Top 3 Deal Killers (LA 830)
Top 3 Deal Killers (LA 830)
Transcript:
Steven Butala: Steve and Jill here.
Jill DeWit: Hello.
Steven Butala: Welcome to the Land Academy show, entertaining land investment talk.
Steven Butala: I’m Steven Jack Bu tala.
Jill DeWit: And I’m Jill De Wit, broadcasting from sunny, southern California.
Steven Butala: Today Jill and I talk about the top three deal killers. And true to form, I bet you that hers are real different than mine.
Jill DeWit: You think so? Oh, I think there’s two that we’re gonna be the same on. That’s my guess.
Steven Butala: Excellent.
Jill DeWit: This will be fun.
Steven Butala: What if we just eventually become the same person?
Jill DeWit: Oh that’s yucky.
Steven Butala: Where we just agree on everything.
Jill DeWit: Could you imagine?
Steven Butala: That would be awful.
Jill DeWit: That would be aw… that’s icky (laughs).
Steven Butala: You know how they say like, people who are together-
Jill DeWit: Start dressing alike
Steven Butala: And they look alike and everything.
Jill DeWit: Oh, I thought it was like your dogs. I always think, you ever notice, seriously … like imagine this. You see a guy walking down a street with a dog and the guy has long hair and the dog has long hair, or the guy has a beard and the dog kind of has a beard. It’s the spookiest thing.
Steven Butala: Yikes.
Jill DeWit: I hope we don’t start doing that, oh no.
Steven Butala: Let’s stop that right there.
Jill DeWit: I won’t let that happen, no, no, no, no, no (laughs).
Steven Butala: Before we (laughs) get into it, let’s take a question posted by one of our members on Landinvestors.com online community, it’s free. And as you’re listening to us, post or drop your questions into the comment section below there on YouTube.
Jill DeWit: I like to think our kids won’t let that happen, by the way (laughs).
Steven Butala: (laughs) I know. You know the older you get, you’re like eh.
Jill DeWit: Shucks.
Steven Butala: We’ll just shove it all on the kids when they’re adults. (laughs).
Jill DeWit: Exactly (laughs).
Jill DeWit: Okay. Curtis asked, “Hello all, I live in California. Oops, not California, Canada. I’m saying California. But I want to appear to be anywhere but there.” Oh gosh.
Steven Butala: I hear you, man. I understand.
Jill DeWit: I know in the [inaudible 00:01:47] world, many people do not like Californians buying up the real estate in their state. I think I may have lost a deal in Atlanta yesterday because of this. Call me paranoid, but I travel a lot and every state I go to seems to complain about Californians ruining the affordability of their state. Are there any problems from the LLC, virtual address, and phone number in another state as long as you pay the fee to California because they will hunt you down? I have no plans to move to Arizona, but I want to appear that I’m from there and my company is there. I don’t know anyone who hates Arizonians, thanks.”
Steven Butala: Those are all good topics, you know, this comes up a lot lately. I wouldn’t overthink it. I don’t think that people hate California as much as you think in the SFR, I don’t think so.
Steven Butala: So this came up in a live event and here was my comment on the internet it’s the same. Let’s say you lose one deal a month because of this theoretical, I don’t appear to be in the same state. Georgia.
Jill DeWit: I don’t like snotty Californians rule or something.
Steven Butala: And you lose 10,000 bucks a month, let’s say. I mean, is it worth for you to maintain or put up an appearance like you’re from Georgia? I think he referred to. That’s the question you have to ask yourself. The real question is are you losing a deal because of this? Is somebody crumpling up the letter, throwing it in their shredder and throwing it away because you’re from California? So, you’re asking to purchase their house for a couple hundred-thousand bucks. It’s worth 250,270. Are they saying, “You know what? This guy’s from California. I don’t want his money.”
Steven Butala: I personally don’t think so. I also think there’s way too much crap involved in all of our companies and little tasks in managing phone numbers and getting that mail box in Atlanta and all that stuff. So, it all becomes, like the show yesterday, it all just becomes about Math. So what, they crumple your letter up. Now you’re sending out, I mean, for every SFR, our numbers are pretty low now.
Jill DeWit: Can we talk land? Can we do that?
Steven Butala: Yeah, sure. He brought up an SFR.
Jill DeWit: Did he?
Steven Butala: Yeah, so for every info lot that we buy, we send out about a thousand letters and we buy one.
Jill DeWit: Or more.
Steven Butala: If it ends up being 15 hundred because of this theoretical problem. This is a geography issue. I don’t care. It’s 250 dollars more in postage for me per month and I don’t have to maintain a phone number in every state that we go in so, no, we don’t do it. But that’s choice. We have members who swear by it. So you’re going to have to really kind of figure that out for yourself. And then I finally have this to say. California is maybe the worst place to do business in the planet but most of the companies are here so-
Jill DeWit: (laughs) What was that?
Steven Butala: Does any of that make sense? Texas is maybe the best place to do business in the country. But most people don’t.
Jill DeWit: May I please translate? (laughs) What Steven is trying to say is, none of these ideas are crazy. If you really feel strongly about it, go for it. Just don’t forget that you’re creating extra work for yourself.
Steven Butala: Yeah, pretty soon you got 30 phone numbers to manage and you wondering why you’re not doing any deals.
Jill DeWit: I don’t think that’s what he was saying. I do think he was saying, “I would just set up one in another state and run everything out of that other state.” That’s what I think he’s saying. Some state other than California, like maybe Arizona where we still have an office and still have an address and still have all our things routed through because we started there and we can’t change it now like we tell you.
Jill DeWit: You know, Curtis, you live in California now and you live in Florida in 2 years. So, you can’t keep changing these around because people will never find you with all your offers and your letters that you have out there so just whatever you pick, stick with it. I wanted to say, I think you’re overthinking it? And, it’s okay.
Steven Butala: Is there a difference between-
Jill DeWit: You can make a joke about it, too. If you think you really lost a deal, you be like, “No.” Even if you’re one of those Yuppie Californians that live on the beach, you can say, “Oh, gosh, those guys drive me crazy too.”
Steven Butala: Yuppie?
Jill DeWit: They don’t know that that’s really you sitting there. You know, don’t make it obvious on your space bar. You don’t have to draw them to that but, you know what I mean?
Steven Butala: She means Hippy.
Jill DeWit: Well, Hippy, Yuppie, Snotty, whatever you want to call it.
Steven Butala: (laughs)
Jill DeWit: Can I finish, please?
Steven Butala: Yeah.
Jill DeWit: So, they don’t know that that’s you.
Steven Butala: Hippy, Yuppie, Snotty.
Jill DeWit: You can make a joke about it. Like, I would make a joke about the people that drive those cars, never mind you, I have one of those cars. You could do that. So, I’m just saying.
Steven Butala: So I think that between Arizona and California, anybody cares? No. I don’t think so at all. Now I understand the question.
Jill DeWit: No, and you know, you don’t want to sound phony too. Let me follow this up. What if you say, “I think everybody loves Texans. Everybody thinks it’s great, talk about, you know, good people so I’m going to get a Dallas but you don’t have a Dallas accent. You don’t act Texan. You don’t say, “Ya’all” and “bless her heart” and you don’t want to sound phony. So, you you have to be careful there too.
Steven Butala: (laughs) Today’s topic, top 3 deal killers. This is the meat of the show.
Jill DeWit: Can I go first?
Steven Butala: Yeah.
Jill DeWit: Alright. Here are my top 3 deal killers. I’m going to list then all and then we’ll talk about them. Number 1, time. Number 2, undisclosed items. And number 3, people.
Steven Butala: (laughs) Just people?
Jill DeWit: Just people.
Steven Butala: Yeah, people tend to kill deals.
Jill DeWit: Well, let me back up. So let me explain more. So number one, I have a reason for this, number one, time. We know time kills deals. That’s a fact. That’s happened to us-
Steven Butala: She means, the longer the deal goes on, and the more chances are failing.
Jill DeWit: It’s like, hey, it’s happened to us or had people not get excited and complete a deal and it’s happened by us with enough time on it and it’s like, you know, I don’t want it after all. Now it’s taken too much time to close this deal. I was only going to make how much? Okay, then now it’s no longer worth my time. We’re out of here. I just move my money somewhere else. So, that’s time.
Jill DeWit: Undisclosed items. I hate that. That drives me batty. It’s like changing the rules at the last minute and I can’t stand it. That will kill a deal. If you find out that there’s something with the property. There’s some taxes or some fees. There’s some HOA rules, POA rules, something you weren’t expecting that’s thrown in there at the last minute that now cause why cause that usually messes with the bottom line on the deal. That will kill a deal. That makes me angry. And number 3, people, and when I mean when I say people, it’s often people and agents who, they’re not believing the situation. They think, “This is too good to be true,” and they will actually accidentally kill their own deal. So that’s where my people comes from. So what are yours?
Steven Butala: The number 1 thing that for me, besides people, that is a deal killer is communication. So the conventional wisdom out there for a lot of things is true but I don’t think for real, they’ll say, “the more communication, the better.” You know, the whole assumption saying that we won’t even bring up, or opinions or assumptions. There’s all kinds of clichés and silly little sayings about that. You can set your business up and, I’m really serious about this, this is the actual meat of the show for me.
Steven Butala: Set your business up so you’re having basically one, possibly, two conversations with the seller, maybe three. I have a three conversation rule. After three, that it’s just emotion after that. And with a buyer, you shouldn’t even talk to them one time. They should be just checking out online for land with a credit card. And consolidate informations on there. With infolots slightly more complicated. Not really, though. And, with that so far’s, little more leniency but those two product types, you make so much more money. So, it’s actually worth it.
Jill DeWit: So is your number 1 communication?
Steven Butala: Too much communication.
Jill DeWit: Means, too much kills a deal. Got it.
Steven Butala: Yeah.
Jill DeWit: Okay, what’s your number 2?
Steven Butala: Is people. It’s people and their personalities, it’s communication so you don’t communicate with the buyer and the seller that much, you’ll never get to know them! They don’t have a chance to kill it.
Steven Butala: You notice one thing that is not on either one of our lists? The quality of the real estate, the actual real estate, itself, and money.
Jill DeWit: Yeah, we’re past that.
Steven Butala: Money doesn’t kill any deal for us.
Jill DeWit: No, because you know that going into it.
Steven Butala: But if you ask somebody who is brand new, they’re going to say, “Well, the deal, the foundation.” Everybody’s foundation crazy! And for lots SFRs.
Jill DeWit: Buildability!
Steven Butala: So SFRs.
Jill DeWit: Marketable title!
Steven Butala: I swear that I don’t know what happened in their life that, maybe their parents had to dig up their floor one day. I don’t know. These constant foundation problems in their head and it’s all fiction! If you buy a property cheap enough or if it’s a info lot and your lucky enough to have a foundation on there, that’s the greatest info lot deal you can ever get is one with a foundation where the house burned down or something, forget about it. And money? If you get a deal that you’re buying a property for 50 cents on a dollar or 80 cents on the dollar, there’s no money problem! You’re one posting away on landinvestors.com to get all the money you want!
Jill DeWit: You bought it, right? So you can afford the repairs or anything like that. What’s your number 3? So, communication, people-
Steven Butala: Time. So much time passes and it’s not just the seller changes their mind or the buyer changes their mind. Sometimes we change our minds. The top reason I have killed, personally, when I’m involved, personally killed deals that perfectly viable economically, is because I can’t stand talking to the person on the other end of the phone any longer. I have killed, probably, 20 deals in my career where we would have made tons of money on them and it’s, you know what? I can’t stand talking to this person any more! It’s killing me! It’s not worth it. I’m losing sleep over it cause the guy is such an idiot! So, people. (laughs)
Jill DeWit: Okay, time, wait. So people communication, people, time.
Steven Butala: Yep.
Jill DeWit: And mine’s time, undisclosed items and people. So we’re pretty close! See? I guess 2 out of 3, we got 2 out of 3.
Steven Butala: And when I started in all this, it was the real estate, itself, I thought, the real estate, itself, didn’t pass due diligence, it never happens. And we just can’t get enough money together, work on the debt or the equity piece. Never happens. This is worth listening to this show! This advice.
Jill DeWit: Oh, it is!
Steven Butala: I’m serious! If I was brand new at this, or even like, within a hundred of my first deals, it’s really funny what you think when I start anything new, I’m like, have all these concerns and after I get into it, all my initial concerns are all different and it ends up being what’s the bottleneck or the problem causing stuff. It’s tiny little tasks or IT.
Jill DeWit: Isn’t it funny. I was just saying that we just said these live events and the questions at the beginner event and the questions in the intermediate event are all different. The beginner event, they’re still having a little deed hangups. And they’re a little worried about something that hasn’t happened yet. I’m like, don’t even think about it. If it does come up, we’ll worry about it then. But they’re so nervous and hesitant and I know that once they get over that hump and then they’re in the next group and the next section and they’re doing bigger deals and they’re like, “Uh, that’s not important anymore!” Like you’re just saying. What you worried about at the beginning. What you’re worried about now, two different things. It’s awesome.
Steven Butala: Or they’re worried about so much in the beginning, that they can’t get past it and they never get mail out. That’s a real tragedy.
Jill DeWit: That’s the sad part.
Steven Butala: They never get any mail out! Because they’re hung up on some stuff that’s just totally in their head.
Jill DeWit: Still picking a county and who’s going to answer the phone and I don’t have my phone number yet, which you can do in an hour or less.
Steven Butala: Yeah, I would argue that if you already own a business, all the stuff that you have to do to get everything started, and I mean, really doing it the right way with analyses and everything, you can do it in half of a day. Probably less. Probably, if you practice it a couple times, maybe an hour.
Jill DeWit: You’re right, it’s not that hard.
Steven Butala: Well, you done it again, and you spend another fifteen minutes listening to the Land Academy Show. Am I pronouncing that right?
Jill DeWit: You did awesome! (laughs)
Steven Butala: Sometimes we get all done and she’s like-
Jill DeWit: It’s coming! You haven’t hit that word yet! Go ahead!
Steven Butala: Join us next time where we discussed.
Jill DeWit: See? That’s the word!
Steven Butala: Discuss crossing the end of the line. (laughs)
Jill DeWit: And answer your questions posted on our online community landinvestors.com. It’s free.
Steven Butala: You’re not alone in your real estate ambition.
Jill DeWit: That’s so funny.
Steven Butala: It’s really funny we can laugh about the effort with each other because some people who been together for a long time, it’s not that funny anymore.
Jill DeWit: No.
Steven Butala: You know, like, the amount of hair that’s are growing out of your ears, Steve, it’s not that funny anymore. (laughs)
Jill DeWit: What type added a d is really cute! (laughs)
Steven Butala: That’s disgusting, man!
Jill DeWit: I know!
Steven Butala: Even for me!
Jill DeWit: I know! (laughs) That’s cracked up! (laughs) I shouldn’t worry about that!
Steven Butala: I love disgusting stuff!
Jill DeWit: Ugh! It’s awful! Ugh! Share the fun by hitting the subscribe button on YouTube to stay up to date on our podcast or if you’re new to our channel. Like us and comment on what you would like to see on future shows and if you’re listening on itunes, please write us there.
Both: We’re Steve and Jill.
Steven Butala: Information!
Jill DeWit: Inspiration
Steven Butala: To buy undervalued property.
Jill DeWit: That was gross.
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