Property Data Quality Then and Now (LA 813)

Property Data Quality Then and Now (LA 813)

Transcript:

Steven Butala:                   Steve and Jill here.

Jill DeWit:                            Hi.

Steven Butala:                   Welcome to The Land Academy Show, entertaining land investment talk. I’m Steven Jack Butala.

Jill DeWit:                            And I’m Jill DeWit, broadcasting from sunny Southern California.

Steven Butala:                   Today Jill and I talk about property data quality, then and now. It’s Data Week this week.

Jill DeWit:                            It is.

Steven Butala:                   In case you haven’t noticed. Yeah.

Jill DeWit:                            Do you know what’s funny? Is it just me, or do we have six Data Weeks a year? Maybe it’s 10. I can’t remember, but it’s a pretty high number.

Steven Butala:                   I wonder … I haven’t checked our … You know, I used to obsess-

Jill DeWit:                            It’s Data Week again.

Steven Butala:                   We get feedback on how many people listen to the show daily, and a number. I haven’t checked, because it keeps going up really well.

Jill DeWit:                            Yeah.

Steven Butala:                   I stopped checking, and if I wonder if it just dramatically drops during Data Week.

Jill DeWit:                            Oh, we shouldn’t advertise that. Just slide it in there.

Steven Butala:                   Here’s the truth, Jill and I constantly go back and forth just like should we be a teacher or should be we be an entertainer? And you decide.

Jill DeWit:                            Yeah, because we’re probably good at one, and we probably stink at the other one, and you know. We’d love to know. You should-

Steven Butala:                   In fact-

Jill DeWit:                            Tell us-

Steven Butala:                   We’re probably saying-

Jill DeWit:                            Please tell us.

Steven Butala:                   We’re saying to people who don’t listen to the show any longer.

Jill DeWit:                            No.

Steven Butala:                   They don’t even know that-

Jill DeWit:                            They’re not here.

Steven Butala:                   They’re not hearing that sentence.

Jill DeWit:                            There we go.

Steven Butala:                   When you guys figure it out, let me know.

Jill DeWit:                            Yeah.

Steven Butala:                   Today’s topic … Well, no before we get into it, let’s take a question posted by one of our members on the LandInvestors.com online community. It’s free.

Jill DeWit:                            Okay. Steven asks, “For those of you regularly using Zillow, do you put all of the normal listing information like you would on your website, or is it beneficial to leave some information off, like the cash purchase price, if you can post a low per month terms payment instead? I know some like to put minimal information in a Craigslist post, so I’m wondering if any benefit when doing Zillow ads.” This is clearly a part … I’m about to-

Steven Butala:                   Oh, an online sneeze.

Jill DeWit:                            Excuse me. I sneezed.

Steven Butala:                   How’s that for reality of telling the truth? I will not edit that out.

Jill DeWit:                            Sorry about that.

Steven Butala:                   By the way, is it healthy to just not let … to let that out?

Jill DeWit:                            Here we go. I’m not-

Steven Butala:                   Since the day I met Jill-

Jill DeWit:                            We don’t agree on sneezes.

Steven Butala:                   This little internal sneeze really concerns me. I say let it out of there.

Jill DeWit:                            Yeah, I know. That’s why I walk around with wipes, and I wipe things down where you’ve been.

Steven Butala:                   I’m not criticizing you.

Jill DeWit:                            Kidding.

Steven Butala:                   I just don’t want you to hurt yourself.

Jill DeWit:                            It’s not going to do any damage.

Steven Butala:                   Okay.

Jill DeWit:                            I’m positive.

Steven Butala:                   I bet it is.

Jill DeWit:                            No, I think it’s better than spraying your sneeze.

Steven Butala:                   I’m not saying … okay.

Jill DeWit:                            You’re supposed to [crosstalk 00:02:38]-

Steven Butala:                   I’m not saying spray.

Jill DeWit:                            You’re supposed to put it in your arm, but I wasn’t going to do that on the show.

Steven Butala:                   Is that right?

Jill DeWit:                            There we go. I could have gone like this. It would’ve been funny.

Steven Butala:                   You know what you can do next time, is just …

Jill DeWit:                            I could have done-

Steven Butala:                   I’m your man for a reason. You can sneeze right into me.

Jill DeWit:                            You know what? That’s what I should have done. I should have … people who are listening and not watching, I should turned to my right, buried my head in your neck-

Steven Butala:                   And sneezed.

Jill DeWit:                            And on your shirt, and sneeze.

Steven Butala:                   And I would be happy. And then we would have a viral show probably.

Jill DeWit:                            Thank you. That was good. I already forgot the question. Oh, Zillow ads. So, there’s clearly a long discussion in one or several forums, which is exactly why we have this online community by the way, is to discuss this stuff and learn from each other. I truly don’t see the value of providing less information-

Steven Butala:                   That’d be great.

Jill DeWit:                            However, if you read these forums and follow these topics, I am sure you’ll have people weighing in with pros and cons of both. That’s the whole point. Our goal is to minimize the conversations and put as much information as I have on the property out there to everyone so the only questions they’re calling about is, “Wilma, how fast can I get a deed? I’m about to push the button,” kind of thing. Or, “I want it. Can I give you a down payment now? I’m wiring some money, and I’ll have the rest tomorrow morning,” kind of thing. Those are the questions I want, not, “You know, I’m really not sure because this part isn’t in this posting. Can you tell you me X?”

Steven Butala:                   Here’s how you sell a piece of property on the real estate regardless of where it’s posted. You buy it right, and then you get everything together, all the pertinent information together regarding this property, including if you do it perfectly, including a fly over video and multiple pictures of the property, hopefully even an infographic and then all the … it’s just like zoning and all that. That’s why we created Land Pennant so that becomes your template, because when you post a piece of property on Land Pennant, it will not let you post it unless you come up with all this information, and create a value for zoning and square footage, and all it.

So, that’s your template. That takes the majority of the effort and time, which by the way you can outsource once you do it a few times and explain it somebody else at $4.00-$5.00 an hour overseas. At that point it doesn’t make any sense to not use all that information and put it all over the Internet, Land & Farm, Land Watch, Zillow, Trulia, all of them. I believe you’re asking this question to bait the potential buyer. If only I give them just a little bit of information, that skip along the top and bait them-

Jill DeWit:                            Right.

Steven Butala:                   So that they have to call me to get more information, or get the price or any of that, then I can capture their attention and sell them.

Jill DeWit:                            Right.

Steven Butala:                   And that will backfire-

Jill DeWit:                            Backfire-

Steven Butala:                   On about your third or fourth property because what you’ll get is a lot of tire kickers instead of real people.

Jill DeWit:                            That’s just what I was going to say.

Steven Butala:                   Which is really what Jill was saying. In a perfect world, you don’t want to talk to them at all. You drive the traffic from Zillow to your website, where your property is posted, and they click on it and get their credit card out of their wallet and buy it.

Jill DeWit:                            Could you even-

Steven Butala:                   Or they put a down payment on it.

Jill DeWit:                            Can you imagine if Ebay, or not Ebay, let’s just say Amazon’s whole thing was if you want this product, call here?

Steven Butala:                   Yeah, and we’ll talk about it.

Jill DeWit:                            Exactly, it’d be just like that. We would not be using Amazon.

Steven Butala:                   Yeah, it would never work.

Jill DeWit:                            We love Amazon because all the information is there, including reviews, and I look at those reviews. I know everything about it, how fast it’s going to be shipped to me, everything. That’s the whole point. If they just said, “It’s a cool drill. Call, and we’ll talk about it.”

Steven Butala:                   Yeah.

Jill DeWit:                            We wouldn’t do that.

Steven Butala:                   We’ll give you some more information if you’d like.

Jill DeWit:                            Exactly. No one would buy it.

Steven Butala:                   No, and the world would stop.

Jill DeWit:                            Yep.

Steven Butala:                   It’s just too much stuff to do.

Jill DeWit:                            Exactly.

Steven Butala:                   The whole point of this is to scale your business and jam as much property through the sales pipeline as possible with the least amount of work-

Jill DeWit:                            Mm-hmm (affirmative).

Steven Butala:                   And calling to talk about it. You know, I’m filming Land Academy 2.0, and I say this in the section about bottlenecks. The number one bottleneck for your land investment company, I don’t care if you’ve developed skyscrapers that’s talking on the phone, nothing will slow you down more … in this day and age, and I think it was different in the 50s or 60s because that’s how stuff got done, but there’s so much resources on the Internet, and you have other things to do besides talk on the phone.

Jill DeWit:                            Right. I want to add one point, too, that they mentioned about the price because it sounds like, the person that asked that question I’m sorry, I forgot your name.

Steven Butala:                   Steven.

Jill DeWit:                            Steven. Sorry.

Steven Butala:                   It’s not me, I didn’t … Sometimes I write these questions, but I didn’t write this one.

Jill DeWit:                            That’s hilarious. Steven, whatever. Steven, Bob, Fred.

Steven Butala:                   Any Steve will do.

Jill DeWit:                            Any Steve will do. Anyway, sorry Steven.

Steven Butala:                   That’s what Jill says.

Jill DeWit:                            Sorry Steven. I think one of the things that you mentioned was maybe not for the pricing, because I’m not sure if I want to cash or terms. What I would recommend is doing both. I would put in a terms price, which is always higher, and we know that and we expect that. When I buy a car, and I’m financing the car, or I’m buying a house, and I’m financing the house, I always know at the very end with the interest and everything, it’s more than I ever would have paid cash right now. So you’re not doing any wrong or sneaky, or anything. We expect that. So put right in there, “Hey, this property can be yours for $1,000.00 and $100.00 a month for three years,” whatever you want it to be. Or, “Cash, $3,500.00.” Whatever you want it to be.

Steven Butala:                   Yeah.

Jill DeWit:                            Put them both in there and then again, that saves you so much time and as me, as a buyer, I come along and find you, I’ve got all the information I want right there, and gosh, it makes you look better, too. I’m sorry if I’m … This is important.

Steven Butala:                   It really is.

Jill DeWit:                            This is a good question.

Steven Butala:                   It actually … This question comes up a lot. People skimp, people really … because it takes some time.

Jill DeWit:                            Yeah.

Steven Butala:                   And it takes some organization. Jill’s right. We get this question all the time. “Why isn’t my property selling?” And our immediate response is where do-

Jill DeWit:                            Look at it.

Steven Butala:                   Have it posted.

Jill DeWit:                            And what’s in it?

Steven Butala:                   “Well, I have it on Craigslist.” Do you have any pictures? “No-”

Jill DeWit:                            No.

Steven Butala:                   “I didn’t get to do that.” Well, that’s [inaudible 00:09:08]-

Jill DeWit:                            How’s the price? “Oh, I didn’t put a price. I’m going to see what they offer me.”

Steven Butala:                   It’s always-

Jill DeWit:                            Really?

Steven Butala:                   Always-

Jill DeWit:                            Okay.

Steven Butala:                   Some version of that, or it’s so grossly overpriced that everybody just kind of laughs when they look at it.

Jill DeWit:                            Right, because you bought it wrong. But-

Steven Butala:                   Posting property on the Internet is imperative to the success of this. We don’t talk about it that much because it’s just a mechanical $4.00 an hour overseas job once you do two or three of them and take a video of how you do it, and show them how to do it, and they do it.

Jill DeWit:                            My comment, the last comment I had was about transparency, though. I mean, that just says a lot about you. I mean, have your name, have your email-

Steven Butala:                   Yes.

Jill DeWit:                            Have your phone number-

Steven Butala:                   Yes.

Jill DeWit:                            Have all the good information and they’re going to read you and go, “This is legit.” Don’t put anything hokey up there when you’re just vague. It’ll work out, Steven.

Steven Butala:                   Have your complete sales somewhere. You need to show-

Jill DeWit:                            On your website.

Steven Butala:                   The properties that you have sold.

Jill DeWit:                            Or Land Pen.

Steven Butala:                   Nothing lends credibility like completed sales.

Jill DeWit:                            Yep. Thank you, I got that out now.

Steven Butala:                   Today’s topic, Property Data Quality Then and Now. This is the meat of the show. So what do I mean by that? As you can imagine, the quality of data that’s collected between 1970 and now is dramatically different in any industry, and real estate is no different. But here’s the thing, since the beginning of time, since the beginning of organized American time, America, counties have been keeping an assessor database of people who own property because that’s the only way they can send out in the mail tax bills. So over time, it used to be the property number, the APN, Assessor Parcel Number, and maybe the size of it like 22 acres and possibly a legal description, and then Sally and John Smith and their address.

Jill DeWit:                            Isn’t that amazing?

Steven Butala:                   Well, it’s dramatically evolved since then. The reason that’s evolved is because the assessors all over the country, there’s 3,144 counties. So for sake of argument, there’s that many assessors, and they all have a different way of doing things. So they have progressively created more columns in a spreadsheet to collect data on the properties within their jurisdiction to more accurately tax them. Five acres in the center of town, and five acres on way out on the outskirts of the county edge are completely assessed differently. Nobody can argue that. The one in the middle of town is worth way more money.

Jill DeWit:                            Is this like commercial and different zonings?

Steven Butala:                   Yes, and zoning and all that stuff.

Jill DeWit:                            Yeah, [inaudible 00:11:57]. Yeah.

Steven Butala:                   But here’s the good news. You know, this day and age, we have the most accurate data, the most sophisticated data set at our fingertips to price offers than we have ever had ever. Data then and data now, they can’t make it easier for us for real estate investors to send offers out accurately, priced accurately, smoke out the people who truly want to sell their property fast and efficiently and perfectly. If I sat down in front of Santa Claus and said, “Boy, next year I would like to have this data set, and I would like to have it set up,” I honestly couldn’t think of something better.

Jill DeWit:                            Really?

Steven Butala:                   Yep.

Jill DeWit:                            You think everything’s covered?

Steven Butala:                   From an Assessor database standpoint, yes. Then, when you couple it with yesterday’s show, which is RedFin data, RedFin and Realtor.com tell you where to send it. If you utilize the data correctly, they tell you where property is turning the fastest. You know, those two markets, that center town five acre property, that zip code’s churning faster just because there’s more people buying and selling property. In the outskirts, not so much. But when you really green, yellow and red it, which I think we’re going to talk about tomorrow, that coupled with the assessor data which allows you to send out a correct offer, you really, really dramatically remove most, not all, but most of the risk in this.

Jill DeWit:                            Two of the things that you described then and now, what we didn’t have years ago and we have now, which I think dramatically changed the game for us all are one, improvement percentage, because I need to know if there’s something on there.

Steven Butala:                   Yeah.

Jill DeWit:                            I don’t want to waste my time. And that’s something that wasn’t probably available then. And we have that now. And then also, why do they need to know that? Because they’re going to, of course, tax it differently. If it’s just an empty vacant lot versus now it has a hotel on it, we’re going to price it differently and tax you differently.

Steven Butala:                   Dramatically different.

Jill DeWit:                            Dramatically differently. So the proven percentage. The other thing that … I don’t know of this applies to assessors, but it sure does apply to us, which is the mortgage ratio and if it’s paid off or not. That is huge. We don’t want to deal with a bank-

Steven Butala:                   Yeah, most people probably don’t even know it’s available.

Jill DeWit:                            Yeah. You know, I’m trying to think of the best way they can go look. They can see … Well you know what? I know where they can look. If you really want to know what we’re talking about and see the 300 columns that we have, I’ll tell you a quick way to find it. Do you know?

Steven Butala:                   Yeah, I know it too well.

Jill DeWit:                            Yeah, so if you go to our website, because you can see-

Steven Butala:                   One of our websites.

Jill DeWit:                            One of our websites. It’s called Offers-

Steven Butala:                   Jill and I own a bulk mail company that allows our members and people that are not in our community, albeit different rates, to send offers out to owners. It’s called Offers2Owners.com.

Jill DeWit:                            Yeah, so it’s Offers, and then number two, and then owners dot com. So here’s what I want you to do, go there, go to the forms tab, and then you’ll see in there … you’ll actually see our mailers, if you want to see a sample land mailer, or a sample SFR, Single Family Residence mailer, so you’re trying to get someone and do the same thing that we’re doing with homes. They’re both of our templates are right there.

Steven Butala:                   Yeah.

Jill DeWit:                            So that’s pretty cool.

Steven Butala:                   It’s a great idea.

Jill DeWit:                            But the second thing where I really want you to see is go look at the data sources. There’s one in there, for example, I think it’s Torrance is in there … Torrance, California.

Steven Butala:                   Mm-hmm (affirmative). There’s a data set in there, and you-

Jill DeWit:                            And you can see.

Steven Butala:                   Could look at the top of the column. Download it and look at the top of the columns, and you can see it’s available.

Jill DeWit:                            Like, wow. Look at this all this data that they have at their fingertips. It’s pretty darn cool.

Steven Butala:                   You can see if there is any debt on the property, and if there is, what their mortgage amount is at the time that you’re downloading it. You can see if the land assess value versus the improvement assess value, and if the improvement value is zero that means it’s vacant land.

Jill DeWit:                            Right.

Steven Butala:                   It’s tremendous. It’s amazing.

Jill DeWit:                            Yeah. You can see-

Steven Butala:                   You can see what the former sale price.

Jill DeWit:                            Well you can even get-

Steven Butala:                   And when it was sold.

Jill DeWit:                            I mean, if you were doing houses-

Steven Butala:                   It allows you to send out a perfectly priced mailer.

Jill DeWit:                            Right. If you were doing houses, just for an example, and this is … Actually we’re not talking about land or houses right now, but you could put down three bedroom, two bath, no pool-

Steven Butala:                   Yeah.

Jill DeWit:                            I want this type of a roof. I want it built after 1975, because I don’t want to deal with the wiring before then.

Steven Butala:                   No mortgage.

Jill DeWit:                            I mean, I want no mortgage.

Steven Butala:                   Less than 1,800 square feet.

Jill DeWit:                            You could even put if it’s … I want to say there’s even a column in there, I have to go back and check this, but I think it’s even you could put whether it’s a north, south, east, west facing home. It’s like shocking what is in there.

Steven Butala:                   We’re not sure about that, but-

Jill DeWit:                            But talk about detail.

Steven Butala:                   It could be. There wouldn’t be a data …

Jill DeWit:                            I think I saw that.

Steven Butala:                   There probably is, actually.

Jill DeWit:                            I think it’s in there. Not every county, obviously.

Steven Butala:                   Then you can sort by … We’re licensed providers of this data. Real Quest, themselves, which is the data provider, they aggregate all 3,000 counties. By the way, all assessors have a different format that they use. One of the things that Real Quest does to make it really easy is put it all in the same format so whether you’re sending in out in El Cahon County, Nevada, or in Boston, let’s say, or anywhere that’s in the same format-

Jill DeWit:                            Right.

Steven Butala:                   So you don’t have re-learn this every single time you do it.

Jill DeWit:                            It’s huge.

Steven Butala:                   I mean there’s just too much to talk to-

Jill DeWit:                            Another thing about then and now-

Steven Butala:                   It’s beyond the scope of this. Yeah, yes. To get back to [inaudible 00:17:26] the point, there’s no comparison to then and now.

Jill DeWit:                            Isn’t that amazing?

Steven Butala:                   We’re obviously data freaks.

Jill DeWit:                            What’s going to change? You know what-

Steven Butala:                   It’s got to be boring to listen to us a lot.

Jill DeWit:                            I think that something’s coming, and it might be what you’re doing. I think that they only missing pieces … We have all the answers now, we pretty much have everything we could possibly want. I don’t need to know more about the people or their demographics. Maybe that’s going to be coming. Or-

Steven Butala:                   Let’s say … One of the things that we struggle with is property on a main thoroughfare.

Jill DeWit:                            Right.

Steven Butala:                   A lot of the properties that we get back in the mail positively to sign them and send them back, it’s on a major highway. Which we don’t like.

Jill DeWit:                            That would be so cool.

Steven Butala:                   Some people love that. That’s just not our thing. Some people love to take property like that and convert it to commercial.

Jill DeWit:                            Traffic count.

Steven Butala:                   So [crosstalk 00:18:11].

Jill DeWit:                            Traffic count would be a good-

Steven Butala:                   Here’s the thing, now it’s instead of taking the data and surmising that through six or seven other pieces of the data that are in the data set, you’re up to the discretion of the actual assessor.

Jill DeWit:                            Right.

Steven Butala:                   Somebody’s going in there and saying, “Is this property …” Yes. Check. Check. Check.

Jill DeWit:                            Based on what criteria?

Steven Butala:                   I don’t need to tell you that at times, government employees may or may not be the highest quality, most qualified person.

Jill DeWit:                            They don’t make mistakes. No, no, no.

Steven Butala:                   So you have to be careful with data that comes from somebody’s opinion-

Jill DeWit:                            Right.

Steven Butala:                   Versus … So, we can leave it at that. There’s probably a GPS way to surmise that with some algorithm. But anyway, my point is it doesn’t get any better than it is right now, and you learn, you will eat well for the rest of your life. Well, you’ve done it again. You’ve spent another 20 minutes or so listening to The Land Academy Show. Join us next time where we cover Zip Code: Red, Yellow and Green Tests for In-Fill lots.

Jill DeWit:                            And answer your questions posted on our online community, LandInvestors.com. It’s free.

Steven Butala:                   You are not alone in your real estate ambition.

Jill DeWit:                            It’s perfect to lead into tomorrow on the show. Perfect, perfect, perfect. I’m excited to talk about tomorrow’s show.

Steven Butala:                   Let’s do it.

Jill DeWit:                            Share the fun by subscribing on iTunes and YouTube. And while you’re at it, please rate us there.

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Steven Butala:                   Information.

Jill DeWit:                            And Inspiration.

Steven Butala:                   To buy undervalued property.

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