The Power of Scaling Offers to Owners (LA 932)

The Power of Scaling Offers to Owners (LA 932)

Transcript:

Steve and Jill here.

Hello.

Welcome. Jill, you crack me up with this stuff.

I’ll just kind of slow it down.

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

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

Today, Jill and I talk about the power of scaling offers to owners. Is that slow enough?

I have to admit something right now for everyone, and you too, Steven, that I didn’t take any notes. I rewrote the top title, and I’m sitting here going, “How do we want to talk about this?” So …

I’ll do it.

Okay, good. I am sure you have a plan.

Yeah, I have a total plan.

Okay, good.

It’s gonna be concise, and mind-boggling. And informative, and entertaining.

That’s what every woman wants.

Concise?

I want a man who’s concise and mind-boggling.

I don’t think everyone wants that.

No, they don’t.

What do they want? What do women-

But a man wants a woman who’s concise and mind-boggling.

So, what do women want?

Isn’t that true? You want a woman that’s concise and mind-boggling. Like, “I don’t know how she looks like that, or how she packages it up, but it looks good. That’s mind-boggling.”

Packages it up?

Exactly.

Nice packaging.

“Whatever’s going on under there, Daddy likes.”

What if you walked up to a woman and said, “Hey, nice packaging”? How would that go?

You know what? It depends on the person, but I got a few people who would think that’s comical. And I got a few people that would not think that’s funny.

My experience with women has been, they’re not gonna like that at all.

No, I am that person. That if you walk up and go, “Hey, nice packaging,” I’m gonna be like, “Right? Thank you.”

“Yeah, it’s all Nordstrom Rack, half off.”

“I got this all just right where I want it.”

It is ridiculous.

“And there’s no body tape involved.”

Ridiculous how differently men and women are, that we even talk to each other for any amount of time at all.

Dude, I’m gonna walk up to you some day, and I’m gonna be like … You’re with some really cool jeans, and I’m gonna tell you, “Nice packaging.” What would you say?

If you said it to me?

Yeah.

I would say, “Hell, yeah.”

Okay, good. See?

I would say, “How do I kick it up even a couple more notches?”

I like this. This is my new thing now. “Nice packaging.”

I don’t even know what this show’s about.

I do. I can help you.

Oh, before we get into it, let’s take a question posted by one of our packagers on LandInvestors.com. It’s an online community, and it’s free.

Okay. This is a little bit different. This is actually a thread that was started by a member on our staff, and I wanted to read about what we’re doing here. This is kind of just to further let you know about the value of this group and what we’re doing.

Yeah. That’s really what this is for.

A, what we’re doing for the group, and B, how smart our group is, based on the comment and the feedback that we got. So here’s the thread, started by Erin, one of our senior managers here at Land Academy. She wrote, “Hello, all. One thing that we’re working on here at Land Academy is creating a centralized place where members can put recommendations for various types of vendors, et cetera, that they have used before in different areas. Our question to you is, how”-

Vendors meaning, “Hey, is this title company in North Carolina good or bad?”

Actually, put the vendors in that they’ve used and loved.

Yeah.

Not to talk about them, but like-

Oh, just a good-

… “Hey, anyone in Florida, this is the guy. He’s the bomb. We did all these deals in 10 days.”

Okay.

And, “Hey, Texas. I’ve got a great drone pilot. He will drive to all the surrounding states. Here’s his contact information and how much he charges.”

Okay.

It’s that kind of a vendor list.

I’m the last one to know, because-

That’s okay.

… I’m the owner.

That’s okay. That’s why I’m here. So, that’s what we’re putting out there for … Because our members have asked for this, right? This is the point. So, we’re starting to put together an area for everyone to contribute. So Erin says, “Our question is to you, how do you think we should set this up so we could all contribute? A new forum area organized by location, or type of vendor? We’re open to ideas. Thanks.” That’s my team saying, “I need some feedback from you all. How do you want this”-

Because people are requesting it.

Right. It was one of our requests from our surveys, a top request. Because let’s be honest. Myself included, I create my own vendor list. I have my own list of notaries that I love in certain areas. I have my own list of title companies that I love in certain areas. I have my own list of counties, and how the counties work together well. And drones, and photographers, and everything like that. So one of our members, Joe Schmidt … Which is awesome. He wrote this beautiful thread to help us out and get our acts together.

To get us organized.

Thank you, Joe. So, here’s what Joe wrote: “My day job is that of a process consultant, and part of my area of expertise is knowledge management. For what it’s worth, if it’s going to be part of the forum, there needs to be a central coordinator who curates the content and reviews it regularly for relevancy. That is, people need to submit the content, it needs to have an initial review, and then it needs to be re-reviewed at a certain trigger point. I would point you to the marketplace on Bigger Pockets as an example of how to do it right. A Google sheet will meet with a flurry of new ads … ” So, that’s one of the ways to not do it.

Yeah.

“After the initial enthusiasm dies down, with nobody to promote it, the sheet will start to lose relevance. After a while, people will see that there are no new updates. Some of the information will become inaccurate, and people will notice this. Then it becomes an untrusted form of information, and almost completely unused. We have resource areas in the forums today that are largely unused for this reason. Suggestions: One, one person is responsible for vendor recommendations, an employee or volunteer who gets a good spiff for doing it.” Love it.

“Two, create a submissions process that ties a submission to an owner. Three, display the page prominently, like at the top of the page, so that the top of the mind are people who use it regularly.” I guess. “And then four, promote the use of the page through regular communications, or perhaps badges, awards, et cetera. Five, set triggers to recheck the validity of the content. Either follow up with the submitter or the resource themselves. You can’t let the information get stale.” Thank you so much, Joe.

This couldn’t be more well thought out, or presented better.

Schmidt. That was awesome. Thank you for-

That’s the kind of people that are in the Land Academy group. Joe, thank you.

And how smart our group is.

And we will develop some version of that.

Yeah.

It may not warrant that much effort or organization, but we will put something together. And I understand, completely understand-

You’re right.

… from your experience about how things get stale after a while.

Exactly.

And then just get unused, because other things go to the top.

And then it’s just a confusing mess, and then you just give up.

Right.

That’s awesome.

I’m not sure … The flaw. Here’s the flaw with this whole … And it’s not with Joe’s comment, or Erin’s wanting to do this. But, there’s a lot … Like, let’s look at Land Tank. Land Tank is a mutually beneficial relationship. Somebody in there finds a great deal, and somebody who is in our group that has a ton of money wants to invest in it as a partner. Everybody wins.

Right.

I’m not sure why I, as a member in North Carolina, for example, who uses a specific closing attorney, can benefit in any way from posting it, other than just a good Samaritan situation.

Well, wait a minute. Because you’re gonna get something out of it when you have an Oregon deal, and you need that resource for Oregon. So, that’s the benefit.

Okay.

That’s the whole benefit of Land Investors. That’s why we’re doing this online community, too. Posting information, helping other people because someone helped you, and you helped them. You get some information over here. Hear about experiences that you haven’t dealt with even, yet.

Yeah.

So, I’m personally right now doing it for my own deal funding. We actually have our own little thread, so I’m ready when we have it ready, when this is going to pop in my own list of vendors, and mostly title companies and title agents, and a couple notaries.

Here’s how I think we should do it. I totally agree with Joe about the submission format. There should be, like you put in a ticket for a tech problem?

That’s what he’s talking about.

A submission format that way.

Right.

But I think that it is gonna go stale. I wonder if we can send out an automatic email to all active members, like on a Wednesday at 1:00 or something like that, that says, “Hey, it’s that time again. Let us know who a great vendor that you’re working for is. Please click here and submit it. It only takes 30 seconds.”

I will consider that. Thank you.

Some version. I don’t know.

Yeah. Cool.

Really, the whole point to this is not that we’re doing it. We are gonna do it. The point is-

To make our lives easier.

… our members are amazing.

That’s the thing.

That’s why I actually included this in the script, because-

Well, and we all want to work together. We all are gonna save each other, you know? And what we currently do today … Like even for you, listener. If you’re thinking about the land business, and you’re testing this, and you just found six deals in New Mexico or, I don’t know, Oregon, that you want to buy … Whatever it is, and you need to close these deals in Oregon, and you want to know … You could go right now on our website and start a thread that says, “Hey, guys. I need help. Does anybody have a good Oregon person?” And that’s what’s happening today.

On the deal board, yeah.

Our people will reply and help you. And so, what I want to do now is just centralize it, make it a little more organized. I think we should make it to the public, too. There’s no reason not to.

Right.

Because you know what? There’s no reason why we shouldn’t celebrate and share, and help quality people prosper.

Sounds like Star Trek.

All right, get to the beginning of the show. All right.

Today’s topic? The power of scaling offers to owners. This is the meat of the show. And in good form, Jill says she has taken no notes, and is uninterested in contributing to this show today, so …

What? You say that like I do that every day. That is the opposite of what I do. Shush. I just was kind of … I don’t know. This morning, I was just kind of not really with it. I wrote down the topic, and then we started talking, and that was it.

May I?

Yes, please.

There’s a lot of ways to locate cheap property. Here’s a few that I have done in the past, which have all led me back to sending blind offers to owners. You can call around a bunch of real estate agents and say, “Hey, you got anything? You got any good, cheap property that’s not really on the MLS yet?” And on a great day, you can make 20 to 30 phone calls.

Could you imagine?

So, you’re reaching 20 to 30 people.

Ugh. Makes me sick.

Let’s say each of those people, by some miraculous concept, come up with two deals for you. I’m gonna give you all the benefit. You made 30 phone calls, and got 60 deals to review. Which would never happen, but let’s say the planets are aligned. So, that’s one way. Number two, you can look through tax sale lists, whether they’re tax liens or tax deeds. And on a greatest day, you can call one county, and they’re gonna send you a list of 5,000 potential tax liens to buy. And let’s say you-

This is a perfect scenario.

… by some miraculous time management scenario, you review these deals, and then find out that 20 of them work for you. You’d have to file judicial foreclosure, and go through a bunch of stuff. And six months later, you bought a couple properties, and maybe you made some money. I’ve done all this.

This is a funny exercise. I really like this.

I’ve done all this stuff. Maybe you like tax deeds better.

Don’t let this happen to you.

Tax deeds. So you get in your car, and you drive around the country and go to these auctions. And a gavel auction, a live auction … Believe it or not, they still do it in a lot of states.

Yup. They’re fun.

And everything works out great, and you buy 30 or 40 properties and double your money. Awesome. How long did that take? Well, I was on the road for four months. I think I still have a wife. You can call a corporation and see what they have for sale, and maybe you’ll get lucky and buy a couple of properties for 80 or 90% of what they’re worth, street value, at that moment. Or, you could get in your car and drive for dollars.

Yeah, yeah. That’s my favorite.

You can drive around and look for houses that are falling down. It doesn’t work for land, by the way. Or you can knock on their doors, better yet, and say, “Hey, you want to sell your house?”

Right.

“I got cash.” I’ve done all these things.

That’s awesome.

And they are all stupid, compared to the right way, which is this.

So stupid.

Sit down. Learn data. Learn RealQuest Pro or Data Tree or whatever you want. Understand assessor’s data. Do some market research in front of a computer about what markets actually make sense. I’m not gonna go into the details about how to do this, because it’s all in our education program. It’s all on Land Investors and stuff. And eight to 10 hours later, it’s very, very possible and likely … We do it all the time, and our members do it all the time … that you have gotten 10,000 blind offers, logical blind offers, to asset owners in the mail. Done, in the mail. So, if anybody out there has a better eight-hour way to send offers?

Then you kick your feet up. You wait a week or so. And of the 10,000 people, 50 to 100, maybe 150, are gonna call you back, or some version of write letters back, whatever. The vast majority of which are gonna be a little bit angry with you, because you sent lower offers than they believe their asset’s worth. That’s fine. But five or 10 people are gonna say, “Yeah.” So, I don’t know what other way to get five or 10 people, two weeks from now, to say, “Yup, I do want to sell my assets to you for that price, or maybe a slightly different price,” within the timeframe that you suggested, and thanks very much.”

Mm-hmm (affirmative).

It’s the most efficient thing. And I have to say, I’m patting myself on the back here. I did all this stuff wrong, for years and years and years. And I just, I always knew that there had to be a better way. So around 2004, I really started sending a lot of offers to owners. This is long before we had Land Academy or a data subscription, or offers to owners of the company.

Right.

The bulk mail company. So, maybe it is better that I actually described all this, and you didn’t. I mean, what do you think about that? I don’t know any other way to do it.

No, this is perfect.

In fact, it’s replaced everything. We don’t buy auction property anymore, ever.

Yeah. Those things were fun. It was like a hobby. But it’s not really worthwhile. It’s not worth our time. That’s where we are now. There’s so many decisions. We were making one just the other day, about some of the things that we’re gonna invest our time in this year, in 2019. It really comes down to, “What’s the best use of my time?”

Yeah.

There’s just no replacement.

So, what ends up happening with some of our top-tier, top-performing members is they understand that, “Well, if I send out 10,000 in an eight-hour … What if I spend two days, and send out 20,000? Can I achieve the same yield?” Here’s the yield, by the way, if you do it right. For rural vacant land, for every 300 or so offers you send out, you buy a piece of property. For infill lots, I-N-F-I-L-L lots, where there’s two houses between a vacant piece of property, it’s about 1,500. And for wholesale houses, I’m just gonna say it’s around 3,000, but it’s not. It’s closer to 2,000.

Right.

But it’s harder to price, and there’s some more tricks to it, which is why we’re developing House Academy right now.

Right.

Then you got commercial property, mobile property, and all of that stuff. We’ll be developing these things in the future, but our more astute members have figured out how to do this for themselves, just based on this offers to owners concept.

Right. For the other property types.

All kidding aside, you can print money if you do this right.

Well, the other thing I was gonna say, at least based on all these examples, too … This is why so many people come to us, and are involved in this while they have a job. You can’t always take time off to be running around to auctions, and [inaudible 00:16:24] for dollars, and making all these calls. Think about all the time. And with ours, too, I can do it on a Sunday at midnight if I need to. You know, whatever my schedule is.

Yeah. Or from a different country.

Yeah, right. That’s true, for a different country. We have a lot of international people doing this. It’s very good. A lot of people overseas in the military that are doing this. They’re a huge group of you all that are doing it that way, and it’s awesome. So, where else can you do this that way?

I don’t know.

It’s awesome.

It’s a great way to generate equity to buy more property.

Yeah.

But then, let’s just take it a step further. Let’s just say you already have a bunch of dough, and you’re kind of retired. This is like a lot of people in our group.

Yeah.

And I’m older, and I don’t like data, but I love doing real estate deals, because I’ve been doing it my whole life. Maybe I’ll just invest in these young guys in the Land Academy group. Give them all the money they need, and they do all the mail and do the deals. And so, we’re doing a lot of that through our deal funding.

Ding, ding. Mm-hmm (affirmative).

So, it keeps getting better and better.

It does. It’s true.

I love this offers to owners concept. I’ve been in love with it for 15 years now, almost 15. Well, it is 15 actually, this year.

And we’re gonna end it on this: That’s longer than me.

Well, you’ve done it again. You’ve spent another 15 minutes or so listening to the Land Academy Show. Join us next time for Finance Friday with Steve and Jill and Justin.

And we answer your questions posted in our online community, LandInvestors.com. It’s free.

You are not alone in your real estate ambition. Cut me off again, which I think is great.

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