Why Smart People Understand the Land Investment Business Model (LA 1732) RERUN
Why Smart People Understand the Land Investment Business Model (LA 1732) RERUN
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 Dewitt, broadcasting from sunny Southern California.
Steven Butala:
Today Jill and I talk about why smart people understand the land and business model, and maybe why some un-smart people don’t.
Jill DeWit:
Un-smart… Smart-less.
Steven Butala:
Like all these topics, there’s something going on below the surface. I know what it is. 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:
Greg wrote, “I’m buying blocks of lots out West, but the acres and the dimensions on the plat map don’t seem to match up with ParcelFact, and Parlay 2.0 specifically. One dimension of lots is 165 feet on the plat, while as best I can measure, is 145 feet, according to both ParcelFact and Parlay 2.0. The total acres the County references seems to match the online data, shorter domain dimension, lower acreage, but not on the original plat. Which is more likely to be correct? That’s a you, all day long.
Steven Butala:
You ever see the Rain Man?
Jill DeWit:
I have. Dustin Hoffman? Tom Cruise?
Steven Butala:
And how chronic his OCD was? We love Greg, and I don’t know Greg, but I love Greg’s question here, but I’ll tell you, these are satellite images that are lined up with manual GPS coordinates that are coming from a database. Imagine GPS coordinates and a corner point of a piece of property that’s not a square, it’s all kind of a polygon with 22 points. That data set’s literally got 22 data points for each of the, not the corners, but the edges, even. Multiply that, times 150 million properties in the country, then, technically think about the image, this is 10 feet off for Greg, the image is coming from space.
Jill DeWit:
Can I add, throw in there the curvature of the earth.
Steven Butala:
Yes.
Jill DeWit:
Which is reality. Thank you.
Steven Butala:
The image is coming from space, and not just one satellite. Very often the satellite images are overlapping each other and they’re not perfect. So, what’s going on with this question is, it’s not perfect, and it’s never going to be perfect. If you want a perfect survey, you have to order one, and the guys come out with the orange coats on and devices, and they tell you exactly what your lot dimensions are. And even then, there’s a plus or minus margin of error. You can’t overlay.
Steven Butala:
I’m extremely confident that the ParcelFact dataset from which you see the data on your screen, and the Parlay dataset are identical. How it’s getting presented, we use S-Ray. Jill and I own ParcelFact. Parlay is another, I know those guys and they’re great guys, and they have a great product. They’re also the makers of LandGlide. The products are all coming from the same dataset, and while our presentations are different, the data behind them are the same.
Steven Butala:
Here’s my big picture point. Who cares? It’s a few feet off. You understand the boundaries. If you’re going to build a road, you need a survey. If you’re going to build a house, you need a survey. If you’re going to get financing, you’re going to need an in-person survey. I’m not knocking you, Greg, at all. In fact, I bet you a dollar you’re either an engineer or an accountant. I’m an accountant, so I can say this stuff. Accountants and engineers are in a different planet. It’s like the Rain Man. If the light says, “Don’t walk,” and you’re in the middle of the street, you stop walking. But in the real world, that’s a great way to die.
Steven Butala:
Is this 20 feet to stop you from buying this property?
Jill DeWit:
That’s hilarious. Do you know what’s funny though?You brought up a good point that even the guys that go out there, they’re doing the best that they can. Everybody’s doing the best that they can. You think every title policy you buy is perfect, and foolproof, and they didn’t miss anything? Well, you haven’t done enough deals, do 10, one of them will be messed up. No, I shouldn’t say that, not 10, but stuff happens. People make mistakes.
Steven Butala:
I think that’s a good number. Honestly, at best. Along those same lines, in what Jill is saying, I just got done researching, because we’re in this weird mortgage forbearance thing, that more than 40% of the mortgages in this country are calculated incorrectly.
Jill DeWit:
That breaks my heart.
Steven Butala:
If you’re a person who’s sitting around saying, most people are like, “Oh, I got six months to pay off my mortgage.” I think, I wonder if you paid it off a year ago, because of two decimal points on the interest rate.
Jill DeWit:
Oh, I see what you are saying.
Steven Butala:
It’s tragic.
Jill DeWit:
That’s true, most people look at that schedule and they don’t double check the math.
Steven Butala:
They don’t check anything.
Jill DeWit:
They’re like, “It looks okay.” It said a hundred and however many months, whatever the number is, I guess that’s right.
Steven Butala:
So to answer your question, Greg, which one is more likely to be correct? You decide.
Jill DeWit:
Whichever one you pick.
Steven Butala:
Look, all kidding aside, it shouldn’t stop you from buying the property.
Jill DeWit:
True.
Steven Butala:
Just about every single overlay that I look at, regardless of the source, it’s not lined up with the actual real estate. What you’re talking about is the boundary lines on everything, and it’s off. We just spent a fortune on some properties in California where the stuff’s so far off, it makes me laugh, but I know for sure the roads going through it.
Jill DeWit:
It’s okay.
Steven Butala:
Today’s topic. Why smart people understand the land investment business, and why some don’t. This is the meat of the show.
Jill DeWit:
It’s not just the business, it’s our whole model. I think this is really good. Smart people understand this, and I hate to say that if you don’t, you’re not smart. That’s not what we’re trying to say. I just think it’s interesting that this is a tricky… for some reason, it’s confusing. It started with me, when I first tried to share with somebody else what I was doing. I came along with you, we united, in many ways outside of business…
Steven Butala:
That gets you thinking.
Jill DeWit:
You pulled me in to this world, and I’m like, “I got this.” I didn’t even think twice about it. It made complete sense to me, absolutely made sense to me. I saw buying this property, doing nothing to it, and reselling it for more, as easy. I don’t think it’s any different than ordering products in mass amounts, like, say water bottles. Like the kids on the beach, selling water bottles for a dollar each, or wherever you are. I see it like the same thing. I buy it cheaper, I add a little to it, and then here you go, I provide it, now it’s way more convenient coming from me. That’s kind of how I see our business model.
Jill DeWit:
But most people, I just think, we were always told that from little kids on up, that you have to do something to add money to it. You have to take a house, for example, if I bought a house today, I need to remodel the kitchen, finish the garage, stage it, whatever, all those things have to be done in order to turn a profit. And that’s really not what’s going on here.
Steven Butala:
Jill and I are very, very fortunate. We timed our business and our life, and actually Land Academy, during the period of growth in the internet where it made sense, meaning this, people find us. People go onto Google, or wherever, or listen to a podcast, and the light bulb either goes off, and they say, “Wow, buying and selling land makes a lot of sense to me.” And they find us, and then a very predictable percentage of those people, or a number of those people actually join. Then they’re in it, again like Tiffany Carter, if you listened to her story on Monday, it’s very similar to that. She tried to do it on her own, didn’t understand, she had a little bit of success. Then she went on the internet, joined some other groups, did theirs, there was holes. Ultimately she found us, filled the gaps, now she’s making a ton of dough. She’s having fun doing it, her whole family’s involved, you should listen to the interview.
Steven Butala:
So people find us, and they’re the right people. If you’ve ever talked to a college professor who has ever taught in high school or anything, they’ll say some version of, “Wow, what a refreshing change to teach college because people actually to be here.” So imagine if I stood on a corner in New York City and put a cardboard box on and said Land Academy, with a bell. How many people? I’d be dead in two days. The average person doesn’t care about this. My point is this, the underlying situation here is, when you put a bunch of people on a city block from everywhere, all walks of life, all countries, all interests, all education levels, it’s going to be a disaster. It’s only a matter of time before it’s just a disaster.
Jill DeWit:
Why do you say this? Because they can’t all agree on something?
Steven Butala:
Because it’s completely different interests, and they have completely different education backgrounds, and I don’t mean formal education, I just mean like growing up in different places and stuff. Smart people, this may not be the best title for this, smart people understand this land investment model because they innately are interested in it and find us, not we go out and find them.
Jill DeWit:
And they happen to be smart?
Steven Butala:
Interestingly enough, that’s how we buy land. We send out seven bajillion offers, and they find us. They come back and find us. We send out seven bajillion signals on the internet, and the small percentage of people that are interested, come back and find us. It turns out those people usually are smart. The ones that we do attract and they get into it, and we talked about this yesterday, find out that there’s about 20 moving parts to this, are either too lazy or it just doesn’t compute, that if you deconstruct those little parts, you can be extremely successful pretty quickly, and be a part, which I love, be a part of a small group of people that understand each other, and can grow together.
Jill DeWit:
That’s the best part for me.
Steven Butala:
We’ve all heard of birds of a feather.
Jill DeWit:
Exactly. Well, then all my notes don’t apply.
Steven Butala:
Why? Of course they do.
Jill DeWit:
Well, I was thinking of this differently. I thought that you-
Steven Butala:
Well, tell us, love, because your perception is awesome, usually.
Jill DeWit:
Well, again, we clearly do not rehearse anything before we do these. We just take the topic, go off for just a few minutes before each show and come back and here we are discussing it. My thing was, I thought it was interesting, you said smart people. I thought you were going to be touching on how interesting our community is. We have such a varied group of people, but it’s shocking to me how many of them come from, probably just because of an analytic nature of what we do, there are a lot of tech people. We’ve got people with PhDs. We got top executives, from past lives, here in our world, and it’s easy. It’s very easy for them to understand this and go, “Oh, okay, I got this. Scrub data, on it, got it. I know what I’m doing.” Others, it’s not that you can’t do it, but there’s some people that it takes them a minute, but they get it. That’s why we’re here, and we help, we help everybody.
Steven Butala:
Absolutely, Jill, I mean, we’re, in a different way, saying the same thing. Yeah, we have a very diverse group, which is great, but we do have one thing in common. We all want to buy and sell land and make some money.
Jill DeWit:
That’s true.
Steven Butala:
Or we want to send out letters to some type of real estate product and make some dough on it.
Jill DeWit:
That’s very true.
Steven Butala:
The same way, if you imagine any type of worshiping environment, people are all there, they might be completely different and have completely different jobs in all walks of life, but they all believe in this one thing, they’re all there on Sunday. So, that’s my point, is it takes one or two things in common, you can come from the most diverse background on the planet, as long as you have one or two things in common, and that’s what I love about this group. I mean, hopefully we’re saying the same thing, but just in a different way.
Jill DeWit:
Yeah. The value is, too, everybody brings something different to the table. Was it, not today, but it was this week, I think we asked the question about accountability groups. One of the beauty too, of getting into these smaller accountability groups that we’re working on, or just being in a small community, is you each bring something different to table, and as partners, we each bring something different to the table. That’s it. That’s something to think about too.
Steven Butala:
I’m sure there’s a learning how to paint watercolors version of Land Academy out there. I’m not going to seek that out, and I’m not going to be part of that group, but I love those watercolors people.
Jill DeWit:
No, you’re part of the “how to take apart your VW engine group.”
Steven Butala:
Yes, that’s true.
Jill DeWit:
And I’m a part… shucks, what am I a part of? I’m trying to think here, right now, it’s throwing a chick party, one-on-one group.
Steven Butala:
Well, it’s not one-on-one sweetheart. This is like, 808.
Jill DeWit:
Okay. Throwing a bash for all your friends.
Steven Butala:
This is what happened. During the COVID, Jill’s girlfriends, this large group of women in our little beach community, it’s getting larger now, the group. One person decided girls only, women only, party. It’s like six parties ago, so everything just keeps going from house to house every other weekend now. This weekend is our-
Jill DeWit:
Is our house.
Steven Butala:
It’s not ours. It’s Jill’s, I have to go get a hotel or something.
Jill DeWit:
Yeah, you won’t be here. It’s only girls, that’s true. Exactly. Happy you could join us today. You can find us right here, five days a week on the Land Academy Show.
Steven Butala:
Tomorrow the episode on the Land Academy show is called “problems we solve for certain seller types, you are not alone in your real estate ambition.”
Steven Butala:
Another thing Tiffany said on Monday was, and I think we brought it up and she agreed, “All the great deals that we do are solving a problem for the seller.” We’ll cover those problems tomorrow, but it all ends in a big hug for Jill, “Hey, thanks for the money. You really saw my problem here. I didn’t want to do, fill in the blank, you guys did it for me.”
Jill DeWit:
Exactly. Thank you for tuning in. We hope you find our content valuable and we appreciate your support. If you haven’t already, please get on over to our YouTube channel and hit the subscribe button.
Steven Butala:
And your comments and suggestions help us to create the type of content you’re here for. Hitting the like button on your favorite episodes helps us to support our channels algorithm, and gauge your interests in future shows.
Jill DeWit:
We are Steve and Jill.
Steven Butala:
Information-
Jill DeWit:
and inspiration-
Steven Butala:
to buy undervalued property.
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