Offer Campaign Saturation Fact of Fiction (LA 1406)

Offer Campaign Saturation Fact of Fiction (LA 1406)

Transcript:

Steven Butala:
Steve and Jill here.

Jill DeWit:
Hello.

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

Jill DeWit:
And I’m Jill De Wit broadcasting from sunny Southern California.

Steven Butala:
Today Jill and I talk about offer campaigns. Is it a saturation? Is it fact or fiction?

Jill DeWit:
I-

Steven Butala:
What is offer campaign saturation?

Jill DeWit:
Well I think it’s both. Hold on a second. The fact and fiction, is that fair? Can I say that?

Steven Butala:
Yeah. It’s not fiction on our part.

Jill DeWit:
Right.

Steven Butala:
Well, I’m going to give the facts.

Jill DeWit:
Okay, yeah. Yeah.

Steven Butala:
And then you’re going to decide whether or not it’s fiction.

Jill DeWit:
Okay, wait. There is a number to the properties, kind of. People always say they can’t make more property, but you could subdivide, but we’re not going to get into that. I’m not going to start a little argument about that, right?

Steven Butala:
Me either.

Jill DeWit:
Okay. Thank you. And there are countries that are making more land, like Holland. We’re not even going to go there. That doesn’t count. But so there is a fact to the numbers. But when you really take a step back and look at how many of us are doing it and doing this well, and actually doing mail and sending things out and buying property, the number gets smaller and smaller and smaller and smaller.
So, do I worry and panic about it, is kind of the fiction for me.

Steven Butala:
Yeah.

Jill DeWit:
So, that’s where I’m at.
We all have life insurance. We all have all kinds of insurance. I have fire insurance. I have flood insurance. Look where we live, you guys.
By the way, I have to get tsunami insurance because of what’s behind me. It’s the weirdest thing. We’re technically in a tsunami zone because of the water behind me. Do I really worry that I’m going to use a tsunami insurance? No, but I have it.
So it kind of ties into this too, you know? I’m like, all right fact, or fiction? Fact, I have to get tsunami insurance. Fiction, is it really going to happen? Probably not, hasn’t happened yet.

Steven Butala:
I don’t think it’s ever happened here.

Jill DeWit:
I know.

Steven Butala:
Is there ever been a tsunami in Los Angeles?

Jill DeWit:
No, but we’re in a tsunami zone. We have to call it that.

Steven Butala:
So if there’s never been a tsunami-

Jill DeWit:
Yeah.

Steven Butala:
Off of LA’s coast, wouldn’t it be awesome if you were the insurance company who sold insurance?

Jill DeWit:
I want that job. Yes.

Steven Butala:
That’s something that’s probably never going to happen.

Jill DeWit:
New business model being formed right now.

Steven Butala:
That’s what side of this thing you’re on.

Jill DeWit:
Yep.

Steven Butala:
That’s what side of this real estate mailing thing that we’re all on.

Jill DeWit:
Exactly.

Steven Butala:
We’re on the blackjack dealer’s side.

Jill DeWit:
Ooh, I like that.

Steven Butala:
The odds are way in our favor that it’s going to go the way we want it.

Jill DeWit:
But the blackjack player still thinks they’re going to win.

Steven Butala:
That’s right.
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:
That was a really good analogy, by the way. I like that. That’s good. Leonard wrote, “Hello, Land Academy members. Most of what I’ve heard about from the weekly calls in regards to improving property follows the thinking. “Don’t look at it, don’t touch it. Don’t breathe on it,” in quotes. Then occasionally Steve suggests dropping a mobile home on it. How is this possible? When researching comps for some acquisitions in California, all of the realtors asked about if the lots had wells and if not, could I get one installed, suggesting that the property price would increase 60 to a 100% just because there is a well on the property. Example, lot without a well $50,000 value, with the well $80,000 and of course, a lower days on market. This demand is apparently result because of the agriculture, like marijuana.”
I’m familiar with some of those properties myself, “And water shortages,” yep. “Has anyone experienced a similar situation? My thought is to get a permit for a well and then tell the story in my listing. Or should I just try this on one property, cost of course, depending on the water. Of course you’re putting them at five to $10,000 is pretty good number, around 10. Currently buying four lots, thoughts? Thanks, Leonard.”

Steven Butala:
We’re going through this situation right now on multiple properties in multiple counties. And I will tell you, I don’t think it matters. But if you’re buying four adjacent properties and to get a well in there, is five to 10 grand, and you can split the well. Or you can in Arizona for sure. I’m not sure about California. I’m pretty sure you can.
Like the four users of the property can use one well. They can share it. Man, now you’re talking about $2,500 a well.

Jill DeWit:
Mm-hmm (affirmative).

Steven Butala:
So that’s a positive, positive situation. I don’t really think improving property in this way is worth it.
I think that if you put all the energy that it takes to figure out who’s going to do the well, make the phone calls, there’s a lot of stuff involved. I’m sure there’s California permitting issues. I don’t think it’s going to be go out there and drill a well. Because this is how it is in Arizona. You just go out and drill the well after you get a permit, which is signing your name in a couple of places and drill. And that’s over. You can pull as much water as you want out of there. Not that way in California at all, after you get all said and done, I just think that if you put all your energy into buying more property, because that’s really what we do here, we’re experts at that. It’s going to pay out better that way.

Jill DeWit:
You know, I would only add this. Some people in our community and our world like to buy and hold the properties. And they like to lease them out. Right? Or, you know, rent. I don’t know if they do, I mean, it’s kind of seller finance. But there could be a play there just to say, because if you ever did want to own a property and do something with it, like this Leonard, I don’t know. Because you can make some extra money on the well, just a thought. But it’s a whole lot of work. You know what? And then it taps into, is it really passive income? Because everybody says that and it’s not passive income.

Steven Butala:
No. So I mean, if you’ve chosen, this kind of goes along with our topic today.

Jill DeWit:
Right.

Steven Butala:
If you are going to do business in three counties and that’s it for the rest of your life and you get to know the well driller, you become a well driller. We’re actually doing something like that with a partner now where we’re actually becoming the well drilling company and the septic installer and all of that stuff. So it brings your cost down very, very, brings your cost way down for the same reason that we bought a bulk mail company, because we send a lot of mail out.

Jill DeWit:
Right.

Steven Butala:
So offer to [inaudible 00:06:36]. So if that’s the deal, then I get it. But if you’re just going to put a well in for four properties in a single County in California, I don’t think it’s worth it.

Jill DeWit:
Right. That’s to say you’re going down that path that I have gone down many times where I’ve looked back and said, “Darn, I shouldn’t have done that. How much time did that cost? How many long did I wait? All the paperwork, all the hassle, all the meetings that had to be approved upon.”

Steven Butala:
It’s just time.

Jill DeWit:
And then it took six months longer to sell because of all of this. I should’ve just taken the cash and run.

Steven Butala:
Yeah.

Jill DeWit:
That’s the trade off and the discussion you have to have with yourself.

Steven Butala:
Which brings me back to Leonard’s first sentence here. “With the occasional time that Steve says drop a mobile home on it and walk away,” I don’t mean install a mobile home. I don’t mean buy new Clayton for $180,000. I mean buy a piece of junk mobile home from a used dealer, couple miles away and offer to pay him two grand to go drop the thing on there, nicely and walk away.
And so you can tell a story in your posting like, this property has a mobile home on it. I don’t know if it’s installed. I don’t know what’s going on, if it’s livable or whatever. Or even take it a step further and say, we dropped a mobile home in this property. It’s not connected to anything. Here it is. And it’s yours. It comes with the property.

Jill DeWit:
Mm-hmm (affirmative).

Steven Butala:
Now, that took me maybe an hour to complete the entire thing and a couple grand. And so now I’m still in the business of buying and selling land. I’m not in a well installation business.

Jill DeWit:
There you go.

Steven Butala:
Today’s topic offer campaign saturation. Is it fact or fiction?
Well, let’s start with the facts. There are a hundred, and like I said, yesterday, 155 million or so parcels available to purchase in this country. It’s not government land. It’s not BLM land. It’s not state, it’s not a reservation. It’s none of that. It’s city owned property available to purchase for private parties. It’s called private party land, which is what we are private parties, all of us.
There’s 3,144 counties or parishes ish. It’s very close to that, depending on how you look at Washington DC and some other stuff. If 300 people send out between 1,000 and 1,500 units a month consistently, which no one does not even us, I’m being very conservative here. That’s 450,000 units of mail a month for 155 million properties, that’s going to take 345 months to get through all that. If we are all just machines and just kept doing it, or 30 years, that’s the equivalent to 30 years.
So here’s the deal. That’s assuming that, Jill just brought this up before we were talking about that, that property would turn over every 30 years and they don’t. Properties turn over when certain life circumstances turnover.

Jill DeWit:
Well, that’s assuming you buy every one too. You’re not going to send out 1500 units and buy them all.

Steven Butala:
Right.
So this question, the root of why I chose this topic today is because Jill and I were talking earlier today, we actually had a meeting on this with some of our Land Academy staff. There’s four or five topics that’s just come up with four or 5% of the people that join Land Academy because they’re brand new. And so I want to address these. And we’re going to consistently address these and dispel these myths.
It’s very logical to think, “Oh wait. I’m in this group, everybody’s looking for these counties to send mail to.” I’m like, I just started.

Jill DeWit:
I’m behind. I’m too late. I missed the show. No.

Steven Butala:
It’s just not the case at all. This problem happens. The saturation notion happens because when people are new, they want to buy ultra, ultra cheap property. I just wrote a blog on this. I think it got released today actually, between 50 and a hundred dollars an acre because they’ve never owned any real estate. And they want to go through the motions of buying and selling property, which I totally get. And pat themselves on the back and say, “I bought a piece of property for $500,000 and sold it for 2,500.” Which I totally respect and we recommend doing that.
There’s about five or eight, maybe 10 counties in the country that you can do them in. And I’m going to list them here in a second. And that’s where these problems start. That is where it’s saturated. So if you do choose one of these counties I’m going to list, expect a tremendous amount of competition.
And I like to say this a lot. We don’t have dart boards in our office. The data’s going to tell you what to do. If you do the red, yellow, green test that Jill and I have devised.

Jill DeWit:
Yeah.

Steven Butala:
It’ll immediately tell you, “No, you should never buy property there.” So there’s no mystery in this. There’s no mystery of saturation. The mystery at the saturation actually happens in the following counties, San Bernardino County, California, Riverside, California, Inyo, California, Imperial, California, Navajo, Arizona, Apache, Arizona, what’s? Costilla County, Colorado, that’s a tip top of the list for some reason. Lake County, Oregon, every single County in Nevada with the exception of Clark County, which is where Las Vegas is, Iron County, Utah. I want to know how many that is.

Jill DeWit:
What about Southern Arizona?

Steven Butala:
No, Southern Arizona’s actually, I don’t think Southern Arizona is saturated because it’s expensive and it’s getting more expensive. You know what I’m saying? So I would not start there at all.

Jill DeWit:
Texas?

Steven Butala:
Texas. West, Texas. That’s what I forgot.

Jill DeWit:
Yeah, okay. I’m trying to think.

Steven Butala:
There’s two counties in West Texas that, the County themselves aren’t sure where the properties are. All of the desert counties in New Mexico are places that I think are saturated.

Jill DeWit:
Florida? It seems like it-

Steven Butala:
I don’t think so.

Jill DeWit:
Okay.

Steven Butala:
I think Florida is pretty good, especially if you live in Florida and you know your way around the state.

Jill DeWit:
Okay.

Steven Butala:
So everybody in the Northeast, which is a huge densely populated area, wants to buy a property in Florida. You know?

Jill DeWit:
Absolutely.

Steven Butala:
So it’s not a hard place to sell.

Jill DeWit:
Good point.

Steven Butala:
And it seems to move. Again, I can’t express this enough. If you apply the red, yellow, green test-

Jill DeWit:
Yeah.

Steven Butala:
It’s going to tell you exactly where to go. If you apply the red, yellow, green test to every property in every County in Wyoming, let’s say, just for example, or Washington state or whatever, it’s going to show you where to send mail.

Jill DeWit:
Right.

Steven Butala:
And here’s my other point. After you buy four or five properties after you send out some mail and correctly do it, you buy four or five or eight or 10 properties. Jill always suggests that you get 10 properties under your belt before you really are going to decide if you’re going to take it to the next level, if you enjoy it, if it’s something for you.
Within those travels between zero and 10, you will meet people. You’ll talk to some County officials. You’ll talk to a seller or a group of sellers, or find a little area that becomes your niche, where you specialize in everything.

Jill DeWit:
Right.

Steven Butala:
In fact, Leonard’s story is great here. Maybe his specialization is going to be drilling wells in one or two counties in California, and that’s it or dropping mobiles on one or two counties that don’t care that you do that.
So the saturation, it’s fiction. It’s only a fact if you just concentrate on the super ultra inexpensive desert properties. And by the way, if you want to send mail there and you’ve got a great property that passes all the five A’s, it’s ultra ultra cheap, you’re going to sell it.
There’s this fear that I’m trying to dispel of wasting money on mail and not sending it in the right place. So between that, the raw numbers, and the niche thing that’s going to happen between zero and 10 properties, and land investors, the discord group that we have, and the accountability group that we have, we’re not going to let you fail.

Jill DeWit:
Yeah.

Steven Butala:
So these questions come from people who are the types of people that are, they’re just shaking nervous in the beginning. And they need to, rather than going through all the education and listening to the show, like this show, and spending a lot of time learning.

Jill DeWit:
Right.

Steven Butala:
They’re scared. And there’s no reason to be scared at all if you just methodically go through all this and just take it step by step.

Jill DeWit:
Awesome.

Steven Butala:
Jill, you can’t just let me-

Jill DeWit:
I don’t have anything. You just ran with it. And I love it. You had so much to say. This was kind of your, hey come on, we’ve all done this. We’ve had plenty of shows where it was my topic. And I just took it and ran with it. Kind of like the one show before this, I did all the talking about the staff.

Steven Butala:
Because I know you have a lot to add on this, because I know this comes up a lot.

Jill DeWit:
I did.

Steven Butala:
Does it come up in your ladies group?

Jill DeWit:
I tried to get it in there. Just kidding. I’m joking. So no, this doesn’t come up in our group at all. Oh my gosh, no. Because we’re way past that.

Steven Butala:
That’s what I figured.

Jill DeWit:
No, no, my goodness. All my group, in my group, everyone is an established female investor. We’re all over. This is done. This is not a concern at all. We’re way past that. We’re building dream teams. We’re working out balance. We’re dealing with how to grow the company, who do I include? Is my husband make the cut? You know, that kind of a thing. It’s not this.

Steven Butala:
Okay, good.

Jill DeWit:
Yeah.

Steven Butala:
Actually, that’s making my point. I [crosstalk 00:00:16:33]-

Jill DeWit:
And specializing, niches, more of a niche, more specializing. So not in my group, I am involved in other groups. And you know, that’s the whole thing you didn’t even talk about. I will say this. I’m involved in a lot of other, not a lot, several other female focused real estate investment groups in all kinds of social media. And you’re just talking land. We’re not talking all the little niche-y things. Some people want to do Airbnb. Some people want to do a rent out home. Some people want to flip homes. When you get into those property types, now there’s 10 more niches.

Steven Butala:
I agree with you completely. And I know that’s true. There’s always another deal. You wake up in the morning and if you have a good mail system going, there’s always one, two, five, eight deals in the mail or in an email or on the phone, or, there’s always deals. So it gets a little frustrating for us after a while answering this question because after your first two or three deals, it’ll just be like-

Jill DeWit:
Yeah. Hang with us.

Steven Butala:
Yeah.

Jill DeWit:
Trust us.

Steven Butala:
That’s it.

Jill DeWit:
Don’t go there. We’ve talked about it again. We beaten the dead horse and we got this. Happy you could join us today. Five days a week, you can find us right here on the Land Academy Show.

Steven Butala:
Tomorrow, the episode on the Land Academy Show is called 2021 market update. The 2021, you know, the year market update. You are not alone in your real estate ambition.

Jill DeWit:
I have lovingly called the title, “It’s a 2021 market update by Steven.”

Steven Butala:
Oh.

Jill DeWit:
That’s really what it is.

Steven Butala:
Boy, when do I ever say this? It’s all good news.

Jill DeWit:
Oh, totally.

Steven Butala:
The real estate market that we’re heading into, not just next year, but probably more than that, is fantastic news for all of us.

Jill DeWit:
Totally. Thank you for tuning in. We hope you find our content valuable and we’d really appreciate your support. If you haven’t already, please get on over to our YouTube channel and hit the subscribe button.

Steven Butala:
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Jill DeWit:
We are Steve and Jill.

Steven Butala:
We are Steve and Jill.
Information-

Jill DeWit:
And inspiration-

Steven Butala:
To buy undervalued property.

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