Psychology of Choosing Land Investment as a Career (LA 1622)
Psychology of Choosing Land Investment as a Career (LA 1622)
Transcript:
Steven Jack Butala:
Steve and Jill here.
Jill DeWit:
Hi.
Steven Jack Butala:
Welcome to the Land Academy Show, Entertaining Land Investment talk. I’m Stephen Jack Butala.
Jill DeWit:
And I’m Jill DeWit, broadcasting from the Valley of the Sun.
Steven Jack Butala:
Today, Jill and I talk about the psychology of choosing land investment as a career. It seems simple, but it’s not.
Jill DeWit:
I love this.
Steven Jack Butala:
So do I.
Jill DeWit:
It’s really good. I have two, I think, really good points that I see as, for me personally, why we do this and why it makes sense to me and I’m happy to share. Because I know a lot of people think like I do, and I want to share this.
Steven Jack Butala:
Over the course of the years, I’ve had people way more successful and wealthy than me and way less successful and wealthy than I am make comments on this, and none of it’s wrong. So this show is about the perception, those perceptions.
Jill DeWit:
I think maybe some of it might be wrong, but that’s okay.
Steven Jack 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. And don’t forget to subscribe on the Land Academy YouTube channel and comment on the shows you like.
Jill DeWit:
Steven wrote, “I feel like Land Academy is a cheap code to the game of life in terms of financial precarity. Once you prove the concept to yourself, it’s hard not to evangelize this to all the people you care about, but it’s strange because they look at you like you have two heads.”
Jill DeWit:
I love this. This is why I stopped a long time ago. When people say, “What do you do?” I never really tell them what I do, because they don’t get it. They do look at me like I have two heads. And then it opens up the whole can of worms of me explaining it, and then half hour goes by and they’re still looking at me sideways and I’m like, “I just wasted a half hour. I could have been talking about something more fun or just be doing nothing.”
Steven Jack Butala:
And this falls into the heading of you either get it or you don’t.
Jill DeWit:
Exactly.
Steven Jack Butala:
And you’re not going to tell anybody or sell anybody about the fact … if somebody’s on the fence about whether or not this works …
Jill DeWit:
Let them sit on the fence.
Steven Jack Butala:
They’ll be there forever. They’re not …
Jill DeWit:
Don’t push them on the other side.
Steven Jack Butala:
People come to their own conclusion about whatever they see on the internet or talk to people. They come to their own conclusion about whether or not it works. You can see it in their eyes. Jill and I used to go … this is a long time ago. Before we started Land Academy, just to see what other people are doing, like in 2013 and 14, we would go to these meetups.
Jill DeWit:
Yeah, and sit in the back.
Steven Jack Butala:
And stand in the lobby, and not necessarily even go to the event, just go to the … stand in the lobby, have a cup of coffee and talk to people and listen to people. And of course they were all real estate events about buy and selling houses just like today. Buying and selling houses is ridiculously … and renovating them … inefficient. And we know that. We’ve renovated houses and learned that the hard way. But it consumes … people are just … it has this designer component to it, which fascinates certain people. So when you say to somebody who either wants to or has bought and sold a house and renovated it and made $22,000 that buying and selling land is easier and better, they’re either going to … the light bulbs either are going to immediately go off, or they’re going to say, “That’s the stupidest thing I’ve ever heard.”
Jill DeWit:
And that’s sad. It’s like, “Well, what do you mean? You don’t get to pick the carpet and the wall?” That’s really what they’re doing. They must be fulfilling a love of just shopping, I don’t know, or making something pretty, which I … seriously, I’m a girl. I like to do this too/however, as a career, it’s better to do it for fun as a hobby than as a career. That’s what I would say to these … what really makes the most sense. Do that for fun because you love it, not to make a lot of money. Like Ellen, doesn’t Ellen love to do this? That’s her passion. I think she likes the shopping and the designing and then moving on to the next house.
Steven Jack Butala:
She’s got her own line now I think.
Jill DeWit:
Right. And I don’t think she’s in it for really necessarily the money.
Steven Jack Butala:
Ellen DeGeneres.
Jill DeWit:
Yeah.
Steven Jack Butala:
Oh yeah. When you take a …
Jill DeWit:
Because her show and everything pays the bills.
Steven Jack Butala:
Exactly. If you don’t have a need for profit margin, then buying and selling houses is for you.
Jill DeWit:
Yeah. And fix them up, make them pretty, like a lot of other things in life.
Steven Jack Butala:
Here’s a show that I would have on HGTV if it was …
Jill DeWit:
This ought to be good.
Steven Jack Butala:
… my show about how to renovate houses. It would be me with my head in the corner, talking with a screenshot of a spreadsheet, saying, “This house lost $180,000 because we put in all this cool stuff.” It’s just the truth about it all. It would all be numbers. I don’t know if you’ve ever … if you, listener, have ever, if you’re on a team land investment, sat in front of a computer, in front of a spreadsheet that’s … you’ve got it all dialed in about why you can buy and sell 15 properties in, let’s say, Kentucky, and why you’re going to make $150,000, and explain it to somebody sitting next to you. And a lot of times they go like this. They go back. They literally physically go back in their chairer and cow slightly at all the numbers on the screen.
Steven Jack Butala:
So that’s what land investment is. It’s a lot of numbers on a screen. And there’s a piece of property out there somewhere that needs to meet certain criteria, but it’s really just numbers on a screen.
Jill DeWit:
We talked about that a long time ago.
Steven Jack Butala:
I need to do just do this real quick. Today’s topic, psychology of choosing land investment as a career. This is the meat of the show.
Jill DeWit:
Okay. We talk … because it really is all tied together. So we talked about this a long time ago. When we were just getting started and getting traction online and things like that, we were like, “We could make an HGTV show out of this,” which would really be 10 minutes of us and like 20 minutes of designing, because what we do best is the securing the asset for the people to make it pretty. And when you mirror those two, that’s where the value is. So much of what we do … like when you’re doing houses, you want to do it right. Being that bird dog, you make way more money than your flipper. Think about it. You’re the bird dog. You find the deal. You market it 50 grand, whatever it is. They go and put all … and you do it in … you’re cash in, cash out, 30 days. That’s a very healthy, realistic timeline.
Jill DeWit:
And then you flip it to this guy. He’s not going to be cash in, cash out in 30 days.
Steven Jack Butala:
No.
Jill DeWit:
Especially in today’s environment.
Steven Jack Butala:
Right.
Jill DeWit:
Exactly. And then when he is done in a year, especially with all the delays and everything going on right now, he’s waiting for appliances and all this stuff … I mean, you keep doing it over and over and over again, and the volume of what you’re doing compared to this guy, making it pretty and waiting for the landscaper and then getting it on the market, finding the right guy and dealing with all that, to make 75,000. And you did three in that time. I mean, you just doubled it.
Steven Jack Butala:
I mean, so that’s comparing this business, buying and selling land, to houses. Let’s … that’s …
Jill DeWit:
That’s one thing.
Steven Jack Butala:
That’s a very obvious one.
Jill DeWit:
I was still kind of finishing the whole …
Steven Jack Butala:
Oh, go ahead. I’m sorry, Jill.
Jill DeWit:
I was finishing what we were talking about a little a bit from the question. But then now to get into the real topic, I have two points, but … and you go …
Steven Jack Butala:
No, go ahead.
Jill DeWit:
Oh, you want me to … okay. So here are my two points on today’s topic. I really thought about this, the psychology of choosing this as a career. What’s up … what’s wrong with us? That’s really what I’m saying. What’s wrong with me that I don’t like those other people? That’s what I’m trying to do. I’m trying to put myself in their shoes. And I thought about it, you know what? And I don’t care about their opinions. That’s point number one. I think I let the numbers speak for themselves. I’m not here to prove anything to anybody. I’m not here to do … I’m not here to set the market on fire for the highest retail price per square foot sale or the prettiest or that kind of a thing. So I don’t care. So I’m proud that they don’t get it.
Jill DeWit:
And that kind of goes into number two, is I think that my part B is I like to be a little bit of a rebel, and I …
Steven Jack Butala:
Oh, that didn’t cross my mind here.
Jill DeWit:
… secretly …
Steven Jack Butala:
I love the rebel in you.
Jill DeWit:
… love that they don’t get it. So when people are super successful and they just don’t get it, I’m like, “Yippee ki-yay. That’s great for me. You are not my … ”
Steven Jack Butala:
Never knew this about you.
Jill DeWit:
Mm-hmm (affirmative). Yep. So …
Steven Jack Butala:
I had no idea we were going to talk about this today.
Jill DeWit:
Well, thank you. So those are …
Steven Jack Butala:
It makes you a little more attractive.
Jill DeWit:
Thanks.
Steven Jack Butala:
Jill’s got this kind of [inaudible 00:08:53] component to her personality, and this is confirming that for me.
Jill DeWit:
Thank you. I like going against the grain, in case you hadn’t noticed. What is it for you?
Steven Jack Butala:
Look, here’s my spiel here on this episode. And once again, it’s like your take on this … we don’t talk a lot about these episodes obviously before we record them, so … but I hope some of … there’s some value in that because we get a different perspective. This episode to me is about this. Look, wherever you are right now, I don’t care if you’re driving, sitting at home, walking the kids, walking the dog, I don’t know, or I don’t care where you are in your life. Stop for a second and think about this. You have complete control of your career and changing it entirely in six months. You’re about 10 to 15 phone calls away from doing anything you want. You can own a convenience store. You can flip houses, God forbid. You can own a manufacturing facility. You can own a chain of manufacturing facilities or apartment buildings or any type of business that you want. It’s not hard at all. In fact, I’ve really been kicking around the idea of doing a class on this.
Steven Jack Butala:
So why do we choose land investment over all this other stuff? Well, the root of it for me is risk and reward. I hate risk. Every investor doesn’t like risk. I see the stock market, day trading and all that as very risky. I see it closer to gambling than investing. I see real estate investment itself as pretty risky. I’ve done all types of real estate investment, and I have honestly failed at a lot of it. I haven’t dismally failed, but I’ve come out of it break even, lose a little bit of money, or I just could never get the momentum. So it’s risk/reward for me.
Steven Jack Butala:
And then the second two things that are incredibly important to me are consistency. Great, you did one deal this year and you made $18,000. You can’t live on that. If you can, congratulations. Email me because I want to know how to do that. And then number two, scalability. And they’re very … they go hand in hand. Consistency and scalability are really, really important. So if I buy a convenience store, get a great price for it, negotiate a great leaser, or even buy the building with it, it makes 10 or $15,000 net every month, and I live above it, and now I’m making 10, 15, $20,000 every single month, it’s real consistent. That’s a pretty low risk situation, now I’m listening, especially if I can do it down the street, and then in the next … in the other state and on and on and on. That’s my kind of business.
Steven Jack Butala:
Being a real estate agent, you don’t know where the next … and I don’t mean just now, but I mean over time … you don’t know where the next deal’s going to come from, and so there’s no real consistency in that. There’s no real pride in it. The risk and reward don’t jive. It doesn’t fit the box for me. With land, I have complete and total control over how much I buy, for what price, how often I buy it, how far I scale it. I have complete and total access to capital, in case I find a great $22 million deal tomorrow. Joe and I could raise that in Discord in Land Academy in 15 minutes. And so could you as Land Academy members.
Steven Jack Butala:
So it’s a matter of checking boxes. So first, you got to stop and look at yourself and ask yourself what you want. Number two, it’s got to check these boxes. For me, I just told you what my three boxes are. It checks them all. Consistency, scalability, and virtually no risk at this point in my career at all. And so that’s why I’m in … that’s the psychology of choosing a land investment as my career. It might not make sense to you at all. I’m not sure.
Jill DeWit:
I understand. I don’t know what to say. You were on a roll there. Sorry. I was kind of just listening.
Steven Jack Butala:
No, that’s it. It just makes so much sense to me. And honestly, unless you have something to add, I’ll leave it with this.
Jill DeWit:
Mm-hmm (affirmative). Because my take is totally different. I got … I’m on board.
Steven Jack Butala:
I love buying … I love land itself, but it’s incidental.
Jill DeWit:
That’s true.
Steven Jack Butala:
I would do this with …
Jill DeWit:
I can’t find margins like this anywhere else. That’s the end of it. That’s the last piece for me.
Steven Jack Butala:
It’s misunderstood.
Jill DeWit:
I still am … I can’t think of anything that you could do as easily as we do, not just have a warehouse full of inventory and have the same return that we do. That’s a …
Steven Jack Butala:
I mean, in a word, it’s so controllable. When you buy and sell stock, you can’t control that. Just be honest with yourself. There’s so many people right now that are making so much money in the stock market. There’s a lot of real estate agents that are making money right now in this upswing. Everything’s on its upswing. And so if you’re in business for two years and you’ve had two great years, you’re in for a surprise. At some point, this is going to not … it’s not going to be this way. And I was one of those people early in my career, actually a couple times where I got totally got caught with, wow, boy, I misjudged that from a time standpoint. So the older you get, the more you put safety nets in place for that. But for me, land checks all the boxes.
Jill DeWit:
I love it. Thank you. Happy you could join us today. Five days a week you can find us here on the Land Academy Show.
Steven Jack Butala:
Tomorrow, the episode of the Land Academy Show is called the Truth About Mailer Hate. You are not alone in your real estate ambition. What the heck is mailer hate?
Jill DeWit:
I know we’ve talked about it before, but we haven’t talked about it in a while, and it’s always good to revisit this when we have … because we always have new members joining Land Academy and new people finding us and they’re like, “You send the mail out and you’re sending these offers out. Some are received well and some are not received so well.” And that’s why we call it the hate. And boy, do they let you know it. So we’ll talk all about that tomorrow.
Jill DeWit:
Thank you for tuning in. We hope you find our content valuable, but we really appreciate your support. If you haven’t already, please check out our YouTube channel and hit the subscribe button. We are Steve and Jill.
Steven Jack Butala:
We are Steve and Jill. Information …
Jill DeWit:
… and inspiration …
Steven Jack Butala:
… to buy undervalued property.
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