Data is Your Crystal Ball (1024)
Data is Your Crystal Ball (1024)
Transcript:
Steven Butala1: Steve and Jill here.
Jill DeWit: Good day.
Steven Butala1: Welcome to the Land Academy Show, entertaining land investment talk. I’m Steven Jack Butala.
Jill DeWit: And I’m Jill Dewitt, broadcasting from the sunny, Southern California.
Steven Butala1: Today, Jill and I talk about how data is your crystal ball.
Jill DeWit: It is. You know what I wrote? I wrote down, “Don’t guess. Use data.”
Steven Butala1: Exactly.
Jill DeWit: That’s my big … I have more to share though.
Steven Butala1: Me too. There’s data for acquisitions. We use data for making acquisition decisions. We use data for deciding where to send offers to owners, and we use a tremendous amount of data in the sales part of it, so I can’t imagine doing this without data, and I think during the 80s and 90s or up to the 80s and 90s, it was kind of just a dart board.
Jill DeWit: I have to say. Jack used data for everything, and I have to ask. Did you use data to find me?
Steven Butala1: Maybe. I don’t know. We’ll talk about that in a minute. Actually, I think I might have.
Jill DeWit: I’d like to know how you use data for relationships. I’d like to know how you use … Because Lord knows you’d use it for every other major decision, which is actually good. You use data for cars. You use data for houses. You use data for almost having a child. For children.
Steven Butala1: Well, I’ll tell you what. If I analyzed all the data about whether or not to have children, the outcome would have been different.
Jill DeWit: Yeah, you failed. I won’t say you failed on that one, but maybe a little more research would have been appropriate.
Steven Butala1: Before we get into it, let’s take a question posted by one of our members on landinvestors.com online community. It’s free.
Jill DeWit: Michael asked, “Hello, community. I am as green as they get and looking for some advice. I’ve been researching land investing for a while, and I’m convinced it would be a great opportunity for me and my family. I have not pulled the trigger on starting yet, though, and I need some help getting over paralysis by analysis.” Data comes in there.
Jill DeWit: “My situation is this. Our family will be moving to a different state in two years. How much of a hassle is it to start a company like NLLC in one state, acquire the assets, and then move to another state? I’ve read about domesticating your LLC in a new state, but I was wondering how much of a hassle that was. That said, I get it, that I don’t need an LLC to start, and maybe this is my reptile brain holding me back from what’s possible. I really don’t want to wait two years before starting this journey. Talk some sense into me, please. Many thanks, Michael.”
Jill DeWit: That’s a good one.
Steven Butala1: It is. There’s two, a direct question about LLC’s here, and then there’s a serious underlying question here.
Jill DeWit: Uh-oh.
Steven Butala1: Number one, let’s be super clear on this LLC thing, and it comes up a lot, and it’s a very good question, and you’re very, very new, and thank you for letting us know. You can have an LLC and operate in another state all day long. Large corporations for tax reasons and a lot of legal reasons had Delaware LLC’s or Nevada LLC’s. For those two states, specifically, you don’t have to disclose personal members. A company can own a company, and there’s a lot of advantages. So, get that out of your mind. It’s not like a driver’s license where if you live in California, you have to have one after a certain amount of days of moving here, or so they say. So, let’s forget about that. What’s really going on here is that you’re afraid to do a mailer. That’s what’s going to happen.
Jill DeWit: You think so?
Steven Butala1: Yeah.
Jill DeWit: Oh, I don’t know.
Steven Butala1: You’re afraid of failing.
Jill DeWit: I don’t know. I don’t think so.
Steven Butala1: So you’re worried about the LLC and your phone numbers, and it’s like you said early on in our Land Academy career together. You got to have all your pencils straight on your desk, and you have to have your cards printed out, business cards and all that.
Jill DeWit: I did say that.
Steven Butala1: You don’t have to do any of that stuff.
Jill DeWit: I forgot.
Steven Butala1: If you just keep-
Jill DeWit: If he didn’t move it … Here’s what I would do personally. If I know where I’m going to be in two years … Say I’m in the military or something, and I know what my next assignment’s going to be or my job, whatever it is, and I know I’m going to be there for 10 years, I would actually get started there and do it from where you are and make it easy. You’re going to have your mail forwarded for a while, but big deal. I just talked to somebody about this this morning who is starting up in Washington, the State of Washington. I’m like, “Make sure that you pick a mailbox place that can forward your mail because you’re going to always have that mailbox place and always have that phone number. So if you want to forecast and put it there to make your life easier, I understand. But otherwise, don’t worry about.
Steven Butala1: All this stuff that it takes starting an LLC, getting a phone number … And we have talked about this in great detail in the program. When I do it now, it takes me a day. If I right now started a brand new company with a new LLC and a new phone number … And Jill and I do this all the time because we’re buying separate assets from some other state. It takes less than a day. For somebody who is brand new, it shouldn’t take more than a week. In fact, it shouldn’t take more than three days for somebody … Because I can obviously tell, Michael, how you’re writing this and your concern and how bright you are, and you’re thinking about your family and your moving. I’m sure you have great reasons for that. So, it might take you two days. So don’t let that stuff stop you.
Jill DeWit: Well, that’s the main point.
Steven Butala1: Let me tell you a very short story. There is a guy in our office. His name’s Joey. He came to me. Jill and I over the years, first me and then Jill after that, and then us together, we had hundreds of people work for us. All of them in some way have expressed getting into the real estate business. Only one, his name’s Joey, actually did it and is doing it. He forced himself to do a mailer. He asked for my help. I helped him. I edited the whole thing. I priced it with him, and we spent some time on it, and he just sent it in the mail and just started getting it back. We’re helping him purchase two 40-acre properties, really nice properties in New Mexico, and a 20-acre so far. That’s the first day. The first day when the real mail started coming back. And he’s freaked out. He doesn’t know what to do. He’s holding it together pretty well. So, here’s my point. If you send a mailer out, there’s no looking back. Your phone’s going to start to ring. You’re going to start to get signed purchase offers, and then, you’re just going to figure it out.
Jill DeWit: And that’s why we’re here.
Steven Butala1: So forget about your LLC. Forget about your LLC and force yourself to get it into the mail even if it’s all sloppy and taped together.
Jill DeWit: Good job.
Steven Butala1: Today’s topic. Data is your crystal ball. This is the meet of the show. Data has changed everything. Here’s a very short story. Right out of college, I was a commercial real estate broker, a failing commercial real estate broker on the investment side of the business, trying to buy and sell or help people buy and sell long-term care facilities like nursing homes and assisted living facilities, and back in the day, you just pick up the phone and start calling the owners. You had a list of owners. Well, it didn’t work. They weren’t taking my calls, so I devised a system based on data to send everybody a fax number. I would send everybody a fax that said, “Hey, we want to purchase your property for XYZ. Yeah, the number might change. We need to look at your stuff, but we’re real interested in doing that, and I represent this huge, massive company over here.” And it was an overnight smash hit. This is the exact same concept of what we do now. So I had data. After a while, I could predict who was going to respond or how many people were going to respond, how often I had to send them a fax, and on and on and on, whether I needed to send out followup letters or purchase agreements, and I devised this whole system.
Steven Butala1: That’s the same thing that we do. We’re using data, and the outcomes are very predictable and consistent. So I know you have a bunch of stuff to say after my technical rant, but go ahead.
Jill DeWit: You have a lot to say [inaudible 00:07:42], and you’re like … Woo.
Steven Butala1: Well, I guess I do.
Jill DeWit: This is involves data.
Steven Butala1: Well, it’s data, and I’ll talk about data. I’ll talk all day about that.
Jill DeWit: I know, you can do that for an hour. We could be here all day. This is true. You’re welcome. So, I was thinking about data. You use data before … I was giving an example. Before, during, and after. Everything that we do, we use data. One, we use data right in the beginning before. If you’re not using data to help you pick a county and look at how things are moving in that area, looking at days on market, even for land, it’s good to look at what’s going on in the area. Use the data for that. During, well, it’s not possible to do this without data. Good luck trying to send offers to people if you don’t have the data, you don’t have their addresses and the properties and the names and everything that you need to-
Steven Butala1: How big the property is.
Jill DeWit: Exactly.
Steven Butala1: What’s being sold around it or what’s being listed around it.
Jill DeWit: Exactly. If we don’t have the assessor data, it’s not going to work. Doing postcards … Can you imagine sending blanket postcards to land owners in certain areas that just say, “Dear customer, and by the way.”
Steven Butala1: Dear customer.
Jill DeWit: Dear customer with a legal description because that’s all you have, and maybe the [inaudible 00:08:50] will find it? No. That doesn’t work, obviously. So you use it during. And then, after, you have to have data afterwards because you’ve got to aid with the pricing. And I’m even thinking, after, when you go to … You use the data on the buy side and the sell side for pricing and all kinds of things like that. And like I said at the beginning, don’t guess. Use data. I love in this business, just from when I started with you 10 or so years ago to now, it is phenomenal what we have at our fingertips. I can only imagine-
Steven Butala1: It only gets better.
Jill DeWit: What you were looking at 30 years ago doing this and how crazy it is and then to think what it’s going to be like in another 10 years, oh, I’m so excited.
Steven Butala1: And now more than ever, it’s important to have a personal connection with people. That’s one of the reasons social media is so prevalent and so popular. Because we all still want to personally connect even if it is online. And the more data that you have about somebody’s property and them themselves, the more you’re going to be able to manipulate it really easily and connect with them. If you send them an offer that says, “Hey, Sally. Mr. And Mrs. John Jones or John and Sally Jones, it looks like you’ve owned this 40-acre property in Nevada for 20+ years, and it looks like you inherited it from your grandmother, Tillie, and it seems to me from the stuff that we can see, you guys live in Boston and you’re not using it all. So we are out in the western part of the country, and we do buy and sell land, and we’d be happy to take this off your hands if you want to for X price, and we can get the deal done pretty quickly, and we understand that you’re concerned about who to do business with, so please take a look at our website. We have all kinds of stuff posted there. We’ve done a lot of deals with people just like you, and we want you to feel comfortable about it.” Do you think that’s going to work, or do you think this is going to work?
Steven Butala1: To whom it may concern, we are purchasing your-
Jill DeWit: We buy dirt.
Steven Butala1: We buy dirt in Nevada, and you apparently own one. Sign here.
Jill DeWit: Call us. It would be hilarious.
Steven Butala1: So that’s what I’m talking about. That’s the real value of data. And long before they ever get a letter, you’ve identified that part of Nevada over the other parts of Nevada as a really good place to send mail, so data is your crystal ball. If you get a crystal ball like this on Wall Street, you’re going to go to prison.
Jill DeWit: Yeah, it’s true. Isn’t that interesting?
Steven Butala1: This is inside information about what a stock’s going to do, then the next day, and the day after that, with very predictable and consistent results. That’s a felony. With real estate, it’s encouraged.
Jill DeWit: It’s true. Yeah. Yep. You’re hilarious.
Steven Butala1: Well, I know your time is valuable, and thanks for spending some of it with us today. Join us next time for the episode called “The role data plays in property acquisitions and sales.”
Jill DeWit: And we answer your questions. Post on our online community at landinvestors.com. It is free.
Steven Butala1: You are not alone in your real estate ambition.
Steven Butala1: If you can’t tell already, it’s data week this week.
Jill DeWit: I’m so excited. Hey, by the way, if you’ve not found it, check us out on YouTube. We have a lot of great free informational videos and more awesome things coming. And also, while you’re at it, please subscribe and rate us there. We are Steve and Jill.
Steven Butala1: Information.
Jill DeWit: And inspiration.
Steven Butala1: To buy undervalued property.
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