’s willing to sell it for anything.

Jill DeWit:                               Maybe the bad tenent is him.

Jack Butala:                            Maybe the bad tenant’s like a figment of his imagination. Like, he has finally gotten so old and crazy that he sees things.

Jill DeWit:                               Yeah, maybe that’s it.

Jack Butala:                            So, maybe he, like some of the people who call us back on these letters maybe they see two extra zeros in the offer.

Jill DeWit:                               Oh, [inaudible 00:18:39] that’s true.

Jack Butala:                            I thought you meant 450 thousand dollars, not 4,500 dollars.

Jill DeWit:                               Exactly.

Jack Butala:                            No. I meant 4,500. Have a nice day.

Jill DeWit:                               No, that was correct. Love it.

Jack Butala:                            Join us in 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 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. That’s going to cause more questions.

Jill DeWit:                               You thing so?

Jack Butala:                            Then, over less. Yeah.

Jill DeWit:                               Oh, I thought that was good.

Jack Butala:                            No. It’s a, you know what, it’s a natural, I had, when I started out I wondered that. Was it over? Am I too late? This was in the ’90’s.

Jill DeWit:                               Yeah.

Jack Butala:                            I think it’s a very natural, healthy question to have.

Jill DeWit:                               It’s true.

Jack Butala:                            It’d be better though if they asked, just went onto to Success Plant and asked it.

Jill DeWit:                               I love it.

Jack Butala:                            In fact, maybe we should do a really lengthy Seth Williams typed blog you know, that’s like 14 pages long.

Jill DeWit:                               You have done, well, not that long but you have done a blog on this. I know that we have blogs on this on our website.

Jack Butala:                            We did one in Texas.

Jill DeWit:                               We did?

Jack Butala:                            Remember we had, we just deconstructed texts …

Jill DeWit:                               To use an an example to say, but imagine what else is out there. You know? So, I don’t think that’s crazy.

Jack Butala:                            Information and inspiration to buy undervalued property.

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