Everybody Loves Cheap Real Estate (CFFL 432)
Everybody Loves Cheap Real Estate (CFFL 432)
Transcript:
Jack: Jack Butala with Jill DeWit.
Jill: Hi.
Jack: Welcome to our show today. In this episode Jill and I talk about how everybody loves cheap real estate. Is there anything better?
Jill: Who knew?
Jack: There’s a couple of things, might be better but-
Jill: I don’t know.
Jack: Cheap real estate ranks in the top 3 or 4 for sure. Hey, before we get into it, let’s take a question posted by one of our members on the land … landinvestors.com online community. It’s free, we just changed it.
Jill: Yep! It’s coming. Patrick and Jessica asked, “Hi, as we mentioned before, we’re receiving many signed offers, with deed, that have multiple properties on them-
Jack: Sorry, guys this works-
Jill: And we only want to purchase one. The county is saying that the owner needs to put them on their own deed. Does anyone know if we can have our property … have the property owner record a quick claim deed with him/herself as grantor and grantee for each property. We could prepare this quick claim deed for them and then send a notary, maybe even with the new deed, that passes it to us. Then we could send all into in the county ans ask them to record the quick claim deed first. Thoughts? When acquired a title agent to help, they just want to close the whole deal and won’t do this little part. These are within our first ten deals however, we are seeing many of the them and we would like to be able to know how to do this. Thanks in advance.”
We’ve done this before too, so-
Jack: Thank you for answering this-
Jill: You’re welcome.
Typically, you don’t need a quick claim deed.
Jack: No.
Jill: I know that we all want to really trust and believe that the county is always a 100% right, where whoever answers the phone, they may not be … they may not have been there that long and … won’t even really go there. Here’s how you solve this. Cause Jack and I do it all the time. I will buy properties from one person or one entity, like maybe I’m buying twenty five at one time, but not I’m going try and sell twenty five. Then I’m not going to have it recorded twenty five times, ’cause Jack and I’ve bought properties-
Jack: By the thousands-
Jill: Thousands-[crosstalk 00:02:02]
Jack: Thousands of properties in one day-
Jill: One thousand recorded deeds times 25 dollars is a lot of money. We’re not doing that. To record each one individually. So, no. But when I turn and sell it, I’m only selling one out of that group, which is correct, so they don’t need to do anything, you just need to do one deed showing that one line item, that one property with the proper legal description, it’s the one that’s being now sold to you. And transferred to you.
Jack: Here’s where the confusion happens … we get this question a lot. When you go register a car with a title, you can’t put two cars on one title, right? Well, you can with real estate. You can put 300 properties, a thousand properties, two properties on one single deed. And then, sell them with-
Jill: Separately-
Jack: Individual deed.
It’s a new typical question and it’s a good one-
Jill: It’s a very good question-
Jack: I think we answered it.
Jill: That was awesome.
Jack: If you have a question, or you’d like to be on the show, reach out to either one of us on landinvestors.com.
Today’s topic … this is the meat of the show, by the way. Everybody loves cheap real estate. Jill and I, over the years, have had to fictitiously make up what we do for a living every time we go to a cocktail party or a dinner party, because we have to then answer all these questions, like “what do you mean I can buy a house for way less than it’s worth?” [crosstalk 00:03:27]
Jill: And then they try to give us money, too-
Jack: Yeah. And I’m sure if you’re a member, or if you’re in the business at all, you’ve had to do this too, because you can’t … you end up just talkin’ about the whole thing. Plus to make it worse, we have a talk show about it. Then there’s questions about that: “So, what’s your latest show?”
Weren’t you like a valet for a while?
Jill: Yeah, I did that for a while-
Jack: She parked cars for like the NBA or something-
Jill: I did. I designed parking lots, cause someone’s got to figure out how those stripes go in the mall parking lot. I’ve done that job. Let’s see, what else have I done?
Jack: So what do you think the fascination is with people in … that are in love with cheap real estate? Cause I’m one of them.
Jill: Well, I think the bottom line is, it’s something that everybody is interested in. I don’t care who you are, buying an asset like this especially, for way less than retail, piques everybody’s interest.
Jack: Less than half-
Jill: You’re a little old lady grandma and it piques your interest. Like “What do you mean I can buy the ranch next door for way less?” “Yeah, you can.” So that’s … that I think is what starts it. And then, what happens is they don’t … understanding and grasping that it really exists …. then they have all these questions about the process, and it’s just like, “oh, no”-
Jack: They go through like the five stages of grief. Anger, denial … and finally they accept it.
Jill: Acceptance-
Exactly. Bargaining-
Jack: Yeah, Bargaining. That’s right. [crosstalk 00:04:56][inaudible 00:04:55] “That’s not true.”-
Jill: Anger, denial, bargaining, yeah, acceptance. We’re missing one … I don’t know what it is-
Jack: I’m going to get a million emails on this. Yeah, we could google it; we’re not.
If I went to a dinner party and somebody said “You know, want we do, we buy diamonds for half.”
Jill: Could you imagine … “that’s a beautiful ring”-
Jack: What do you mean buy diamonds for half-
Jill: “Isn’t this great? He spent 12,000 dollars.” Well hey he could of got it for 6 … I could’ve got it for him for six. They’re like “what?!”
Jack: No one wants to here that.
Jill: No, but-
Jack: Yeah, you paid too much for your house.
Jill: Yeah, you paid too much for your watch.
Jack: You paid too much for your wife.
That happens.
Jill: Right. Oh, gosh don’t go there.
Jack: To make this not just a silly podcast episode, what do you think it really is about cheap real estate? There’s something about land. That’ [inaudible 00:05:42] show is about. There is … land is like … I’m mean there’s been wars over human history over land and property and it’s just … it gets to the root of everything. I just love it-
Jill: You’re right-
Jack: I love the business [inaudible 00:05:56]-
Jill: There’s a safety and securance, having a piece of land that you could put a fence around and stand in the middle and no one can bother you, vs. even having a very … full to rim with gold safe. Having that in your closet. There’s some thing different … you’re right, it triggers something in all of us that’s very safe, I think, secure, comforting, knowing that-
Jack: Comfortable balance sheet item too-
Jill: But knowing that, if everything else goes sideways, I got a place to go and that’s mine and no one can take it away from me.
Jack: Right.
Here’s some of the conversations I’ve had other the years with people … some quirky stuff about the business ran and about land and real estate.
“Well, you never … in this country, you never really own land, because you have to pay taxes. You don’t really own it. The government really owns it.” That’s malarkey.
Jill: I agree.
Jack: Here’s another one: “I’m a socialist, I don’t think people should be able to own land at all, like in communist Russia. Government should own everything and provide for us.” That’s a bunch of malarkey.
Here’s another one: “Why are you badgering these poor people and sending them offers …. you’re extorting them”.
Jill: Yes.
Jack: Oh, really? I’m putting a gun to their head and making them sign it? Here’s the truth about that if you’re new in this. These people thank us. “I didn’t know what I was going to do with this thing. Thank you for taking it off my hands”-
Jill: “Oh my gosh, I’m so happy”-
Jack: “God bless ya, I hope you make a ton money in this thing.”
Jill: “How fast can we do it?”
Jack: “I’m so tired of paying taxes on this thing.”
Houses too: “Thank you so much for sending a letter, we just didn’t know what we were going to do. We need this money.”
Jill: And “I wanted to downsize”.
Jack: Here’s the thing about it, and Jill’s a huge stickler on this. We don’t send them a letter that says “We’re going to foreclose on your house and you’re a terrible, terrible person for this.” No. We send a respectful letter that says, “We’d like to pay to 80 or 90 thousand bucks for your 120 thousand dollar house. We know it’s worth 120, you know it’s worth 120, but think of this as a check cashing company, and if you want to get out of it real fast and not have to fix the plumbing and the whole thing, we’ll get cash out on Thursday. Very respectfully. If you don’t want to do the deal, I totally understand, I’ve got nineteen more right below your … piece of paper here on my desk.”
Jill: Uh huh. Throw it away.
Jack: So that’s it. What’s more … everybody loves that.
Jill: Isn’t that funny.
Jack: Everybody … on all sides of every deal that we do, loves the transaction or they don’t do it. We are not shy to absolutely walk away from a deal because there’s … for some reason uncomfortable.
So once in a while, we get a couple of call … we get a call from an angry son that says “You sent my elderly mother a letter. You’re trying to take advantage of her.” I usually get involved … we have people answering our phones and all that stuff and that happens. I get involved and I calm the guy down. Because I don’t want anyone to think that ever.
Jill: Oh, yeah, no.
Jack: Nobody’s trying to take advantage of anybody.
Jill: Yeah, haven’t had that though …. It’s few and far between. And like you said, if they’re not interested, then they just throw it away and that’s fine. I move on too. They move on, I move on.
Jack: Our whole organization, Land Investors, we talk about sales, selling the property, like 5% of the time. We talk about buying the property like 95% of the time.[crosstalk 00:09:20] Buying the cheap real estate-
Jill: Why is that?
Jack: Cause when you buy it real cheap, it sells itself.
Jill: Exactly.
Jack: Usually you could sell it to the neighbor.
Jill: People … That’s the funniest thing that people come along and they ask me, you know when we’re doing like consulting calls or something. People are thinking about this and they have a lot of questions. The one thing is well, “Talk to me about marketing and selling.” I’m like, “That’s the easy part.” And they’re like “What do you mean, that’s the easy part?” I’m like, “Trust me.”
Jack: What does that say? They’re worried about it aren’t they?
Jill: They are-
Jack: Like, “I don’t want to be stuck with all this land.”
Jill: They think that you have to … because some of the people I know in our world have been told by individuals that you better be a good writer and you better know how to describe the property well and do all the stuff … or it’s not going to sell. Which is so not true, it’s not even funny.
Jack: Look, if you put an assessor’s parcel number in a state, county on Land Pen, which is a website Jill and I are on to sell real estate, and you put the fact that it’s half price and a picture of the area … it’s half the price that it’s worth, it’s gonna sell like in a week-
Jill: And you spell everything wrong-
Jack: Yeah-
Jill: You’re still going to be fine.
Jack: Exactly. So, believe me, there is no issue with sales. Even during the worst downturn. We were selling property. We weren’t selling it for as much, but all we did[crosstalk 00:10:32]
Jill: We were still making money-
Jack: We adjusted our purchase price-
Jill: We always made a profit.
Jack: Even during the worst downturn, you just buy it cheaper and sell it cheaper. The whole thing moves down. Right now we are in what I think is a pretty serious peak in the market … the economy all the way around. We’ve never paid more and we’ve never sold it for more. You just adjust. I love cheap real estate. All of it. I love it.
I don’t like office buildings. Everybody’s got a thing. I don’t know why. I just don’t. I love apartment buildings, residential houses-
Jill: I would think the tenants-
Jack: I love townhouses.
Jill: Are you talking about buy’em and holding them. Or just flipping them?
Jack: I don’t like office buildings. I don’t even like to look at them. I don’t know why.
Jill: That’s really weird.
Jack: I know.
Jill: Ooh, office space gives you a rash.
Jack: That’s what it is.
Jill: Kind of like coach seats give you a rash. “I can’t sit in coach, I get a rash.”
Jack: You know small boats give me a rash.
Jill: I got it.
Jack: Certain kids … one of the three children that we have gives me a rash, but they don’t know which one.
Jill: You don’t really have a dog allergy, you just don’t like dogs.
Let’s just call a spade, a spade here Jack.
Jack: I have a rash about white wine, too. Or you have a rash about-
Jill: Or cheap wine. I have a rash about cheap wine. Just kidding.
Jack: Yeah, you do actually-
Jill: I do-
Like “I’m not drinking that. It’s pink!”
Jack: Here’s a secret about Jill … we live in California. She refuses to drink California wine.
Jill: I don’t anymore.
Jack: I shouldn’t be saying this on the air-
You don’t anymore?
Jill: I don’t anymore.
Jack: She only drinks European wine.
Jill: I used to. I’ve changed my ways. There is a difference.
Jack: I agree.
Jill: There is something … there is … it’s a difference.
Jack: We’ve got to get to the bottom of that. If you drink a lot of wine-
Jill: [inaudible 00:12:15][crosstalk 00:12:15]wine snob.
Jack: If you’re like a wine snob and you know if there’s something different about the soil or … I would love … can you email us? I’d love to know.
Jill: You know, I bet Kathleen knows. If Kathleen’s listening, she knows.
Jack: I bet.
Jill: I love Italian and French wines. There we go.
Jack: Right. Not even South America or anything?
Jill: No.
Jack: Wow. I learned something about you today.
Jill: There you go.
I have bought wine … I have poured wine down the sink-
Jack: So have I-
Jill: Traveling in other countries, going “What is this?”
Jack: Exactly.
Join us in another episode, where we are probably going to talk about something a little bit more substantial than this. That’s information.
Jill: And I want to try my best to keep it all together. That’s inspiration-
Jack: Try to stay awake-
Jill: That’s me.
Jack: You are not alone in your real estate ambition.
That wine thing’s a crack up.
Jill: Oh, Thank you.
Jack: Yeah, …. there’s nothing better than buying cheap stuff. I’ve been in a lot of businesses in the past where you buy inexpensive … things that are less than the value of the … what you sell them for and there’s just nothing like real estate. I don’t know why. You don’t have to ship anything, first of all, which is really helpful. Except paper.
Jill: I’m still on the wine thing, but okay.
Jack: Oh, go ahead.
Jill: No, I don’t think it’s a … necessarily you get you pay for, but there’s differences in the regions and the wines and I swear I don’t get the headaches and stuff the next day. Like today.
Jack: Oh my gosh, we made some friends last night.
Jill: Yes, we did.
Jack: Information and inspiration to buy undervalued property.
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