How to Go From Land Hobby Enthusiast to Business Owner (LA 1278)

How to Go From Land Hobby Enthusiast to Business Owner (LA 1278)

Transcript:

Steven Butala:
Steve and Jill here.

Jill DeWit:
Happy Friday.

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 how to go from land hobby enthusiast to business owner. This topic came from a conversation that Jill had recently, very, very recently, with one of our members. One of our long, long time members.

Jill DeWit:
Four years.

Steven Butala:
Yeah. So…

Jill DeWit:
Cool.

Steven Butala:
Before we get into it though, let’s take a question posted by one of our members on the landinvestors.com online community, it’s free.

Jill DeWit:
John asked, “Does anyone know where the land use and property indicator fields come from and what they mean in personalfact.com or neighborscoop.com?” By the way, it’s the same for both. “I contacted the county and they don’t know anything about them.”

Steven Butala:
Yeah. There’s 330 columns of data in the dataset for Parcel Fact and Land Academy and Neighbor Scoop. Neighbor Scoop is Parcel Fact on steroids, so really this question is about Neighbor Scoop, not Parcel Fact. Parcel Fact is just real estate, Neighbor Scoop’s got so many more features. And some of those columns are useless.

Jill DeWit:
Like phone numbers, by the way.

Steven Butala:
Yeah. Phone numbers and flood plain data and all kinds of stuff. So, some of these columns are very, very helpful and some of them are not helpful. And the county, because they’re all exactly the same, there’s 3200 counties in the country, approximately, 3144, and the assessors look at things differently. What that is is the assessor role for the county. So a rural county in Texas where the assessor is also the sheriff, and she’s also the diner owner doesn’t spend a lot of time on a lot of these [crosstalk 00:01:56].

Jill DeWit:
And the only notary.

Steven Butala:
Yeah, doesn’t spend a lot of time versus the County of New York or Manhattan, where they do utilize all that data pretty dramatically. So urban counties and rural counties and everything in between, are very highly different. Land use, if it’s used at all, I’m telling you, it is meaningless, and so is property indicator. What you see all the time, I don’t know why, is land use 400, which means vacant land. Do I rely on that in any way, significantly, to make any decisions? Absolutely not. So John, forget about it.

Jill DeWit:
Yeah, skip it.

Steven Butala:
That’s why they don’t know anything about it. In fact, the aggregator in this case, Real Quest Pro, may even just fill that in for no reason. It may be a post data collection from the assessor or data manipulation.

Jill DeWit:
Everything that falls in this category, they just call it that.

Steven Butala:
So to wrap this up in a little package, you’ll know if it makes sense to you immediately.

Jill DeWit:
I was going to say, land use and property indicator is not zoning.

Steven Butala:
Right.

Jill DeWit:
That’s different.

Steven Butala:
So in a County like LA and zoning’s awesome.

Jill DeWit:
Then I care.

Steven Butala:
We do zoning based mailers.

Jill DeWit:
I care about that.

Steven Butala:
But in a rural county, like most counties in Arkansas, if you call and say, “Hey, what’s the zoning of this property,” what they’ll tell you, literally, quite literally is, “Anything you want it to be. Please don’t call again.”

Jill DeWit:
That’s hilarious.

Steven Butala:
Please don’t call again, you Yankee.

Jill DeWit:
Yeah.

Jill DeWit:
You yuppie from Scottsdale.

Steven Butala:
How do you stop it? How did it go from a land hobby enthusiast to business owner? This-

Jill DeWit:
Or… go ahead.

Steven Butala:
This is the meat of the show.

Jill DeWit:
Or you liberal nut from California.

Steven Butala:
Yep.

Jill DeWit:
I don’t know.

Steven Butala:
We’ve been called a lot of stuff.

Jill DeWit:
What else can you recall? Let’s see…

Steven Butala:
Couldn’t be farther from the truth, by the way.

Jill DeWit:
You, brain-fried pot smoking…I’m just kidding. I don’t know.

Steven Butala:
Hippie want to be.

Jill DeWit:
Hippie from the Bay area.

Steven Butala:
Thanks for wrecking every single election that I’ve ever watched going across the country, right at the end.

Jill DeWit:
That’s right. Where are you from? We hate you guys. The only way you can win, if you say I was born here, I was raised here, my mom’s from here. You need to cover all parts of the country.

Steven Butala:
To which I say-

Jill DeWit:
I’m a melting pot.

Steven Butala:
Man, you and I have a lot more in common than you really think.

Jill DeWit:
There we go. And let them just run with that.

Steven Butala:
I can calm him down.

Jill DeWit:
That’s good. Okay. So, to how to go… here’s what happened? Are we in the show, right now?

Steven Butala:
Yeah.

Jill DeWit:
Okay. So I had a call with a member a couple of days ago and we’re just kind of chatting, and I found out as I uncover, he’s stuck in hobby mode and I’m like, “Why are you stuck in hobby mode?” I asked him more. It was very interesting. He’s been with us for four years, been very happy, loves us, loves the education, loves the tools, everything about it, and he thinks he’s done really well. I said, that’s great. Tell me your numbers. “I bought less than 10 properties, and it’s just a hobby.” I’m like, “Why is that?” So we talked for a little bit and I hung up the phone and I thought about for a little bit, and I realized he’s probably going to stay in hobby mode.

Jill DeWit:
I gave him some suggestions and stuff, but it’s he already knew. I’m like, why don’t you sell them and buy 10 more kind of thing.

Steven Butala:
What’d he say?

Jill DeWit:
I could. It was just kind of like, that’s his kind of-

Steven Butala:
That’s fascinating.

Jill DeWit:
He felt really good about it. His experience was great because he bought that many properties. And I’m like, “And?” And actually the conversation was about checking in. He’s happy to be back at his job. He got a job again, either went back to, or got a new job and feeling very good about that. Sounded like, never been hurt, wasn’t hurting at all financially through this whole virus times, and that’s just kind of who he is. And I was thinking about, gosh, how many people in our community are sitting in hobby mode that I don’t know about?

Jill DeWit:
And they may be happy in hobby mode, but-

Steven Butala:
Well, they’re obviously happy mode.

Jill DeWit:
I guess so. They’re being- [crosstalk 00:06:19].

Steven Butala:
They’d make some changes.

Jill DeWit:
That’s true. They would. So I’m thinking about, gosh, okay, so what is it? It’s obviously something in the person, it’s not that you don’t know how to do this. It’s not like you don’t have these tools. It’s not like you don’t have the money.

Steven Butala:
They’ve proved the concept.

Jill DeWit:
Everything. Proved the concept.

Steven Butala:
10 times.

Jill DeWit:
So there’s something about it that they don’t want to make this a business. And I would say they’re just not business owners, period. I mean, for me at the end of the day, it’s not this business. I think it’s any business. There’s just a lot of people that aren’t cut out to be business owners. They probably aren’t cut out to have employees. I don’t want to pick on people. Tell me if I’m-

Steven Butala:
No.

Jill DeWit:
Oh, okay.

Steven Butala:
No, I just think that they’re… and I’m not capable of doing something halfway. I mean, I’m either going to do it or I’m going to not do it.

Steven Butala:
If it’s worth doing, because my dad used to say this to me all the time, if it’s worth doing, it’s worth doing right. And so, I would’ve, if I… Here’s a great example of a conversation I just had with a very successful real estate person in multi-tenant stuff. I said, “I’ve flipped several houses and renovated them, and I don’t care if someone dropped out of an education program like Land Academy or House Academy that outlined step-by-step, there’s no chance that you can fail at renovating a house and make a million bucks a year. I would not do it. I wouldn’t even kid myself because I can’t stand renovating houses. I can’t stand it. I can’t stand picking out curtains, moving walls around, picking out appliances, yelling at contractors. I hate everything about it.” [crosstalk 00:07:56].

Jill DeWit:
It’s not that it can’t be done, it’s just you personally, internally don’t like those deals.

Steven Butala:
Right. So, I think that’s what’s going on. Like, if you do a few deals and you make a bunch of money and you say, “You know, just, this is not for me. I don’t like it.” Then I get that, but tell yourself that and then get out.

Jill DeWit:
Well, or I would argue that it’s probably, for some people it’s bigger than that. Because here’s the thing for you. You could do it. You’re choosing not to, but you are choosing to be a business owner. You are choosing to do it a different way. Okay. Well, this person went back to a paycheck. I’m trying to figure out, are they not a property type person or are they not a business owner?

Steven Butala:
Well, the switch didn’t flip for them. The people that are in the advanced group, after the first deal, they all say the same thing, and it’s some version of, “Boy, I stuck that needle in my arm the first time, and now I’m addicted and I love every minute of it.”

Jill DeWit:
Right.

Steven Butala:
And I stuck the house renovation needle in my arm and I couldn’t pull it off fast enough and run away.

Jill DeWit:
Right. So what would you say is the number one thing to overcome to go from hobby to business owner?

Steven Butala:
Well, I don’t think that for a person like me, it was never a hobby. I did the first deal and I said, this is what I’m going to do for the rest of my life. And I’m going to build an empire.

Jill DeWit:
Well, wait a minute. What about, I’m not picking on you here-

Steven Butala:
No, that’s okay.

Jill DeWit:
Because you started this-

Steven Butala:
I think this is good for people to hear.

Jill DeWit:
Yeah, but I would argue that you did do it for a hobby initially. Because you were doing it, you didn’t dive into it head first, you tested this.

Steven Butala:
I dove it into headfirst to prove a concept.

Jill DeWit:
Wait a minute. You had another job though.

Steven Butala:
Yep.

Jill DeWit:
And you didn’t immediately leave your other job?

Steven Butala:
I almost immediately left it.

Jill DeWit:
Well, but still you had another job while you were doing this and flipping properties and said, “All right, there’s something to this.”

Steven Butala:
I bought an 80 acre property from Ohio on eBay, repackaged it up and sold it for twice what I paid.

Jill DeWit:
Right.

Steven Butala:
All in the matter of 30 days.

Jill DeWit:
Right.

Steven Butala:
I said to myself, right then, I remember this like it was yesterday, “This is what I’m going to do for the rest of my life after I test it and make sure that just wasn’t a fluke.”

Jill DeWit:
Right.

Steven Butala:
And I did, and I kept my job for two years in one way or another, until I was making way more money than what my paycheck was for.

Jill DeWit:
Right.

Steven Butala:
And I left and here we are several years, a lot of years, decades later.

Jill DeWit:
Okay. Because in your head, this wasn’t just making money on the side.

Steven Butala:
No, I skipped the hobby phase.

Jill DeWit:
Okay.

Steven Butala:
You know, I don’t-

Jill DeWit:
So what about people in the hobby phase, what would you say?

Steven Butala:
I’m going to sound like your father, now. I would have a hard, good look, talk with yourself in the mirror. This is a great side gig for some people, you can do five or 10 properties and make an amazing living a year. So if that’s what you’re calling a hobby, then I guess you’re happy. But a hobby to me is like-

Jill DeWit:
Renovating cars.

Steven Butala:
Yeah, I mean, you don’t necessarily do it for money.

Jill DeWit:
Right.

Steven Butala:
You do it because you enjoy it. Like doing a puzzle, there’s no money component to it. [crosstalk 00:11:02] I’m telling you, you’re renovating a car, if you make any money, you have magic dust or something.

Jill DeWit:
Yeah. It’s definitely, there’s a love, it’s a passion.

Steven Butala:
You don’t make money renovating cars.

Jill DeWit:
It’s a passion project.

Steven Butala:
Right.

Jill DeWit:
On this, this is not a passion project. [crosstalk 00:11:14]

Steven Butala:
Hobby enthusiast might not be the right phrase here.

Jill DeWit:
Right.

Steven Butala:
The question is, how do you go from amateur to pro?

Jill DeWit:
Right.

Steven Butala:
And the reason that you know you’re an amateur and not just a hobby enthusiast is because the needle thing in the arm.

Jill DeWit:
That’s good.

Steven Butala:
So, if you’re not listening to this, you should be listening to this saying, “All right, I believe it’s obvious that this works. I’m a data person. I want to own my own business. The W2 thing doesn’t work for me. And I want to get rich and I want to feel good about doing it and provide for my family and do some amazing stuff with my life from a financial standpoint.” Then you’re in the right place. If you want a little side gig where you make a couple of hundred thousand dollars a year, you’re in the right place. If you want a hobby, there’s a lot of other podcasts for you.

Jill DeWit:
You know what, though? I would end on this for me, if I may, I think there’s a lot of people in our group. Not a lot, I think there was some in our group that it does start off as a hobby. Like, let’s just see what this is about. It’s kind of cool. Maybe they’re just trying to buy their dream vacation property or something like their dream property to build their house on. And this is a fun way to look at properties, get to know the area, find their dream home with the view and everything like that.

Jill DeWit:
But what could happen? They go from hobby to uh-oh amateur. Like, if I buy these other five, even though I don’t want to build on it, these other five are going to make me money. So I think that’s it.

Steven Butala:
See, you’ve got the needle in your arm.

Jill DeWit:
So, I think that’s it. I think that is an amazing answer. You’re going from hobby accidentally to amateur, and then you go to pro. You go, all right, now we’re going to times 10 this.

Steven Butala:
Yeah.

Jill DeWit:
That’s the answer. Happy you could join us today. Every Monday, Wednesday, and Friday this week, you’ll find us on the Land Academy show. Tuesdays and Thursdays, we are on the House Academy show

Steven Butala:
Next week, join us on the Land Academy show for another interesting episode, you are not alone in your real estate ambition. You have a great weekend, everybody.

Jill DeWit:
Yay. The Land Academy show remains commercial free for you, our loyal listener. So wherever you’re watching or wherever you’re listing, please subscribe and rate us there.

Steven Butala:
We are Steve and Jill.

Jill DeWit:
We are Steve and Jill.

Steven Butala:
Information-

Jill DeWit:
And inspiration-

Steven Butala:
…to buy undervalued property.

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