Jills Recent Successful 11th Hour Land Upsell (LA 1438)

Jills Recent Successful 11th Hour Land Upsell (LA 1438)

Transcript:

Steven Butala:
Steve and Jill here.

Jill DeWit:
Hi.

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 awesome Middle Arizona. Since I was-

Steven Butala:
Scottsdale.

Jill DeWit:
It was so politely, which it was pointed out to me yesterday. What’s with the Southern, I’m so used to saying Southern.

Steven Butala:
Yeah.

Jill DeWit:
Right, so that’s why.

Steven Butala:
Sunny Scottsdale.

Jill DeWit:
Sunny Scottsdale, I’ll change the script.

Jill DeWit:
That’s good. Cool.

Steven Butala:
Did he, Jill and I talk about Jill’s recent successful 11th hour land upsell. I could, could be. Couldn’t be more proud of her.

Jill DeWit:
Thank you very much.

Steven Butala:
We had, many, many, many times it happens, you have adjacent property, you buy two properties, contiguous two or three or four properties altogether. This, these two properties that we Joe and I happened to buy really recently generated a ton of interest. And so well, I’ll ask her about.

Jill DeWit:
I’ll explain it in a little bit.

Steven Butala:
Before we get into it. Let’s take a question posted by one of our members on the land, investors.com online community. It’s free.

Jill DeWit:
Ross wrote “Hi guys. We’re in the process of hiring staff. And my question is specifically about an acquisition manager and a sales manager. Do you think that these two positions should be equal compensation or is one position deserving higher pay? Thanks”.

Jill DeWit:
You wanna go first?

Steven Butala:
You’re like pitting us against each other,

Jill DeWit:
Huh.

Steven Butala:
Cause I think there’s more way more value in the acquisition process and less value in the sales manager, but…

Jill DeWit:
And I feel the opposite.

Steven Butala:
I’m confident. She feels the opposite.

Jill DeWit:
Yeah exactly.

Jill DeWit:
So then that way equal pay.

Steven Butala:
I’ll tell you Ross, I’m not sure that you want to outsource both of those at the same time. Nothing happens. There’s nothing to sell. Unless somebody bought something at a great price where there’s built in equity and then the sales happens automatically. So if you are, if you are and have been the acquisition manager, which Jill and I both kind of do in our, in our life, our professional land life, you’re just shoving it off to salespeople. Basically, they’re just posting it and taking calls and saying, this is how you pay, or this is how we’re going to close. So I think the acquisition manager, hopefully it’s, you should stay on and you should get not managers, but assistance to help you post stuff and, and kind of train somebody and guide them along. And I’ll tell you what worked for us, is hiring family members really early on at this point. Cause you can, they’re going to not, you’re going to have a ‘tiff and some stuff’s going to happen and they’re not going to leave and go screaming off. And it was just worked out well for us.

Jill DeWit:
Well, you have the trust factor and all that too. So if you’ve got someone, that’d be a good someone who wants to learn and get in this with you, which I’m sure someone wants, you start making a few dollars. There’s going to be family members that come, come forward.

Steven Butala:
Yeah.

Jill DeWit:
And say, what are you doing over there?

Steven Butala:
Or a spouse.

Jill DeWit:
Aha, and want to help? That’s a good idea. I love it.

Steven Butala:
It’s philosophically. Let’s say it’s not land business. Do you think acquisitions, like an investment banking they’re paid equally. [crosstalk 00:03:04] If you see a bifurcated investment bank without acquisition, people are going to find properties, companies to buy and people are dealing with selling them, dealing with it.

Jill DeWit:
Right.

Steven Butala:
It’s challenging enough. I was in investment banking. I was always on the South side.

Jill DeWit:
Well, I was going to say in, I think in the majority of organizations, the salespeople are paid the most. They get these rocking commissions because they sell great, big stuff. It’s all marked up. The acquisition guy is an assistant of buying whatever widget and the salesperson’s to move as many widgets at the highest price that they can. And then they’re going to get rock and pay based on that.

Steven Butala:
Yeah. It’s a delicate balance,

Jill DeWit:
It is.

Steven Butala:
But in the real world, not in a land world, sales is more important.

Jill DeWit:
Right?

Steven Butala:
Today’s topic. Jill’s recent successful 11th hour land upsell. This is the meat of the show.

Steven Butala:
[inaudible 00:03:57]

Jill DeWit:
Huh?

Jill DeWit:
So here’s the backstory, bought this property. Two properties, really nice properties from a sweet man in for about 11,000 each, when we close escrow is like $23,000. So two adjacent properties, one’s 22 acres, one was 23 acres and we put them online to sell individually and they were worth about 80 each. And, we marked them one at 57,001 at 60,000. And because that was good price, they’re probably worth even more, now I think of it more like a hundred. Marijuana friendly, excellent access. One of them had road access from the bottom and the top, it was just awesome. Then, and I got so much. I know I should’ve put a sign out there. I never even got to put a sign out there, but I got a photographer, took great photos, a drone images and put them online. And because of the marijuana thing, it’s really hot in this area.

Jill DeWit:
So got a lot of calls and every person and I put them separately, but in the posting I put in there, ‘Hey, by the way, this is one of two, look at the one next door. Happy to cut a deal if you want both’. So, ,the ultimate buyer was really only interested in one. He brought an agent, which was so funny. So an agent calls me, Hey, do you deal with agencies? You commission [inaudible 00:05:19] and I’m like, you know what, not really. I said, it’s not my first choice. I’m not going to let it kill the deal. But, my first choice would be. And so I’ve never talked to the seller or the buyer. I’ve only talked to the agent. I said, my first choice would be, if you guys work it out on your own and he pays you separately, however you guys work that out.

Jill DeWit:
That’s what I’d really like. He said, okay, let me get back to you. 24 hours go by here comes an offer. And he wrote in there he’s own commission has paid separate cash from the, from the buyer and they did their thing. Awesome. His offer was $50,000 cash for one of them. I said, you know what? I’ll take it. I’m really in for like 11 five on this property. I’m like, now I still have the other property. It’s worth 60 almost to let that ride and see what happens. So down the process, everything’s great going through escrow, come to find out for some rare reason. And I don’t want you to get nervous. Cause this is very, very, very, very, very rare. But even though we had two APN’s, the property was never formally all the way on the maps split. So, escrow couldn’t figure out how to do a legal description and the County said, not helping you, you need to get a survey. Like great. So.

Steven Butala:
Which could of been, would of been fine.

Jill DeWit:
Which is fine. [crosstalk 00:06:35] I was going to go down that path.

Steven Butala:
Totally fine.

Jill DeWit:
That’s what I was going to do. So, that’s the whole thing. So it’s not the end of the world. Like it just slows everything down. So I said, okay, great. And I had just done this. I did do another survey and another part, another part of the country, a couple states over. It costs me, I think that one costs me like 2000 bucks 20, maybe I think about $2,200 only because I asked the guy to rush it. It would have been like $1,500, but I’m like, I don’t wanna wait, can we get the stupid thing down? He’s like, yeah, for $2,200, you go to the front of the line. I said, that’s really how it went. I said, fine. I’ll [crosstalk 00:07:10] pay the $2,200 and go to the front of line and get mine done. First.

Jill DeWit:
She was like, sure.

Steven Butala:
You’ve always been a front of the line in, front of the airplane kind off person.

Jill DeWit:
Oh, I am like at a concert. Oh yeah. Front row. Front of the plane. Front of the line. How much? No. Don’t think that you don’t do that. This is okay.

Jill DeWit:
[crosstalk 00:07:26].

Jill DeWit:
Time out. Let me tell you how this man is. This man says “can’t money solve this problem?”

Steven Butala:
Yes.

Jill DeWit:
So I’m not alone here. So going back to the, back to the transaction. I was just told my person, my transaction corner, all right, please call the County, find out who their favorite guy is than does a surveys and get this going. And I hung up the phone. I said, you know what? I’m going to call this agent. And I tried to sell these two together. And I said, look, does he want both? I would like to sell both at same time and make them deal.

Jill DeWit:
“Nah, he really can’t afford it. Doesn’t have the money. You can afford this one, but he can’t, pay cash for this when he can afford and both”. I’m like, you know what fine. So we’re going back. So I, and we’re, this is the 11th hour, we’re like getting ready of wire and close. This was the last stupid thing, the legal going on, the deed where they got hung up. And so, I called the agent back and I said, look, his name was Juan. I said, Hey Juan, is there any chance? I said, we have two choices here. It’s either going to take him a couple of weeks while I wait for this stupid survey and we’re going to finish this. Like we agree no problems or, and I’ll pay for that or I’ll make them a rock and deal. He can have them both for 85, which is a rockin deal.

Jill DeWit:
I thought. Buy one for 50, get the second one for 35. Who can argue with that? He said, “let me call you back”. So then he called me back and said, he can do 80. We’d take it. And I said done. And then within an hour, the suite agent had done a new updated, whatever, addendum to the purchase price. We move the closing two days for him to get the money. And we sold at 80 and I’m very happy that, and then I, so I quickly called my print, stop calling survey guys. I don’t need them after all. She’s like “you’re amazing”. She even said that. She’s like, “you’re amazing. How do you do that?” Like just throw it out there. See what happens.

Steven Butala:
Well, speaking of amazing, here’s my question.

Jill DeWit:
Okay.

Steven Butala:
Because there are people, the vast majority of people, for some reason, negotiation and net price maximization, those things are, we really have to Jill and I have to really undo that for seasoned real estate people,

Jill DeWit:
True.

Steven Butala:
That come into the Land Academy membership area.

Jill DeWit:
It’s true.

Steven Butala:
So, what was the list price on this one? 120?

Jill DeWit:
Yeah, 57 and 60.

Steven Butala:
And what did you sell it for?

Jill DeWit:
80.

Steven Butala:
Does that crush your soul?

Jill DeWit:
Nope.

Steven Butala:
It doesn’t crush mine either. In fact, I think it’s the greatest thing ever. She’s got 23,000 bucks into this thing, sold it for 80. Even, probably after fees is probably over 75, 78, some, some number like that. I would so much rather have be done with it. Get the cash. We don’t have to do a survey. There was no burden of hand situation. And, but there are people. And what do you say to these people is my question. We psychologically can’t come off the purchase price like that.

Jill DeWit:
Yeah, well, they got to get over it.

Steven Butala:
Yeah you have to get over it.

Jill DeWit:
I have to tell them, I know it hurts, but you got to stop it and [crosstalk 00:10:21] because you know, what’s going to happen. If I hold out for maximum price, how much longer is it going to take me six months? Why would I do that? I have this buyer. We are done. We’re all in. He’s got the money. It’s great. He’s excited. You know, he’s now jumping up. Here’s the thing too. He is now jumping up and down.

Steven Butala:
Yeah, as you should be.

Jill DeWit:
That he got, wow. Cause he was taking his buy one for 57. He was happy to accept 50. Now he gets two for 80. I’m like, come on. This is wonderful. And if he wants to, by the way,

Steven Butala:
Classic [inaudible 00:10:53].

Jill DeWit:
He can get that survey done, spend a stupid $2,000, get a survey done and still sell the other one, it makes some money back and I wish him all the best.

Jill DeWit:
It’s, I have to tell people, you have to, you have to think about what’s important here. And for us is we make money on. I talked about this on clubhouse, by the way, a little bit. If you have, if you’re on clubhouse, please come find me just @Jill Dewitt and you will find me, and I do regular Thursday talks on all kinds of different topics. And I, you have to, our way is volume, not maximizing profit, but volume. And this is interesting. Cause we have a topic. I know a podcast coming up in a couple of days. That’s going to be on this, are you a, are you a one? Are you a one deal a month? Are you a one deal a day? And so that’s where you kind of want to be in. I’d have to be one deal a day and moving fast and make a, I’m still going to double my money, [crosstalk 00:11:49] but I don’t need to hold out for five times. What do I really need to hold it for five times? How? Nope. When I’ve got the sky right here. Do [inaudible 00:11:57] questions.

Steven Butala:
No, I think, I mean, I don’t know what else to say your ROI on that deal was for, I keep saying you, but our ROI on that is 400%. And I think we probably owned it. I don’t know if we owned it three [crosstalk 00:12:09] months.

Steven Butala:
Was it weeks?

Jill DeWit:
Weeks, I don’t know what it was.

Steven Butala:
I can’t keep them all straight.

Jill DeWit:
I know. [inaudible 00:12:14]

Steven Butala:
400% ROI is not a full-blown complete win and you have to actually hold out for a hundred thousand or 120 because that’s what it’s worth. Property was easily worth 120, probably more. And it’s going up [crosstalk 00:12:26].

Jill DeWit:
That’s the thing [crosstalk 00:12:28]

Jill DeWit:
[inaudible 00:12:28] 120.

Steven Butala:
Yeah.

Jill DeWit:
Yeah.

Steven Butala:
That’s wholesale.

Jill DeWit:
Mm hmm

Steven Butala:
So, we could have stuck around cut [crosstalk 00:12:33].

Jill DeWit:
150.

Steven Butala:
150 for it.

Jill DeWit:
Yeah.

Steven Butala:
But why.

Jill DeWit:
We don’t that.

Steven Butala:
We’ve already placed the money, the proceeds from that like a day after we got it into other deals. So, that’s how I wrote. So,

Jill DeWit:
Yeah.

Jill DeWit:
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 “Land Academy membership versus owning a franchise. You are not alone in your real estate ambition”.

Steven Butala:
It should be a fun talk. So people are set up to fly solo and some people just need a huge amount of direction when it comes to owning a company. And, and I have a lot to say about that. Turns out

Jill DeWit:
That’s true. Some people need like here’s the equipment you need to buy. Here’s what, here’s the plans for your build-out and, and that I know which one we are. Cause it’s the same. If you need access to any sort of ownership or property details, including owner phone numbers and FEMA flood overlays. If you’re in our businesses is a big deal. Check out neighborscoop.com created by investors. That’s us, for investors. Let’s you.

Steven Butala:
[crosstalk 00:13:43] We are Steve and Jill.

Steven Butala:
Information.

Jill DeWit:
And inspiration.

Steven Butala:
To buy undervalued property.

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