Jack Thursday – Numbers (LA 1711)
Jack Thursday – Numbers (LA 1711)
Transcript:
Steven Jack Butala:
Steven and Jill here.
Jill K DeWit:
Hello.
Steven Jack Butala:
Welcome to the Land Academy Show entertaining land investment talk. I’m Steven Jack Butala.
Jill K DeWit:
And I’m Jill DeWit broadcasting from the valley of the sun.
Steven Jack Butala:
Today’s Jack Thursday. And this episode is called numbers. And I’m going to surprise, surprise, share my thoughts on why everything starts and ends with the numbers in business.
Jill K DeWit:
I understand. Hey, before we do that, can we do our fun thing?
Steven Jack Butala:
Sure.
Jill K DeWit:
Okay. So we mentioned yesterday, we were talking about from the question that [crosstalk 00:00:36].
Steven Jack Butala:
We’re the nicest people in the country.
Jill K DeWit:
Aaron wrote, hold, please. Yeah, Aaron wrote, and we launched into this question about like it was picking an address and picking area code for you to have as your home base for your mailer in your company. So we’re thinking one of my ideas was what if you just researched and picked where the nicest people are in the country, and you use that as your place to have your phone number and everything tied to because everybody knows that you’re so nice. What’s funny is I guess two of the top three, I’m pretty proud of myself. So do you want to share?
Steven Jack Butala:
Yeah, you did. Well, this comes from a survey. This is 2022, where big seven travel. We have no affiliation in any way, asked 1.5 million of their social media followers to vote by state where the friendliest, nicest people are. And the results are.
Jill K DeWit:
Let’s do the top three. Number one, this one, I didn’t guess. Minnesota. That’s number one. I love it.
Steven Jack Butala:
I can tell you with personal experience. There are a lot of people from Minnesota that are snowbirds here in Phoenix right now.
Jill K DeWit:
Yeah.
Steven Jack Butala:
They are the nicest people.
Jill K DeWit:
Yeah. Number two and number three, I guessed, I got Tennessee, and I was thinking there’s probably someone we don’t even hear about like South Carolina by golly; they’re number three. Here’s what’s funnier.
Steven Jack Butala:
Keep going down the list.
Jill K DeWit:
Do you know what the meanest are? Oh, you want to keep going?
Steven Jack Butala:
Oh, there’s meanest.
Jill K DeWit:
Oh, I wrote, oh wait. I’ve worked ahead on my project.
Steven Jack Butala:
I’m going to reel down the list.
Jill K DeWit:
Can you do the nicest? And then I’m going to add mine.
Steven Jack Butala:
Number four is Texas, number five, Wyoming. Number six, Indiana, a little bit of surprise there. Number seven, Colorado, no surprise. Number eight, Kansas. Number nine, Oklahoma, no surprises here at all. Number 10 Hawaii, which was very surprising.
Jill K DeWit:
Now let me add my research because this is funnier. This is what it said are the meanest people in the country? Number one is; New Mexico.
Steven Jack Butala:
What? Really?
Jill K DeWit:
I know.
Steven Jack Butala:
That’s strange.
Jill K DeWit:
I know. And number two is; Arkansas. Okay. Then wait.
Steven Jack Butala:
That’s not right.
Jill K DeWit:
That’s what this says. I’m not kidding. And it said even like New Mexico, even though they may have friendly names of their towns are not that nice. And then this is even better. I wrote down the happiest and the unhappiest. This is a different study. They used 31 metrics. It was like a medical group, like a hospital that did this one on the happiest and the unhappiest. And they used 31 metrics, including unemployment and suicide rates. Not kidding.
Steven Jack Butala:
Jeez.
Jill K DeWit:
I know it’s kind of scary. So the happiest state in the country is, do you know?
Steven Jack Butala:
I have cheated. I looked at it, so I do know.
Jill K DeWit:
Okay, Utah.
Steven Jack Butala:
Yeah. I’m surprised that Utah didn’t come up on this list.
Jill K DeWit:
I know.
Steven Jack Butala:
Of the friendliest.
Jill K DeWit:
And then the unhappiest states we’re West Virginia and Arkansas. I just thought that was interesting.
Steven Jack Butala:
I really question. This is so opinion subjective.
Jill K DeWit:
True.
Steven Jack Butala:
This is all.
Jill K DeWit:
Of the study, but the back to the point, so Minnesota, Tennessee, South Carolina, we were kind of half-joking, but people see them as the nicest people in the country. So maybe that’s where you want to have your mail. I don’t know. I happen to have a Tennessee; it’s funny because we have tested this, like this part of why you’re here because we’re going to fail and tell you if you need to do that or not. So I have a Tennessee address and phone number that we keep going because I started it, and I also have a Northern California one, which I don’t really use very much, but we still have it.
Steven Jack Butala:
Before we get into this show today, 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 to the Land Academy YouTube channel comment on the shows you like.
Jill K DeWit:
Aaron wrote, “I just thought this would be cool to share. It’s not my deal; I wish one day we’ll see. Jerry N. has been in the game for quite a long time, and this deal reflects a bit of that experience. This is what I call a B-R-R-R and is another great real estate strategy.” Are you going to take me to a different spot here?
Steven Jack Butala:
It’s not. Hang on; please be patient with us for a second here.
Jill K DeWit:
It’s not formally populated into our script. So my first producer and backup producer both have the same name as Jack, who happens to be sitting next to me.
Steven Jack Butala:
This is my bad. All right. Well, so listen to this deal.
Jill K DeWit:
There we go.
Steven Jack Butala:
I put this in my Jack.
Jill K DeWit:
I was trying to stall.
Steven Jack Butala:
Thank you. I put this in the Jack Thursday for a reason.
Jill K DeWit:
Okay.
Steven Jack Butala:
Because this person submitted this, it’s a buddy of theirs or a friend of theirs that’s doing this deal.
Jill K DeWit:
Okay.
Steven Jack Butala:
You’re going to love this deal, Jill.
Jill K DeWit:
So Luke wrote this.
Steven Jack Butala:
It’s B-R-R-R.
Jill K DeWit:
Okay. Got it.
Steven Jack Butala:
Buy rehab. So purchase for 1.8 million, a million-dollar rehab. You have total cost in at 2.8 million. This is a house. Refinance for 4.5 million, which is appraised value on terms of 80% loan of value 3.75 fixed rate on a 30 year of a fixed mortgage. So 3.6 million dollar loan take $800,000 cash out, 3.6 million dollar loan, 2.8 million dollar cost, and now you’re left with $16,000 pretext, principal interest taxes, and insurance PITI.
Jill K DeWit:
A month.
Steven Jack Butala:
A month. You rent the property for 12 months on a $25,000 a month lease with an option to renew for another 12 months for 30,000—five reasons why this works. You put $800,000 cash in your pocket. It’s not a taxable event, which is subject to; however, we’ll leave that out of this for a second, you have $900,000 of equity that’ll continue to go up as the market appreciates an extraordinary depreciation, right off opportunity, 80 to $90,000 a year and fantastic cash flow. A hundred thousand dollars a year, and it’ll go to 170,000 in year two. So the name of this episode is numbers. If that makes your head spin, does that make your head spin?
Jill K DeWit:
Nope.
Steven Jack Butala:
I know it doesn’t.
Jill K DeWit:
Nope.
Steven Jack Butala:
You’re the right girl for me, Jill.
Jill K DeWit:
Nope.
Steven Jack Butala:
No, I love this stuff.
Jill K DeWit:
If you can do one, you can do 10.
Steven Jack Butala:
Yeah. I mean all you need to do [foreign language 00:07:08].
Jill K DeWit:
Now you have the recipe, just do it again.
Steven Jack Butala:
So there’s a lot of discussions after, and this is in discord at Polaroid discord. And my immediate response was, we’re involved in a deal like this. Jill and I are right now. And we’re working on the second one. And the reason these work is because we’re very close to an international teaching hospital where there’s surgeons coming in and out, and they need expensive housing like this. And so it works. It works in those types of markets. There’s tons of teaching hospitals all over this country where this can work.
Jill K DeWit:
Oh, it’s true because you’re talking about doctors [crosstalk 00:07:41] that pay that rent.
Steven Jack Butala:
As a tenant.
Jill K DeWit:
That’s true.
Steven Jack Butala:
And doctors, they’re not going to ask any questions.
Jill K DeWit:
Yeah, it’s all over. You don’t realize it. You don’t realize it until you look around and do the math. That’s a great example of when you talk about in 3.0, which is being released right now.
Steven Jack Butala:
What was that? It’s like devil women came out.
Jill K DeWit:
Sorry, I had to get that in there. Atlantic academy 3.0 is here. So it’s awesome. This is stuff we talk about in 3.0, where we teach you how to troll for these areas and find these numbers. So if you want to do numbers like this, you can use Jack’s example to put in the parameters, zero in, and just kind of scroll around the country and see where rents are being, command that price, and the houses align with those figures.
Steven Jack Butala:
Today’s Jack Thursday. And this episode is called numbers. This is why you’re listening.
Jill K DeWit:
Red or Pink, what nail polish do I want?
Steven Jack Butala:
Red.
Jill K DeWit:
Red or pink?
Steven Jack Butala:
Everything starts with numbers. You should be chasing numbers. And I really mean that from my soul, this person, whoever did this real estate deal, we just talked about in the question, they had a budget, they set out to find a piece of real estate that was grossly undervalued and needed to be completely renovated to the tune of a million dollars. And with intent sought out the markets where he knew that rent would support a 23,000 to $30,000 a month rent, which is not unusual, especially in California. And again, the higher-end neighborhoods that are close to hospitals, but that didn’t happen because he was looking around, seeing what’s available. This really is a mental thing. And we are taught to look around. We’re taught to walk through Walmart and look around and see what’s available. And she was the best one throughout our whole entire lives. That’s what we’re taught to do.
Jill K DeWit:
This is brilliant.
Steven Jack Butala:
Well, I don’t agree with that.
Jill K DeWit:
You’re right.
Steven Jack Butala:
I think you should create your own market and see what you create, what’s available, not what’s on the Walmart shelf, not what’s listed on the MLS, not what’s on the car lot. And certainly not when you’re choosing a life partner or a business partner. You can create that by chasing numbers. So you start with a budget; you should spend hours and hours and hours budgeting and rebudgeting and supporting the numbers that you come up with to see if it’s realistic and then seeing if there’s a need, like in the form of a feasibility study before you ever spend a dollar.
Jill K DeWit:
Yeah, I know you’re right. It makes me think of how many people walk around even right now on Alibaba. I’m sure there’s people that are trolling Alibaba for some kind of product they can buy in bulk. And it’s like, if I only mark this up a dollar, this is what I could make. But like hold on a moment, your way is better.
Steven Jack Butala:
It all starts with setting a budget and setting those numbers, supporting it, making sure it’s realistic, and then chasing it down. And then, at the end of that, after the dust settles, you’ve done it all. And you look at what actually happened. It’s a budget to actual. And so you look at what you budgeted. You looked at what actually happened, and if it’s relatively close, you go do it again. There’s this whole notion we live in a world right now where people are fighting and trying to be accepted for who they are, which I don’t agree with. I think you should be chasing numbers.
Jill K DeWit:
I’m so sorry.
Steven Jack Butala:
And behaving.
Jill K DeWit:
I’m sure that wasn’t meant to be funny, but I just had to take.
Steven Jack Butala:
Behaving in an [crosstalk 00:11:26].
Jill K DeWit:
Hold on a second.
Steven Jack Butala:
Extraordinary manner to chase these numbers down that you’ve set for yourself.
Jill K DeWit:
Jack, I appreciate you for who you are right now today.
Steven Jack Butala:
I don’t know. Do you?
Jill K DeWit:
All of this, right here? All of this, this is the best it’s going to get.
Steven Jack Butala:
Oh my gosh, I don’t know. This is one of those times where it’s like, I’m a little afraid of Jill.
Jill K DeWit:
And you can say the same about me. This is the best it’s going to get.
Steven Jack Butala:
there’s this concept now because I think it’s partly because of the internet. I’m sure largely because of the internet that you should do stuff if you enjoy it.
Jill K DeWit:
Oh, that’s the funniest thing. That’s true.
Steven Jack Butala:
It cracks me up, that concept.
Jill K DeWit:
And if you don’t enjoy it, just follow prince Harry, you should leave. What the heck? Not the leaving thing, everyone I’m talking about the article, the whole interview about where he is like your mental health is more important than your paycheck. I’m not sure I agree with that.
Steven Jack Butala:
Yeah. I’m right there with you, Jill.
Jill K DeWit:
I think food on the table is more important first.
Steven Jack Butala:
I’m not advocating doing something you hate.
Jill K DeWit:
Correct.
Steven Jack Butala:
By any stretch.
Jill K DeWit:
Exactly, not anything bad.
Steven Jack Butala:
There’s good and bad parts to everything.
Jill K DeWit:
Yes.
Steven Jack Butala:
And if you follow the numbers that you set for yourself, however high or low they are, you’re going to outsource all the stuff you don’t like to do anyway because you have the money. So it does begin and end with numbers. Somebody in discord it was, Lori, is in Florida right now, and they’re launching satellites. SpaceX is launching satellites. And she had a whole kind of like a little bit of an emotional moment and said, Elon Musk is just a guy. He’s just a regular guy. And he’s chosen to launch stuff into space.
Jill K DeWit:
Yeah.
Steven Jack Butala:
So all we’re trying to do is make 10 or 20 million a year buying and selling land. So compared to SpaceX, it’s nothing.
Jill K DeWit:
This is really safe.
Steven Jack Butala:
It’s tiny.
Jill K DeWit:
Talk about playing it safe.
Steven Jack Butala:
Exactly, Jill.
Jill K DeWit:
Yeah. I’m going to quietly make a couple million bucks a year. I’m not launching anything. Happy you could join us today. Five days a week, you can find us here on the Land Academy Show.
Steven Jack Butala:
Tomorrow is Jill Friday. And she’s going to talk about female land investors unite.
Jill K DeWit:
That’s right. Say that again. Three times fast.
Steven Jack Butala:
Female land investors unite.
Jill K DeWit:
There we go.
Steven Jack Butala:
You are not alone in your real estate ambition.
Jill K DeWit:
That’s good to make it.
Steven Jack Butala:
I have some stuff to say about this women’s group too.
Jill K DeWit:
Oh, okay. I would like to hear what you have to say.
Steven Jack Butala:
Mm-hmm (affirmative). Maybe not.
Jill K DeWit:
Maybe not. Maybe. You know what? Maybe instead of the happiest and the unhappiest state, we can talk about the happiest and the unhappiest home. Depending on what you have to say tomorrow. Because right now it’s the happiest, that good change. Thanks for tuning in. We hope you find our content of valuable. And we really do appreciate your support. If you haven’t already, check out our YouTube or any other place that we’re around, hit the subscribe button, follow us, leave us notes. We love it.
Steven Jack Butala:
We are Steve and Jill [crosstalk 00:14:46].
Jill K DeWit:
We are Steve and Jill.
Steven Jack Butala:
Information.
Jill K DeWit:
And inspiration.
Steven Jack Butala:
To buy undervalued property.
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