Top 3 Reasons New Real Estate Investors Fail (LA 1039)
Top 3 Reasons New Real Estate Investors Fail (LA 1039)
Transcript:
Steven Butala: Steve and Jill here.
Jill DeWit: Good day.
Steven Butala: Welcome to the Land Academy show, entertaining land investment talk. I’m Steven Jack Butala.
Jill DeWit: And I’m Jill DeWitt, broadcasting from sunny Southern California.
Steven Butala: Today, Jill and I talk about the top three reasons new real estate investors fail, in our opinion. And I have to share with you, we are pre-recording these episodes because we are happily taking a vacation, a well-deserved vacation, in Santa Barbara the week that these air, or I guess the week before.
Jill DeWit: No, the week these air. Oh no, it was the week before. You’re right. I’m all confused.
Steven Butala: See this big smile right here? See it?
Jill DeWit: So who knows where I’m waking up right now and what we’re doing right now, but we probably just had a week of craziness.
Steven Butala: Yeah, after this is airing, that’s exactly it.
Jill DeWit: Exactly.
Steven Butala: 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: Marcus asks, “I’ve been pricing by zip code and when looking at comps, sometimes there are parcels in different towns, but the same zip code. However, these are parcels in a different county.” That’s nutty.
Steven Butala: It happens all the time. Zip codes are for the post office. The county is for government.
Jill DeWit: Right. “So my gut tells me I’m overthinking this and just price by zip code anyway. This happens because when getting comps, I’ll put X county in the lands of America, et Cetera, and make a list of the prices and acreage for each zip code. Then when I download data for the county, I find new zip codes for which there were no comps. So I go back to the land-”
Steven Butala: This is very intelligent.
Jill DeWit: “-Websites, put in that zip code and bam, there are comps for those zip codes which are located in other counties. I feel like I’m doing something wrong here.”
Steven Butala: You’re not. You’re not doing anything wrong.
Jill DeWit: “It’s been a long week. Sorry, if none of this makes sense.” This is awesome. You’re good Marcus. That’s so darn funny.
Jill DeWit: Alright, so Kevin our moderator, responded already and his reply is, “Marcus, I used to get hung up on finding all the rights of cuts of pricing in a county. Here is the easy way that I use now. Download the data, sort by zip code, copy that zip code column into another tab. Remove duplicates. This is your list of zip codes to price. Then I just go to LandWatch or realtor.com et cetera. Plug in the zip codes and one at a time, get the comps.”
Jill DeWit: Does that make sense to you? Did I answer your question? Sure you did. That was a good quick tip.
Steven Butala: I completely agree with Kevin here. I believe that I knew there’s a larger string that goes on that we don’t have. It’s beyond the scope of reading this here. Poor Joe, you know?
Jill DeWit: Yeah. and our listeners.
Steven Butala: And the fact is this person’s… It’s rural vacant land. If it was [info lots 00:02:59] , I’d have a different answer. They were trying to cash a [info lot 00:00:03:02] mailer. In rural vacant land, the chances are of having a materially different price per acre with comparison values and everything. When half of a zip goes in one county and half’s in the others is very, very, very small. So are you thinking overthinking this? Yeah. Is it a great question? Yup. I can tell that with how you’re manipulating data, you’re gonna do really well.
Jill DeWit: [inaudible 00:03:28] isn’t it amazing that they didn’t get together and figure this out.
Steven Butala: No.
Jill DeWit: Isn’t that great? the post office is running a muck, doing whatever they want because this makes delivery easier.
Steven Butala: Running a muck, running a muck.
Jill DeWit: Doing what they want. Who cares if it’s a different county doesn’t seem to matter. Who Cares? I mean isn’t that interesting?
Steven Butala: No.
Jill DeWit: Because think about, think about people selling things and having deliveries. Amazon for example, different zip codes have different pricing. That might mess with their whole shipping scenario too. But doesn’t matter. Made sense to the post office.
Steven Butala: It’s two governments who don’t care or talk to each other. Doesn’t surprise me at all.
Jill DeWit: Right. They don’t exist. So darn funny.
Steven Butala: Actually I would expect this to happen more.
Jill DeWit: I know, but it’s just hilarious. It just goes to show you get into this world in this business and you think it should make sense and it should all connect and everybody should be working together. Nope, not the case.
Steven Butala: There’s a lot of stuff like this that goes on in the pre-acquisition state of real estate investing that people like Jill and partners like Jill, never know about until years later, like we’re on a show like this talking about it and I have it all resolved for you.
Jill DeWit: I get it. Thank you Steven.
Steven Butala: Today’s topic, the top 3 reasons new real estate investors fail. This is the meat of the show.
Steven Butala: Can I go? Yeah, I’ll just give them my number 1 flat out.
Jill DeWit: You want to say where this came from? I created this topic.
Steven Butala: Yes, she did.
Jill DeWit: Because couple of weeks ago, my team asked me to do a quick video and they gave me this as a topic I’m like, “Oh heck yeah. I’m happy to share what I think.”
Steven Butala: Oh, so you already wrote this all out.
Jill DeWit: Oh well I did a video on it. Yes, I did it. But it’s fun to compare your notes. So I’m gonna let you share your top three and then I’ll share my top three. And I can’t cheat because I wrote it down and I’m going to cover mine up. Cover up my answers. So ready? I want to hear yours. What’s your number one?
Steven Butala: My number one and maybe my number one through three is that it’s not a priority. Period. I’m going to come back to my old guitar thing. If you listen to our show, you’ve heard me say this before, I picked up a guitar and probably purchased a guitar in my life at least three times, maybe five. Never learned how to play it. Why? Not because I can’t do it, not because I’m not smart enough. None of that. I just on a Sunday, probably when I was bored, bought a guitar, started flipping through it, didn’t put it in a calendar, didn’t take it seriously and for whatever reason, something else got sidetracked with something else. Probably land purchasing and selling land. And it just didn’t stick. And I really believe it’s not lack of talent, lack of smarts or life or any of that stuff. Like Jill’s about to tell you it is, it’s this fact, it’s just not high enough on your priority list.
Jill DeWit: That’s your one, two and three. It wasn’t a priority. You weren’t that into it. You didn’t care.
Steven Butala: Okay. We’ve all gone out with people like that, in theoretical attempted romantic relationship.
Jill DeWit: Tell me please, how does this [crosstalk 00:06:47].
Steven Butala: Just sometimes it doesn’t stick. It’s like, “you know what, I’m just not…” [crosstalk 00:06:50]
Jill DeWit: Not that into her?
Steven Butala: Yeah. [crosstalk 00:06:52]
Jill DeWit: She just might not be that into you too.
Steven Butala: Yeah. That’s what I mean. I think it happens with women more than men.
Jill DeWit: True.
Steven Butala: Don’t you think? I think that’s totally one sided.
Jill DeWit: Hmm. Yeah. I think you’re right. I do. We that we’re more intimate. We try to be more into it.
Steven Butala: Really?
Jill DeWit: Yeah.
Steven Butala: Why? Just to see if it’ll click?
Jill DeWit: Yeah, because there’s always people out there that just don’t want to be alone. Come on. We all know people that can’t get by without a boyfriend. It drives me crazy. So they try to make it stick when they’re really not that into the guy. I’m like, just move on.
Steven Butala: I always maybe incorrectly assumed here that women just feel their way through life with feelings.
Jill DeWit: Nope.
Steven Butala: And it’s like, “maybe I’ll have a feeling for this guy tomorrow. Let’s try again.” that’s what I thought it was.
Jill DeWit: No. If they did have a feeling they would move on quicker.
Steven Butala: Guys are like, “can I put up with this? Is that okay? I wonder if this is going to change. She seems okay at this point. Wonder what’ll happen next time.”
Jill DeWit: Do you know what I envision? I envision every guy in the beginning of our relationship goes, “yeah, that’ll work.” And then I just kind of muddle along and then next thing you know they’re getting married. Like, “why are you getting married?” “Because she told me too. She said it’s time.” I feel like that’s So guys go all the way through to retirement. “I guess I’m retiring now. my wife said sign the the paper. So I am and I guess we’re going to get an RV.” I don’t know. That’s how I feel like tell me I’m wrong.
Steven Butala: I think that’s true with a lot of people. Yeah, absolutely. Especially earlier in your life. Young men have tough times separating their new wives from their mothers.
Jill DeWit: Their new wives. Versus their old wives?
Jill DeWit: Well the older you get, the easier that is to do.
Steven Butala: How am I like your mother? You’re not.
Jill DeWit: Oh good.
Steven Butala: You’re not like my mom at all.
Jill DeWit: Thank you.
Steven Butala: You’re not
Jill DeWit: You’re welcome. You want to hear my three?
Steven Butala: Yeah. What is this topic?
Jill DeWit: Okay. The topic is actually business-related, but that was more fun. All right, so the top three reasons I feel new real estate investors fail, and I actually do have three. I will go through them now.
Jill DeWit: Number One: education. I think they skip it. They don’t think they need it. They think they can just dive in and wing it. And guess what? That’s when mistakes happen. So I really think that if you spend some time, whatever you’re gonna do, research it and know what you’re getting into. So that’s my thing. You know, I love when people say, “I’ve been following you for six months reading everything you have. And I spent more time over here with this person’s site and this person’s site” and all that stuff. I’m like, great. That really makes me feel good that I know that they’re doing it. And you know what? They’re doing it on their own. They’re taking ownership for it too. And I love that too.
Jill DeWit: When you’re get educated, and I said this in my, live video I did. It was just a two or three minute video, but I just said, please own it. Don’t run to your mentor or whoever’s helping you and ask them every little thing. You’re going to wear them down. You know, save that. Take ownership, Google stuff, figure out answers on your own for everything you can and save the big stuff for them. So that’s number one.
Jill DeWit: Do you want to comment?
Steven Butala: Yeah I love this.
Jill DeWit: All right, so my number two thing I think I, I’ve watched people fail in this technology. They can’t learn fast enough and I feel bad, but there’s a lot of things that come at you, there’s a lot of moving parts. We’re talking about this today. Any business that you’re starting. When you really get into it, when you realize, wow. We accidentally sometimes make this look easy and you get into it, you realize there’s a lot to it.
Steven Butala: I want to share that conversation. I’m going to be very, very detailed about a conversation that Jill and I had while we were getting dressed together in our bathroom in the morning. This is real straight about it.
Steven Butala: We are in the middle of three startups right now and we will get them done by the end of the yearish. So what is it? July? So that’s not so crazy right. Title Mind, which is a full blown licensed national title Escrow Company. Just like first American. Same credentials, same capabilities ,only for investors. Number two is listinggopher.com which is a a listing service. So we post our properties everywhere anyway, we might as well post yours and charge a little bit for it. All these tools are in the name of you being able to be a deal maker. And the third one is car academy, which is a full blown Land Academy House Academy product with its own parcel fact and texting capability for car owners just to see if they want to sell on that deck.
Steven Butala: And Jill and I are startup people. I swear we were individually born this way and by the forces of the universe we got shoved together and we’re much better off, both of us, collectively and individually for it in my opinion. We have some people that are working with us that are fantastic, but I don’t think that they’re aware of how much details and the stuff that really goes on in a startup. Why the heck are you bringing this up now, Steve? Because if you are a new land or housecat investor or a seasoned real estate investor, if you’re seasoned you know this. You know there’s contracts to sign and you got to read stuff and go through it and it’s not easy. We make it look easy. We talk about the highlights. That’s what these shows are about. 35,000 foot highlights. But there’s contracts and everything. You need to be part attorney part…
Jill DeWit: Businessman…
Steven Butala: I don’t know… Part caveman, part? Yeah.
Jill DeWit: Part boxer sometimes. Because you got to go at it and say this is not right.
Steven Butala: So if for whatever reason, this is always come naturally to me, the startup phase, I’m not a longterm operator and neither is Jill. Jill is, for the most part, a startup person. She feels the best one when we’re really working out the details, putting people in place and then watching the money go up.
Jill DeWit: And letting them run.
Steven Butala: So that’s what you can expect. Either get yourself an operations partner or a secretary essentially in the beginning to file paperwork and or you just can have to grit and bear it.
Steven Butala: All these companies, with the exception of I think the last one, Jill and I started on her own in a bedroom of a townhouse in Scottsdale, Arizona. So I feel qualified in having this little fatherly chat with you. It’s not real simple. I mean actually it’s very easy. It’s very time consuming and requires a tremendous amount of organization and follow through.
Jill DeWit: And there’s a lot of little hurdles along the way. You just got to get through them.
Steven Butala: If you’re the kind of person who’s got a lot of unfinished projects in your life, this is absolutely not for you. Don’t add this one. If you’re just an upfront person and you love the romantic idea of having tons of money and living on the ocean like this, this isn’t for you. If you’re a follow through person who can talk to people on the phone and was really good at math in your whole life, this is absolutely for you. You will end up on the ocean.
Jill DeWit: Great. Can I get back to my list? I love that you just go off on other things. That’s great. This is bipolar Monday. We’re all over the place.
Steven Butala: I’m watching Marcus too and they were [crosstalk 00:00:14:23].
Jill DeWit: Whatever, we’re all over the place. All right, so back to technology. You better learn and it takes time. You might be spending a weekend in excel and that’s just what it takes. What I also want you to get is your business grows, you need to be on the cutting edge and you need to create systems for yourself so you can keep up and get ahead.
Jill DeWit: And then my third one is, this is the one that ties in with yours. The reason I really watch people fail is personal life, and it’s not just me saying that, they’ve come to me and said that. We’ve done numerous surveys like, what was the biggest hurdle on Land Academy. We thought maybe it was funding or maybe it was data or it was maybe technology or we thought that would be that. Nope, the number one biggest thing that our new people say starting out is personal life and perceiving that they don’t have enough time and it’s really just they’re getting in their own way and they say that and I get it and I feel it and I understand that.
Jill DeWit: So whatever you do, whatever you start, you’ve got to really take a step back and commit. Have a talk with yourself. Like don’t go by three guitars, not to pick on you, but before you buy that guitar, sit yourself down and go, “really? Am I really gonna play this guitar?”
Steven Butala: What’s it gonna take to actually… So I can play a couple songs around a campfire, or whatever your goal is.
Jill DeWit: Exactly. Our best, most successful members, they dove in and went at it, didn’t stop. Their first deal was done start to finish in 30, 60 days and they never looked back. Yeah. And that’s what it takes.
Steven Butala: We have a choice and we do shows like this. We have a choice. We can sit here and blow smoke. We can sit here and say, “it doesn’t cost anything to start” just like everybody else does.
Jill DeWit: Can you imagine? You too can be a millionaire. [crosstalk 00:16:22]
Steven Butala: We can tell you how what it really takes. And hopefully save you a lot of time and money.
Jill DeWit: That’s it. I don’t want to waste your time. I don’t want to waste my time, so thanks.
Steven Butala: Hey, we know your time’s valuable. Thanks for spending some of it with us today. I hope you’re not walking around with your tail between your legs and a depression stupor. Join us next time for the episode called “infill lots explained”.
Jill DeWit: And we answer questions posted on our online community found at landinvestors.com. It is free.
Steven Butala: You are not alone in your real estate ambition… or are you?
Jill DeWit: Maybe you are alone. Are you all alone? Oh my gosh. That’s a whole horrible other… Can imagine an infomercial like that. That’s awful. I’m sure they’re out there. Shucks that’d be awful. Like a dating one though. Anyways.
Steven Butala: I always think of like the religious ones that are like that. “Are you feeling alone? Send 1995 to the…” [crosstalk 00:17:19]
Jill DeWit: We’ll pray for you.
Steven Butala: …Saints of New Jersey and a affiliates LLC.
Jill DeWit: That’s hilarious.
Steven Butala: I don’t know why
Jill DeWit: I picked that New Jersey. That’s great. I’m going to stop this madness now. Wherever you’re watching, wherever you are listening, please subscribe and rate us there. We are Steve and Jill.
Steven Butala: Information…
Jill DeWit: And inspiration…
Steven Butala: To buy undervalued property.
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