How to Overcome buying Land You Never Visit (LA 1750)
How to Overcome buying Land You Never Visit (LA 1750)
Transcript:
Steven Jack Butala:
Jack and Jill here.
Jill K DeWit:
Hi.
Steven Jack Butala:
Welcome to the Land Academy Show, entertaining real estate 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, Jill and I talk about how to overcome buying land that you’ve never seen in person. I’m going to start with a little anecdote, if it’s okay with you.
Jill K DeWit:
Sure.
Steven Jack Butala:
Jill and I are car people, and we’re always looking for some car that’s been in our soul forever, this is how I like to describe it, separately. This not something that we ever had or developed together. I think since we were little kids, we’re car people.
Jill K DeWit:
Yes.
Steven Jack Butala:
And so, as you know, like anything online, these are rare cars. When they come up and they’re the color you want, and they we have the engine you want and all that stuff, you got to make a decision quick. And it’s never my first choice to buy a car, especially without seeing it. So recently, I bought an old Corvette that’s been on my list for quite some time, and I took delivery on it, and I had this thought, if I saw this car in person, I would’ve paid to twice as much as I actually paid.
Steven Jack Butala:
Patted myself on the back, but when in reality, I didn’t do anything. It was just luck. Jill had the same experience with the Supra car recently when we took delivery on it. I tried to find a scratch on that car, and whoever owned that just babied it. So, the opposite is true with an old Volkswagen bus I bought. I did go to see that, luckily, and we ended up buying it for half of what the person was asking because it was just too banged up. And so the same applies to land. I can tell you that every single piece of land that I have ever gone to see, I would’ve paid more for.
Jill K DeWit:
Mm-hmm (affirmative). Yep. I understand.
Steven Jack Butala:
I don’t want to steal your thunder. I don’t know what you’re going to talk… This is Jill’s show today.
Jill K DeWit:
I’ve got-
Steven Jack Butala:
I want to hear this too.
Jill K DeWit:
We’ll talk about that.
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 I got to tell you, last year, a ton of Land Academy members came to Jill and I, needing extra help getting their blind offer campaigns in the mail. Getting the mail out is a tough thing for some people, and I get it. It was tough for me the first few times I did it, too. So I took a look at how we were personally sending mail out, with our key employees, and who does the stuff for me personally in our mailers, and we decided to create a product called Concierge Data Plus. It’s a year later, and hundreds of members are using it. Go to the offers2owners, the number two, owners.com, click on Concierge Data, and see if it’s for you.
Jill K DeWit:
Ross wrote, “I just sold a property for $49,000 that was in a flood plain, and I made $30,800 on it after commissions and fees. Nearly didn’t buy it because of the flood plain, and ended up price dropping the original offer down $20,000, to a purchase price of $12,500, and was willing to walk away if the seller didn’t like this offer.”
Steven Jack Butala:
I love this.
Jill K DeWit:
“Only after that did I contact a land agent that I have a great relationship with on the ground in that area, and they said the area was hotter than I thought, and that the flood plain would lower the sale price, but it would still sell fast, regardless. Didn’t even know what I had, and that blind confidence allowed for the biggest price drop I’ve accomplished to date”.
Steven Jack Butala:
On the buy side.
Jill K DeWit:
On the buy side, the purchase price. Yep. “Got lucky with that one. Full price offer within days of listing it, watch out for the hidden gems.” Isn’t that great? Sometimes that’s a way to solve some problems, which is, look, I think you go through the six A’s, and I’m going to talk about that here in just a minute. I go through all the different things that as far as my due diligence, and I’m not sure about this one. Will money solve it? Yeah, it will. So here’s the deal. I don’t like it at $20,000, but I love it at $12,500.
Jill K DeWit:
So you call the seller back and say, “I’ve got some issues. I don’t want to offend you, but because of this, I’m nervous about the property. The only number that makes sense to me that I really will buy it is $12,500. If that’s great, I’ll get it done now. If it doesn’t, I totally understand, and I wish you all the best.” And watch what happens. This person said, “Fine, I’ll take your 12,500.” But you just have to be sure when you go into it, we call it trying to kill your own deal. It’s a number that if they say yes, I’m buying it, because I know no matter what, I will be fine. So it worked out great.
Steven Jack Butala:
The variable in this story is this Land Academy member was smart enough to pull in a local area expert on the ground, as they say, their words, not mine, who confirmed, “Hey, I can sell this quickly.” So like the saying goes, you’re not alone in this. You have all of us. You have the Land Academy members, you have the Thursday calls, you have, “Would you do this deal” On Discord. And then when you’ve got everybody saying, “Yeah, this is a pretty good deal,” and then you’ve got somebody on the ground who’s going to sell it for you, telling you, “Oh yeah, this is a good deal, regardless of this, this, and this,” now I’ve got just crazy buying confidence.
Jill K DeWit:
Exactly.
Steven Jack Butala:
And so whoever’s buying and selling real estate out there, make sure you’ve got an expert, somebody who’s smarter than you in the area. If you’re unsure about whether or not you should ever buy a piece of property, get that confidence from somebody who’s an expert in the area.
Jill K DeWit:
Yep. Perfect.
Steven Jack Butala:
Today’s topic is How to Overcome Buying Land if You’ve Never Seen It. This is the meat of the show.
Jill K DeWit:
This comes up now and then, and I understand. Actually, I don’t understand, but I’m going to try to understand.
Steven Jack Butala:
Still salty.
Jill K DeWit:
See how this happened?
Steven Jack Butala:
This is pure entertainment for me.
Jill K DeWit:
Like you said at the beginning, you know what? There’s a lot of people, including the last vehicle that we just purchased… Let me back up. I don’t know, are we crazy, or trusting, or smart? Or a little bit of all of it-
Steven Jack Butala:
Not smart, it’s just luck. Crazy, trusting, and lucky, not smart.
Jill K DeWit:
You’re like, “The last two vehicles could have gone differently.” Now, let me back up. The vehicle you bought I do believe in, because it came from a trusted source that we have bought and sold other vehicles through in the past, and they are good. They’re really reliable, we have a track record with them. We know them, we know where we’re wiring the money, it’s not going to some random wherever.
Steven Jack Butala:
You’re right.
Jill K DeWit:
So that part we knew going into it. We didn’t know the vehicle, but we trusted the vehicle. We trusted the history, we trusted all the stuff that came with the vehicle, and you’re right, what came back, your car’s worth way more than I think what you spent on it.
Steven Jack Butala:
Yeah, me too.
Jill K DeWit:
It came back with a notebook, and I don’t know how many-
Steven Jack Butala:
The trophies.
Jill K DeWit:
… trophies are in there?
Steven Jack Butala:
Probably 12 trophies.
Jill K DeWit:
Yeah. We’re going to have to make extra shelves in the garage-
Steven Jack Butala:
Original parts, and all kinds of stuff.
Jill K DeWit:
I know when you’re done, on Get Smart they had this Cone of Silence, I know over our garage, there’s going to be a nice glass cone that’s lowered over your car so no air can get in there-
Steven Jack Butala:
It might happen.
Jill K DeWit:
… Or dust. Exactly. I know that’s what’s going to happen.
Steven Jack Butala:
It’s funny to do that with a car that’s older than I am.
Jill K DeWit:
I know.
Steven Jack Butala:
God knows what’s gone on in that car before it got into our garage.
Jill K DeWit:
Oh my goodness. Yeah, exactly. You’re not the first one to burn the back tires off of that car.
Steven Jack Butala:
Yeah, or worse. How many people got pregnant in that car?
Jill K DeWit:
Oh gosh. It’s interesting that we are good at that. So I guess I say understand, I don’t understand, because we do our homework. We know how to do our homework, and you just make a decision. And my car, it could have gone sideways. What’s funny is I bought it through a broker, but I still didn’t even know this broker. I had to do a little recon on the broker, and even some of our friends were like, “You guys have never met this person that’s just wiring you this much cash?”
Steven Jack Butala:
Well, the bank shut us down too, with that kind of wire transfer.
Jill K DeWit:
I had to walk in and throw a fit to say, “It’s my money, I’m telling you where I want it to go. It’s on me, not you.” So anyway, we got it done. For some people, not us, it’s obviously hard to imagine spending money on something, even as an investor, that you’ve never seen. And sometimes too, I want to throw something at you too, like Steven said, sometimes it’s better that you don’t go see it, because this is a little side note, you might fall in love with it.
Steven Jack Butala:
Yep.
Jill K DeWit:
Sometimes it’s better than you think it is, and you don’t want to sell it, and it might skew your decision. So what do you do?
Steven Jack Butala:
By the way, these cars that we bought, they’ll be gone in 24 months. Trust me. That’s just how Jill and I-
Jill K DeWit:
Oh, not me.
Steven Jack Butala:
… Because we’re in the honeymoon stage right now-
Jill K DeWit:
Oh. I don’t know.
Steven Jack Butala:
… But the minute I get a double your price offer, I’m selling it, and then I’ll be onto the next mission.
Jill K DeWit:
Sucks. I don’t know if I can do that with this car, because they’re not making anymore.
Steven Jack Butala:
Yeah. Jill’s car might be different.
Jill K DeWit:
Yeah. I don’t know. Tough one on that one. But the big picture is, okay, we understand both sides. Hard for some, I see why going to see it could make a mess too. You might get emotional about it, and then not make a good decision. So what do you do? You trust that you know the six things that you need to do and look at to make a good financial decision. And if you’re in Land Academy, you see us doing it every Thursday.
Jill K DeWit:
You watch us do the exact same thing with your deals when you ask us to say, “Would you do this deal that we do with our deals?” And Brandon does, and Lori does, whoever’s on the call with us, helping and having fun with us. It’s the same thing. You see us, and it’s the six A’s. We’ve set you up and told you what to look for, how to look for it, and how to judge these properties, and then how to act on them. So I’m going to go through them. Number one, Access. Is there access?
Steven Jack Butala:
Is it obvious? This is in the first 30 seconds of looking at a piece of property.
Jill K DeWit:
Yep. Yeah.
Steven Jack Butala:
Can you get to it or not?
Jill K DeWit:
Right. It’s physical and legal, hopefully both, number one. Number two, acreage. Is it big? Usually bigger and better, but I say acreage, is it what you want to do with it? Is it enough acreage to do what that person’s going to do with it? Maybe it’s all infill lots, and they need to be in a one acre, whatever it is, or big ranches. That’s the acreage. Did it show up what you wanted, and is it going to work? Three, let’s say attribute. What’s going on? Is it near something beautiful? Has it got a creek in the background? What have you picked up from your looking? These are all things.
Jill K DeWit:
Remember, you’re not visiting this property, is we’re helping you go through a list of things that you can do, that you should do on every single deal, so you know you’re making a good decision. So, attributes. Something great around there. Wow, look how close it is to Nashville. Fill in the blank. Affordability. Let’s use the data that we have at our fingertips to make sure, even though we sent out the offer, are we still buying a great deal? And then what can we sell it for, based on what’s going on in the market right now?
Steven Jack Butala:
Are you buying cheap enough? Yeah.
Jill K DeWit:
Exactly. Alive. Is everyone alive and able to sign? It’s a little thing, but you got to know this quickly when you’re doing your due diligence, because if you’re talking to the cousin or the nephew, let’s just say, “My aunt had this. She’s the last surviving member of the family. It should go to me, so I’m selling it,” that doesn’t necessarily mean it’s right. You need to make sure that the right person’s alive or it’s in the right name, so they can actually sell the property. And then the last one that Steven added, my number five, alive, was added recently, and your six is added the most recently, which I love, which is adjacent. You want to explain adjacent?
Steven Jack Butala:
What’s going on immediately around that property? So you’ve got this target property that you’re looking at. Should I be buying it or not? Well, to the south of it is this beautiful ranch that just sold for $13 million. To the north of it is a former waste management EPA site, and so no, that’s going to kill the deal at any price. So you need to look to see what’s going on in the immediate area of the target property, and see if your property fits in.
Jill K DeWit:
Exactly. So by doing those, and trust that you know those things to make a good decision, that’s how you overcome buying land you never seen. That’s it.
Steven Jack Butala:
And what, really, Jill saying is experience. So here’s the thing, if you’re brand new, “Oh, I don’t have the experience Jack. I can’t do this.” No, you have us-
Jill K DeWit:
Get on every Thursday call.
Steven Jack Butala:
You have us-
Jill K DeWit:
Watch us. Ask.
Steven Jack Butala:
… And you have a huge community of your peers that will not let you fail. And then, especially if you’re new, we’re not going to let you buy a piece of property or recommend that you buy a piece of property if you don’t get somebody there to see it, whether it’s a photographer or a real estate agent telling you that, “Yeah, this is a great piece of property. You should buy it. I can sell it for X.” And so that should take away all the concern that you have if you don’t have a lot of experience, take away all the concern that you have about, “Should I buy it or not?”
Steven Jack Butala:
I have a lot of stories all throughout my career of people, usually with the cocktail in their hand, looking at me saying, “Well, how do you know if you should be buying that or not?” And I’ve run out of ways to describe it, because if they’re asking that question, they, in my experience, will never get there. They will never work through the six A’s like Jill said, and never work through that thought process, where they have some confidence about buying a piece of real estate and selling it for more.
Jill K DeWit:
You know what? I really don’t worry about it. If you listen to us and follow us, and you know the six A’s and you do them all, then it should take all of your concerns away.
Steven Jack Butala:
I agree.
Jill K DeWit:
Thank you. Glad you could join us today. That was perfect.
Steven Jack Butala:
Why is that funny?
Jill K DeWit:
No, no, it was just a perfect little boom, done. Mic drop. Happy you could join us today. Five days a week, you can find us here on the Land Academy.
Steven Jack Butala:
Tomorrow’s Jack Thursday, and I’m going to talk about why is land investing like pulling teeth? You are not alone in your real estate ambition.
Jill K DeWit:
I can’t wait to hear what this is about.
Steven Jack Butala:
This is a direct quote from a guy named Graham in Discord-
Jill K DeWit:
Oh, I can’t wait-
Steven Jack Butala:
Who you and I have met. I really like Graham. He was in Career Path.
Jill K DeWit:
Oh, Herbert Graham.
Steven Jack Butala:
Yeah. I’m sorry, Herbert Graham.
Jill K DeWit:
Herbert Graham. Oh, good. Oh, this is going to be awesome. I can’t wait. Hey, thanks for tuning in. By the way, we would love to connect with you on Clubhouse. Join Jack and I on the first and third Thursday of every month at 12:00 PM Pacific Time in the Land Investing Club. It’s awesome. It’s taken off a life of its own, and we love showing up and doing it.
Steven Jack Butala:
We are-
Jill K DeWit:
We are Jack and… Sorry, I goofed you up there. It’s okay. Ready? Three, two, one. We are Jack and Jill. [crosstalk 00:15:14]
Steven Jack Butala:
We are Jack and Jill. Information-
Jill K DeWit:
And inspiration-
Steven Jack Butala:
… To buy undervalued property.
If you enjoyed the podcast, please review it in Apple Podcasts . Reviews are incredibly important for rankings on Apple Podcasts. My staff and I read each and every one.
If you have any questions or comments, please feel free to email me directly at steven@BuWit.com.
The BuWit Family of Companies include:
I would like to think it’s entertaining and informative and in the end profitable.
And finally, don’t forget to subscribe to the show on Apple Podcasts.
