Six Steps to Getting Your First Land Deal Complete (LA 1733)
Six Steps to Getting Your First Land Deal Complete (LA 1733)
Transcript:
Steven Jack Butala:
Steven Jack Butala here.
Jill K DeWit:
And Jill DeWit here.
Steven Jack Butala:
Welcome to the Land Academy Show, entertaining land investment talk. Oh, I already said it. I’m Steven Jack Butala.
Jill K DeWit:
That’s okay. And I’m Jill DeWit, broadcasting from the valley of the sun.
Steven Jack Butala:
Today, Jill and I are talk about the six steps to getting your first land deal complete. Super popular question. We just got done, Jill and I, wrapping up the most recent Career Path, I guess it was Career Path number three.
Jill K DeWit:
Yep.
Steven Jack Butala:
And we always follow this format throughout Career Path and we leave no detail out. So I figured we’d just do a short summary here about how to get a deal done.
Jill K DeWit:
That’s great. Can I pause for a second and just let everybody know, since you mentioned Career Path, that Career Path number four is open. And by the time this airs, I believe I’m still going to have some seats. So if you are interested, go check out landacademy/careerpath, and you’ll find out all the details there about what it is, what we’re talking about. It’s basically, Land Academy is like a self-study program. This is the opposite of that. If you want to really talk to us and dive in and have discussions and ask questions throughout the whole process and then find out what we’re working on right now today, that’s Career Path.
Steven Jack Butala:
Well, if you want this to be your career, then Career Path, buying, selling land is your career, then you should consider Career Path. Whether you’re brand new or you’ve done 180 deals.
Jill K DeWit:
And you retired from something else.
Steven Jack Butala:
Sure.
Jill K DeWit:
Or done, you know, there’s everything in there. Cool.
Steven Jack Butala:
Before we get into it, let’s take a question posted by one of our members on landinvestors.com online community is free. And did you know that Jill and I personally.
Jill K DeWit:
We just answered that.
Steven Jack Butala:
Oh, you’re fast.
Jill K DeWit:
You can skip that part. Hey, by the way, I want to apologize real quick here. Before I read this question, I may not sound like myself.
Steven Jack Butala:
Jill’s been working. This month, for some reason, we have bought and sold a ton of property. And Jill’s been on the phone-
Jill K DeWit:
For some reason.
Steven Jack Butala:
Selling.
Jill K DeWit:
How about, I’m doing a good job. What do you mean for whatever reason?
Steven Jack Butala:
Well, because Land Academy works. And we sent a lot of mail out and we’re buying and selling property. That’s what I mean.
Jill K DeWit:
For some reason, that’s hilarious.
Steven Jack Butala:
Michael asks.
Jill K DeWit:
All right. Michael wrote, do you send mail to properties in a flood plain or do you exclude flood plain properties in DataTree?
Steven Jack Butala:
Great question. You cannot exclude properties that are in a flood plain in DataTree or any other assessor data set. Here’s the deal. Here’s a real big picture question here. The issue is assessors collect data about properties that’s important to them so that they can report that data to a treasurer who assigns a property tax amount. And for whatever reason, for better or for worse, properties that are in flood plains, don’t matter to them. And so we can’t capture a data set. In the future, we might capture a data set on that, but you can’t exclude or include that for some reason. You know, some of the things that are really important to assessors are, is there a structure on it? Is it improved? Is it a vacant piece of property or does it have a house on it or does it have an office building on it or a hospital? So those are the way that they assess taxes.
Jill K DeWit:
I have-
Steven Jack Butala:
You don’t have to raise your hand. I don’t know when, that’s just hilarious.
Jill K DeWit:
Okay.
Steven Jack Butala:
We’re partners.
Jill K DeWit:
Well, I just didn’t want you to go onto it without letting me talk for a second. I’m pretty sure that this is going to happen in the not too distant future. Because even right now with NeighborScoop, we can look and then we have a FEMA flood map overlay, and we have all kinds of different layers that we can look at on these properties. So there’s probably going to be a way that even though it doesn’t come from the assessor data, you can run it through something before you send your mail out.
The thing that it’s not going to pick up is, you shouldn’t do that anyway. Because so many properties, please go in NeighborScoop or whatever you are using and pull up a flood map. And please look at Phoenix, for example. The whole flipping city is in a flood plain, and we are all building houses. So there’s all kinds of, even though proper’s in the flood plain doesn’t mean you necessarily can’t build there. So sometimes you just have to raise foundations or do different things with drainage, whatever. So I’m just saying, I wouldn’t want to exclude those anyway.
Steven Jack Butala:
Yeah. What Jill’s saying is you never want to really make your mailer smaller.
Jill K DeWit:
Yeah. Don’t take it out.
Steven Jack Butala:
There’s stuff that you should exclude and we teach all this in Career Path and all the education programs that we have. There’s stuff that you exclude, very clearly exclude, in my opinion and stuff that you just, eh. You don’t want to get up in the morning, go fishing in a lake, in a small lake in let’s say the Midwest and use a lure that’s designed to catch a sea tuna. And that’s what making these mailers smaller are. You want to cast a net and just see what you catch.
Jill K DeWit:
I think everybody’s looking for an easy button.
Steven Jack Butala:
Yeah, there’s no easy button.
Jill K DeWit:
It’s going to be perfect.
Steven Jack Butala:
Nope.
Jill K DeWit:
And if you are relying on an easy button, you’re going to miss a lot of good properties.
Steven Jack Butala:
Believe me. Jill’s right.
Jill K DeWit:
And you won’t be my competition because I’m going to be buying them all.
Steven Jack Butala:
If you sent a mailer out in Phoenix or in a lot of places in Arizona or in a lot of parts of the desert and had the opportunity or the option to exclude flood plain properties, you would send no mail out. And that doesn’t mean that it’s in a flood plain. It just means that there’s there’s FEMA, it’s just not, you need to really look at it.
Jill K DeWit:
Exactly. Wait till it comes back, do your due diligence and then decide.
Steven Jack Butala:
Let me put this another way, make it real simple.
Jill K DeWit:
We’re going to hit this home, Michael.
Steven Jack Butala:
In Land Academy 3.0, do exactly what Jill and I say. Exactly. And if we don’t bring up flood plains, it’s because in 35 years it hasn’t been necessary and it’s not necessary now. So if you just follow the program, you’re going to do great. Today’s topic, six steps to getting your first land deal complete. This is the meat of the show. What’s the very first step in anything if you want to have success, Jill?
Jill K DeWit:
Take out a loan. People start there all the time.
Steven Jack Butala:
Please don’t take out a loan.
Jill K DeWit:
Like I know, what the heck is that? Don’t borrow any money.
Steven Jack Butala:
Here’s some dad advice. Do not take a loan out-
Jill K DeWit:
Work on my credit score.
Steven Jack Butala:
… for anything except a house. And it better be cheap. The house better be cheap in the first place. Or in some cases, not all cases, education. And that’s it. That’s the only two things you should ever take a loan out in your entire life. Or commercial property, if that’s what you do. asset based loans are fine. Number one, step one, you need to get educated and you should not take a loan out to do that. Because when I say potentially get an education loan, if you’re smart enough to go to some Ivy league school and it costs two or three or $400,000 to get in and out of there, you might need a loan. And it might be a really good idea to do that.
Jill K DeWit:
I would only do if I have absolutely have to.
Steven Jack Butala:
Me too. I actually would probably work my way through it no matter how much it costs. So step one is get educated. And there’s so much free content out there. This podcast is a great example of free content. There’s three or four or five real credible people on the internet, or acceptable groups that teach about by and selling land on the internet, and just soak up as much free content as you possibly can and before you ever spend a dollar. If you’re into it and you find yourself waking up obsessed with it, like us, then start spending some money on education and pick and choose which groups you think are like your personality. I’ll tell you, honestly, Land Academy, I’ve been told this and we never intended that this would be that, but I’ve been told that Land Academy is for people who want to make this their career and they’re real serious about it.
Jill K DeWit:
Yeah. We have a lot of people that come to us from other groups that started there, got their feet wet and then like, okay, now I’m ready to make this a thing. And then they come here and it works out great. So, cool.
Steven Jack Butala:
If this is your hobby and that’s all you ever want it to be and you really love your job, your W-2 job, this might not be the best thing for you.
Jill K DeWit:
Well, we get people that do that too.
Steven Jack Butala:
Okay. Step two. Choose a place to send mail. We’re all about direct mail and sending out blind offers, tens of thousands of offers, to see who’s going to sign it and send it back. You need to choose the right place. Northern Alaska might not be the best place to do this. Southwestern Texas, I can tell you for sure is not the best place to do this. Well, that’s great Jack. Then what’s the best place to send it? In our education-
Jill K DeWit:
He’s so sweet. He’s covering for me right now. So he’s having his own conversation. I’ll be over here. I’ll just make gestures, you know, like, yeah, good.
Steven Jack Butala:
[inaudible 00:09:09] can’t talk. It’s a positive and a negative thing for me, but largely positive.
Jill K DeWit:
Oh, thanks a lot.
Steven Jack Butala:
There’s a way that we teach in Land Academy about how to, we call it trolling the internet or trolling in Zillow or Realtor or Redfin. Trolling areas to identify places to send mail. And then testing them through what we call a red, green, yellow test to see if it’s the statistics and it’s all really checking up. And so we don’t guess about where to send mail. So number two is choose a place to send mail, but do it through data. How we teach or whoever, just honestly, our way is the best. Just being real honest. Number three, get the offer campaign in the mail. If you find two or three or five zip codes, maybe they’re adjacent, maybe they’re in different states, that work, they pass the red, red, green, yellow tests, you feel very confident, put them all together in a mailer or a call. Offers to owners, the number two, and look up Concierge Data.
They’ll do all of it for you, if you don’t want to do it. But get it in the mail. Nothing’s going to happen. You will never get to the end of your first deal, which is what this is all about, this episode. Nothing’s going to happen if you don’t get it in the mail. Some broker’s not going to call you or some wholesaler’s not going to call you. They might and say, hey, I got a great deal, but it’s not a great deal because you didn’t get there first. That’s what sending this mail is all about. You got there first. You’re talking to the seller and they want to sell it to you for the price that you think makes the deal work.
Jill K DeWit:
You know, it’s kind of funny. I was just thinking, I pointed out to Jack the other day in the newspaper, our little community newspaper, there’s a guy in there selling his house and it’s flat out for sale by owner. And the bottom says, agents, please don’t call. And I love it.
Steven Jack Butala:
At least he said please.
Jill K DeWit:
He is like, the please may or may not have been in there. But I thought it was really kind of cool that there’s a lot of sellers that don’t want to work. They love this. They love working just with us. When you’re talking to these people and you say I’m the owner and whatever you and I deal you and I make, that’s it. They’re like, oh whew, thank you. You took all the whatever out of it. It’s nice not to have a middle man and go through that. So these guys love talking to us, these sellers.
Steven Jack Butala:
So number three, you get the mail out. Number four, after a couple weeks when that mail’s out there, you’re going to have to answer the phone or get somebody, get a call service to answer the phone. You know, if you cast a fishing line in the water and a fish jumps on and you can feel it at the end of the rod, and you don’t reel it up, that’s crazy. You went all through the work and hopefully it’s fun to get out there and fish that day. And if you got something on the line, reel it in. See if it’s big or small or what.
Jill K DeWit:
You have a lot of fishing stories. Are you trying to tell me something?
Steven Jack Butala:
Actually, you know what? You know why?
Jill K DeWit:
Why with all the fishing stories?
Steven Jack Butala:
I’ve been thinking about fishing so much lately because I haven’t done it. And it’s like the season’s starting to change. It’s going to get hot. I missed the whole season.
Jill K DeWit:
I’m sorry. Darn it.
Steven Jack Butala:
So you answered the phone and you found out that because you sent out 5,000 offers and you talked to maybe 15 people or PATLive or something or maybe in the near future here JillLive, answer the phone, and you found out that five of these properties probably work for you. Well, you pick the ones that work. You talk to 15 people, maybe five or six work. Then you really get into it and find out that maybe three work of these, maybe two or three, maybe 20, on these 5,000 unit mailers that you sent out work. So you pick the ones at work through due diligence. And again, we teach all of this stuff. This is step five. Step six.
Jill K DeWit:
By the way, let me back up real quick here. In step five when you’re doing your due diligence, picking the deal, that’s when you’re checking flood plain. Just want to throw that in there. Seriously.
Steven Jack Butala:
Yeah. Not at the beginning.
Jill K DeWit:
Yeah. Don’t worry about that.
Steven Jack Butala:
Not in your mailer.
Jill K DeWit:
So think about this. I’m sending out five or 10,000 offers. Am I going to sit and figure out flood plain then? No. I can do that real quick when they call back and I’m talking to 10 or 20 sellers. That’s when I get serious about it.
Steven Jack Butala:
Jill’s right. You want to check the flood plain on 5,000 properties? Or do you want to check it on 15 at the end? Just 15.
Jill K DeWit:
Yes.
Steven Jack Butala:
So you’re going to pick the deals at work. That’s step five. And step six is you buy it. You work through an escrow agent in most cases to buy the property and then you sell it for more, usually by enlisting a real estate agent. That’s how we do it. A vetted local, cowboy hat, land agent who knows the market and understands you and understands land and doesn’t sell houses.
Jill K DeWit:
That’s funny. Speaking of which, one of our land guys locally here, selling some stuff for us, sent me a note in social media like, hey, that picture I posted last week on Facebook, that was standing on your property. Isn’t that cool? He’s that into land.
Steven Jack Butala:
That is fantastic.
Jill K DeWit:
It was really cool. So, yeah.
Steven Jack Butala:
How great is that?
Jill K DeWit:
Totally.
Steven Jack Butala:
Was it on the buy side or the sell side?
Jill K DeWit:
He’s selling it for us. Yep. It’s awesome. 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 on the Land Academy Show is called the three types of land investment deal buckets. We’ve divided all the properties that Jill and I buy into three types of property. And surprise surprise, the third one makes the most and the first one makes the least. You are not alone in your real estate ambition. How bad is your voice? How bad does it hurt? You sound great. I’m serious. I’m serious. I’m not being [inaudible 00:15:01].
Jill K DeWit:
It sounds like I had like a rough, rough, I don’t know what, but yeah. Thank you. It’s actually better. I am 90%. I don’t sound 90 percent, but trust me, I’m 90% there.
Steven Jack Butala:
If you listen to the show or watch the show, you know that last week were reruns because Jill just couldn’t talk.
Jill K DeWit:
I know, I’m sorry.
Steven Jack Butala:
But it was worth it because we bought and sold a ton of property this month.
Jill K DeWit:
Thank you. And thanks for tuning in. Hey, by the way, case you didn’t know, we recently released our newest and latest up to date educational program for Land Academy. It’s called Land Academy 3.0, Catching Up With Land Academy. We spent six months writing, creating, producing this program and it’s all the latest tools and things that we use now to help you succeed at buying and selling land. It’s about five hours of how to video and it’s screenshots, getting in there, and it’s free to existing members and available to you. Check out landacademy.com or you can call. Actually best is email, support@landacademy.com.
Steven and Jill:
We are Jack and Jill.
Steven Jack Butala:
Information-
Jill K DeWit:
And inspiration-
Steven Jack Butala:
To buy undervalued property.
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