Real Estate Agent Side Business (CFFL 367)
Real Estate Agent Side Business
Jack Butala: Real Estate Agent Side Business. Leave us your feedback for this podcast on iTunes and get the free ebook at landacademy.com, you don’t even have to read it. Thanks for listening.
Jack Butala: Jack Butala with Jill DeWit.
Jill DeWit: Hey.
Jack Butala: Welcome to our show today, this Tuesday. In this episode Jill and I talk about real estate agent side business. This is may or may not be … The perfect real estate agent side business or any side business for that matter. Hey, before we get into it, Jill, let’s take a question posted by one of our members on the LandAcademy.com online communities free.
Jill DeWit: Okay, Trevor asked: “Have you ever negotiated with a county on a large group of over the counter properties that they owned? I know, send a mailer. I stay up every night looking at these properties that are so cheap, but I want them cheaper.” That’s so funny.
Jack Butala: I have a lot to say about this. Go ahead, Jill.
Jill DeWit: No, dive in.
Jack Butala: First of all, Trevor’s awesome. He’s been with us for awhile. Trevor, you’re kind of breaking the rule about the mailers and thank you for addressing it at the end. You generally want to send mail out so that when you wake up in the morning, you’re opening the mail and you’re doing deals. You don’t want to spend a lot of time looking for deals, you want them to come to you. If you’re a regular listener to the show, you already know that.
Have I ever negotiated with a county? Yes. 9.9 times out of 10, it’s useless. It’s not because the person on the other end of the line that you’re negotiating with doesn’t love what you’re saying, they do love what you’re saying. It’s just so hard to get anything done with any government. The county is a government. They have to go through all kinds of procedures and stuff. The first thing they do is they go to the Board of Supervisors and they bring it up. The Board usually … Most counties that have a Board, they’re unpaid or they’re paid very little. They meet once a month and they go through an agenda. This gets on next month’s agenda:”There’s this guy that keeps calling, his name is Trevor, and he wants to buy everything but for a dollar a property.” Almost always they say no because the first thing they do is they look up the rules. There’s nothing there that states that or they look at the state statutes and the statutes say, “You must follow this procedure to sell these back tax properties.” That doesn’t involve negotiation so 9.9 times, it doesn’t work.
That being said, there was one time that I did this and it worked really well. I didn’t negotiate the price, I negotiated a release. I said, “Yep, I want every single thing on your tax role except these four properties.” It was in northern Arizona I did this a lot of years ago. “I would like to buy them 15 per month.” They said fantastic. We followed all the protocol, you’re not adjusting the price. We’re closing this thing down. I think there was 150 properties. It was Coconino County a lot of years ago. I tried it again after that and they wouldn’t do it. We had completed the deal. I’m not saying don’t try, but I really think that your time would be much better spent sending mail out.
The best deals, by the way, the best fantastic deals are tax liens. We shouldn’t even be talking about this today. The list that you’re looking at probably, in some states, are tax lien deals. You can buy the lien and then go through the 90-day foreclosure process or whatever it is in that state. Call the person and say, which is what we do all the time … We buy the tax lien for 50 bucks and then send a letter to the person that says, “We just bought this tax lien. We don’t want to go through this foreclosure. We don’t want any trouble. In fact, we have a lot of respect for you so we would like to just buy this property for some amount of money instead of going back and forth with the legal proceedings and the whole thing. We’re not foreclosure kind of people. We would really rather just shake our hands, send you 500 bucks or a thousand bucks and be done with it. At least you can get some money out of the thing, you clearly don’t want to keep it.” That approach, I think, is much better.
Jill DeWit: You know what’s funny, Jack? I have twice now this year, on two for two shows, heard you use the word negotiated and not cringe. You know what I mean? Usually in the world, if you bring up the word negotiate, Jack’s like, “Hang up the phone!”
Jack Butala: Let’s talk about this for a minute. What is it with negotiation? What is it with people that … I honestly don’t think negotiation is a natural human being thing.
Jill DeWit: I concur. I don’t like it.
Jack Butala: What do you think it is?
Jill DeWit: I really don’t like it. Am I good at it when we’re traveling? Yeah, because I’m ready for it, prepared for it. It’s a silly banter game. When you’re buying jewelry in Mexico, you just have to. That’s part of it. I don’t really like it. I’m okay paying fair price. That’s the thing. I’m here to pay fair price for a nice asset, and go off and do something with it. Whether I’m buying it from a store, a retailer, or a husband and wife that have owned a property for a lot of years. I’m not hear to beat people up and try to get the best price out of them, and then brag about it.
Jack Butala: That’s what it is. I think it’s a bragging thing at the end. Most of the time, my vision of negotiation is if you buy a car at a car dealership … Two nice people buy a car at a car dealership and they walk out, and they’re walking toward the car. Everybody inside the dealership, the salespeople are all jumping up and down and high fiveing each other because they made a lot of money on the deal. I don’t like that. I don’t think it’s good.
Jill DeWit: Should be a win-win for both.
Jack Butala: Yes. Thank you.
Jill DeWit: If they’re jumping up and down and high fiveing each other, I sure hope the husband and wife are high fiveing each other too. You know and I walk in, we just did this somewhere yesterday, you said, “You know, I walked in with a number in my head and I got what I wanted. I bet the place that we left, he got the number he wanted and everybody won. I’m happy with that.”
Jack Butala: We bought some household stuff. Some high dollar household furniture/whatever. First of all, it was one third off of the list price, so that’s why we were there in the first place. Then, I don’t feel any need to negotiate anything down. We ended up buying some other stuff from the guy because he was a good guy.
Jill DeWit: I’m really happy.
Jack Butala: Me too. I was real happy when we walked out, and we didn’t negotiate anything.
Jill DeWit: He was happy.
Jack Butala: It was already marked down.
Jill DeWit: You’re right.
Jack Butala: Here’s where it’s appropriate to negotiate. I don’t mean this to be the whole meaning of the show, but it actually is … Thank you Trevor, for bringing it up. If you’re a developer and you … Sam Walton was famous for this. He bought an airplane, he got his pilot’s license and fly around, and try to see in a rural location the best piece of dirt that he could put a Walmart on. Where he would innately grab a lot of traffic, a lot of drive by traffic, daily drive by traffic. He would go in then … He needs that specific piece of property. Maybe he’s got a handful … Maybe he comes back down, lands the plane and says, “These five properties will work.” I understand the negotiation piece. You go in and you really say, “Hey farmer Bob, I love this piece of dirt. I love it at X, can you see a way to pay Y, which I think is a fair price?” Sometimes you have to negotiate if you want that specific asset. In fact, in the eyes of the law every single piece of property is unique. For us, we’re buying houses that fit … We’re filling an order. It’s a lot of houses that fill that order, and land even more.
My gut is to just move on. Trevor, I think you’re wasting your time, but you’re going to learn a lot. Talk to the county a lot. The more you listen and talk with the counties, the more you’re going to learn.
If you have a question or you want to be on the show, reach out to either one of us on LandAcademy.com. Today’s topic, and you may know this from last Thursday, real estate agent side business. Why the heck are we talking about this again, Jill? I got an overwhelming, by leaps and bounds this is our most popular show topic. We got a lot of questions between then and now, and I want to cover them. Why is this … Forget about the real estate agent piece of this, why is this such a great side business, Jill?
Jill DeWit: I think …
Jack Butala: We have a whole list.
Jill DeWit: We do. I have a couple things … Number one is … This for me, I think, is the biggest thing. They love it. It takes so much work out of this … This is the kind of transaction that they’re used to dealing with. Buyers and sellers, and title agents, and inspectors, and lenders, and … Who else is … There’s a long laundry list of people involved. It’s such a great thing for them because it removes all of that. There’s a buyer, there’s a seller. That’s it. They understand the business. They get it. I love it. They also, because I know this from our real estate that are in our group, they can travel. They can do this from anywhere. They can scale it up, they can scale it down depending on what it is.
I know some of our agents that are doing this on the side. They are gearing up for retirement, whenever that is for them. They’re building up their portfolio of their own properties. Some months they’re really busy … We’re not going to devote a lot of time to this. Other months it might be dry in their world. I’ve got a back up plan. I have a side business. I have some other income coming in. I don’t have to worry about it. Those are my main things, and I think that’s why the people I’ve talked to love it.
Jack Butala: The questions that I got were related to this. Line this type of business that we’re in, line it up against other businesses that you could start. Let’s say you want to start a t-shirt shop. You got to get a supplier. You have to buy some machines. You have to go negotiate a lease. There’s a lot of stuff that you have to do to start a business. All of it, almost all of it, you don’t have to do with this. All you got to is send a bunch of mail out properly. Get educated first, send a bunch of mail out, and watch the offers come in. Then build your business around offers coming in and their resale that you’re doing. You don’t have to go get a physical location. You don’t have to hire anybody. You don’t have to borrow any money. It doesn’t cost you much money to start this at all.
All the basic stuff that stops people from going off on their own and being their own boss, in general, is not involved here. Especially the way we do, serve it up on a silver platter, with the education piece of this Jill. The whole thing.
Jill DeWit: It’s true.
Jack Butala: These daily shows. That’s why this show … I’m sure that’s why this topic … This is probably the fourth time since we’ve started doing this Podcast that we’ve brought up this side business right in the title. That’s why I think it’s so … It really does make a lot of sense. It made sense to me. You don’t have to quit your job, in fact don’t. Do it on a weekend. Yesterday’s show was one deal a month using the mail offers to owners piece. It really does make a lot of sense.
Here’s the good thing. If it’s not for you … We’ve had a couple people just say, “This is not for us.” Then great, you found out. It didn’t cost you a ton of money, you’re not sitting there staring at 12 month lease on a retail location, or you don’t have a bunch of money invested in software, all that stuff. It’s a great side business.
Jill DeWit: Remember that guy we met. There was a guy a long time ago … I think we were buying some property from him and this was years ago because you were helping with doing some things. It was funny because it came out that this was his business years ago, he retried, but he never could quite get out of it because it was fun and profitable.
Jack Butala: I do remember that.
Jill DeWit: It was really funny. He was like, “I kind of did what you guys did years ago on a big level. I don’t do that now, but I still have deals coming in. It’s never left.”
Jack Butala: After you do that first one or two, or three, deals I’ve noticed that people have … One of two things happens. “This is great. I’m going to do one or two, or three deals a month. I’m going to several thousand dollars extra a month, or whatever it ends up being.” If you’re insane like me, you stop your whole life, you sell everything, and pour it all into this. Like Luke Smith, we’re going to have him on the show later this week. He’s one of our original members and he just knocked it out of the park. He stopped everything. He pulled all of his money out of his IRAs.
Jill DeWit: Got his family involved.
Jack Butala: Extended family involved, answering the phones and stuff. He’s just making a mint.
Jill DeWit: Family meeting, this is what we’re doing now.
Jack Butala: He’s loving it. He’s famous for coming on our weekly calls and saying, “I play with my kids during the day and then I work all night.” I don’t know when he sleeps.
Jill DeWit: That’s true.
Jack Butala: How old is he, do you know?
Jill DeWit: I don’t know.
Jack Butala: We’ll ask him on the show.
Jill DeWit: We should ask him. His kids are young.
Jack Butala: I bet he’s in his 30s though.
Jill DeWit: That’s what I think.
Jack Butala: He’s got some energy still.
Jill DeWit: He does.
Jack Butala: He’s always got a different, weird take on stuff. He’s a total … He’s got an ownership mentality, takes responsibility for everything.
Jill DeWit: You know what’s funny about this, what you’re … You touched on something here. It’s interesting to me the high percentage of our members who … I appreciate this. I think that they did a lot of up front homework before joining us, and that’s my first choice, don’t rush into anything. Do all your homework because once they’re in, they’re in.
Jack Butala: They made a commitment.
Jill DeWit: They did. They’re not leaving …
Jack Butala: I’m noticing that. The last several members … The most recent members that we have, 10 or 20 ish, I’ve noticed that exact thing, Jill. They all come to, “I’ve been listening tot he show for six months. I’ve spent hours and hours looking at which direction to go.”
Jill DeWit: “I’ve tested this like you guys suggested.”
Jack Butala: “I know it’s going to work.”
Jill DeWit: Exactly.
Jack Butala: They’ve thought it all the way through.
Jill DeWit: I agree. We’re coming up on a year now since we started the whole data. I’m watching our people and they’re like, “Great. We’re ready to renew.” I’m like, “That’s it. They’re in.” They get it. They’re doing it. They’re using the data. We can see them download. The numbers … That’s how we can help and gauge what they might need coming up, depending on how many mailers are doing it. Offers to owners coming up. Making it even easier, that’s the thing too. As time goes on, Jack and I are here trying to come up with new products. That’s you, Jack. Making it easier for our members to be the deal makers. That’s what you should be doing. I tell people all the time, “You should not be licking stamps.” I got this from you. You should be making the deals, that’s it.
Jack Butala: You want to be a deal maker, you don’t want to be working a back office.
Jill DeWit: Pushing paper around and making sure the deed gets to the notary, and that kind of stuff. We’re working on taking even more of that off your plate.
Jack Butala: Hey join us on another episode where Jack and Jill discuss how to use information, that’s me.
Jill DeWit: Inspiration, that’s me.
Jack Butala: To get just about anything you want.
Jill DeWit: We use it everyday to buy property for half of what it’s worth and sell it immediately.
Jack Butala: You are not alone in your real estate ambition.
A lot of years ago I was talking to my former partner, who is now back with us involved in a certain IT capacity. We were having a bad day and I said, “I’ll tell you the next company I start is going to have no customers and no employees.”
Jill DeWit: How’s that working?
Jack Butala: It is working great. We have really happy customers in Land Academy and Land Stay.
Jill DeWit: That’s true.
Jack Butala: Land Pin now. I keep forgetting about Land Pin.
Jill DeWit: Land Stay is Land Pin.
Jack Butala: Land Stay is our little website. We have happy customers and we have very few employees in both companies now. We’re properly outsourcing stuff. We’re all able to do that because of software, because we’re organized. It’s a great side business, anybody can do it. You trip once and awhile, but you get back up and it works. I’m having a blast, are you?
Jill DeWit: Yeah. Totally.
Jack Butala: You are not alone in your real estate ambition.
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