Plan for Your Last Acquisition (LA 790)

Transcript:

Steven Butala:                   Steve and Jill here.

Jill DeWit:                            Hi.

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 gorgeous southern California.

Steven Butala:                   Today Jill and I talked about planning for your last acquisition. What the heck does that mean?

Jill DeWit:                            It sounds kind of sad.

Steven Butala:                   The gist of it is this: you want to have control over the end of all this, not have it control over you.

Jill DeWit:                            I like that.

Steven Butala:                   So it's something that they teach you in business school, and it's conventional wisdom for everybody who ever buys a company or buys an apartment building. But it's something that, it's worth discussing here. For sure.

Jill DeWit:                            Thank you.

Steven 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.

Jill DeWit:                            Joe asks, "For those of you who create financial forecasts or annual operating plans ... "

Steven Butala:                   That would be me.

Jill DeWit:                            Right? That would not be me. "What time frame do you use for estimated days on market on acquired properties? I realize the logical question I will receive is, 'How long has it taken you to sell your land in the past?' While nine days seems reasonable, I'd love to hear the average time it takes other members to sell their land and if they forecast a more conservative time frame. Thanks."

Steven Butala:                   I run it, this is a good question.

Jill DeWit:                            Yeah.

Steven Butala:                   I run it. Or I can input it.

Jill DeWit:                            What does that mean?

Steven Butala:                   So I run all of our forecasts. If you've ever watched any of our education or seen a live event, I'm constantly in Excel running if-then scenarios. So I run it at 30, I run it at 60, and I run it at 90. I never, I don't take it past 90. If you have a property that doesn't sell and it takes longer than 90 days, and we've all had them, I'm just saying if this is the norm for you, there's something wrong.

Jill DeWit:                            Something bigger.

Steven Butala:                   Yeah.

Jill DeWit:                            Right. Like you're pricing them too high.

Steven Butala:                   Or you're not ... The right people aren't getting ...

Jill DeWit:                            Notified.

Steven Butala:                   ... to know them, or you're buying really bad property or there's just some kind of flaw. So for houses it should be cash in, cash out, 30 days.

Jill DeWit:                            Right.

Steven Butala:                   In this market. And that will change, but, houses 30 days. Info-lots, 45. Rural vacant land, 60.

Jill DeWit:                            Depending on how big it is.

Steven Butala:                   And then I would run a worst-cast at 90 days, but.

Jill DeWit:                            I mean dollar amount, not ... Dollar amount and size.

Steven Butala:                   Yeah.

Jill DeWit:                            But yeah....

Funding Acquisitions (LA 789)

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 DeWit, broadcasting and hungry from Southern California.

Steven Butala:                   Are you hungry?

Jill DeWit:                            I am hungry.

Steven Butala:                   Today, Jill and I talk about funding and acquisitions all week, because it's acquisition week.

Funding Acquisitions (LA 789)

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 DeWit, broadcasting and hungry from Southern California.

Steven Butala:                   Are you hungry?

Jill DeWit:                            I am hungry.

Steven Butala:                   Today, Jill and I talk about funding and acquisitions all week, because it's acquisition week.

Jill DeWit:                            Yay.

Steven Butala:                   It all starts with solving-

Jill DeWit:                            Yay. Who doesn't love acquisitions? I love it.

Steven Butala:                   Funny, all acquisitions starts with why banks suck. Before we get into it, let's take a question from one of our members on the land investors online community stream.

Jill DeWit:                            I see it as a great fun thing and you see it as banks suck. How funny. This is why we balance each other out.

Steven Butala:                   There's nothing better than acquisitions.

Jill DeWit:                            Thank you. That's what I like.

Steven Butala:                   Land acquisitions are great. House acquisitions are fantastic. Functioning, income producing real estate is awesome.

Jill DeWit:                            Well, I think of it-

Steven Butala:                   Acquisition, acquiring companies is fantastic.

Jill DeWit:                            See, I think of an acquisition like a wedding. It's all exciting and fun and it's a big party.

Steven Butala:                   Yeah, me too.

Jill DeWit:                            If you plan for it, it's great. And we'll just leave it at that.

Steven Butala:                   I don't like ... nevermind. We'll get into it in a second.

Jill DeWit:                            Neal asks, at present, I'm working on a planned [inaudible 00:01:22] campaign where the average days on market are less than 20 days.

Steven Butala:                   Wow.

Jill DeWit:                            Yeah. Sadly, the number of [inaudible 00:01:29] lots are few and far between in Sartorius. No kidding. The ones most abundant tend to be on the outskirts of the target area where new development is under way and the lots are already owned by developers/builders. I had planned to mail such companies with a different offer letter that would still make an offer, just in case, but also hopefully open the door to an eventual relationship with them as a buyer.

Steven Butala:                   That's a great idea.

Jill DeWit:                            That said, I thought I'd solicit our humble little community for feedback and advice. So, please share your thoughts. Do you or would you bother mailing development companies when they pop into your data? Do you bother spending the time to research contacts et cetera?

Steven Butala:                   Yes.

Jill DeWit:                            Take care everyone. Great, great, great question. Love it.

Steven Butala:                   Yeah, there's lots of questions in there and the answer is I think, yes to every single one of them. I don't ... when I know that there's a developer in a really, really healthy community like that, where there's some older parts of the community and then there's newer ones, I don't send lots to every single APN, letters to every single APN.

Larger Than You Ever Imaged Acquisitions (LA 788)

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 Dewit, broadcasting from sunny southern California.

Steven Butala:                   Today, Jill and I talk about larger than you ever imagined acquisitions.

Larger Than You Ever Imaged Acquisitions (LA 788)

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 Dewit, broadcasting from sunny southern California.

Steven Butala:                   Today, Jill and I talk about larger than you ever imagined acquisitions.

Jill DeWit:                            Larger is always better.

Steven Butala:                   Really?

Jill DeWit:                            I'm just kidding.

Steven Butala:                   You're on a roll with that stuff lately.

Jill DeWit:                            Sorry.

Steven Butala:                   Is that true?

Jill DeWit:                            No.

Steven Butala:                   Is it?

Jill DeWit:                            No.

Steven Butala:                   Or just not absurdly small?

Jill DeWit:                            We're not gonna talk about that.

Steven Butala:                   Oh. Here's the thing that Jill and I were just talking about right before the show, we teach and guide people to buy and seel real estate. And a lot of what we talk about, to bring it down to meet them from where they're coming is A to B to C to D, bang, you got some money. Do it again, a little bit more money. But we don't talk about enough. And we designed a live event around this that's happening in a few months to talk about this and what the whole show is about.

The sky's the limit. People make 70, 80, 150 million dollars on a real estate deal. On land deals.

Jill DeWit:                            Exactly.

Steven Butala:                   What stops people, especially newer people in the first five years of their career is this concept ... we're actually talking about the show, I guess.

Jill DeWit:                            I guess we are.

Steven Butala:                   "Well, I only have $5,200 in my bank account, how the heck can I make 70 million bucks on a deal?" Well, the answer to that, I'll give you the answer to that Mr. Bender next Saturday.

Jill DeWit:                            Oh.

Steven Butala:                   Before we get in to it, it's the Breakfast Club.

Jill DeWit:                            I know that.

Steven Butala:                   Before we get into it, let's take a question posted by one of the members, one of our members. On the Land Investors online community, it's free.

Jill DeWit:                            Milan asked, "Title companies," I feel your pain here Milan, "Title companies are driving me crazy with their long close. A few properties I'm buying through a couple of title companies are now in one month wait and counting. And still nothing happening."

Steven Butala:                   A month is about right.

Jill DeWit:                            "When you contact them, they're polite and they say, oh we're still waiting for the title report."

Steven Butala:                   Yeah, they're not.

Jill DeWit:                            "Grrr," he says. "My question for you guys is what is your strategy to make sure the seller doesn't change his mind in this never ending wait?" I know, I know. They sign a purchase agreement, but I believe they can back out from the deal anytime if they want, which is true. "I'm thinking about sending the seller a check for $300 just to sort of keep them committed, what do you guys do?

Bad Acquisitions (LA 787)

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 DeWit, and we are broadcasting from sunny Southern California.

Steven Butala:                   Today, Jill and I talk about bad acquisitions.

Bad Acquisitions (LA 787)

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 DeWit, and we are broadcasting from sunny Southern California.

Steven Butala:                   Today, Jill and I talk about bad acquisitions. Why would you choose a topic like bad acquisitions? Here's why. Because yesterday we talked about good acquisitions. It's the Yin Yang of life, right?

Jill DeWit:                            Bad acquisitions. Bad, bad, bad acquisitions.

Steven Butala:                   Like when the kids are little.

Jill DeWit:                            And how to avoid bad acquisitions, what they are, how to see them coming, how to kick them to the curb. You like that? That's gonna be my rant today.

Steven Butala:                   Guess what? Bad acquisitions happen, because you pull a trigger on something you shouldn't be buying.

Jill DeWit:                            It's true.

Steven Butala:                   We have long since done that, I'm so happy to report. I'm trying to think of a bad acquisition we've done.

Jill DeWit:                            You know what's funny? Some of our people think that, oh, because I didn't exactly double my money, that that's a bad acquisition. I'm here to tell you that's is not a bad acquisition, so we'll talk more about that.

Steven Butala:                   I only made 80,000, instead of 100,000.

Jill DeWit:                            Shucks. I know. Darn.

Steven Butala:                   Before we get into it though, let's take a question posted by one of our members on the LandInvestors.com online community. It's free.

Jill DeWit:                            Max asks, "Hi, everyone." Totally. Max asks. I have to really annunciate that. "Hi, everyone. I am new to land investing and wanted to reach out to the community to try and get a better understanding of the process to find good, cheap land to buy. Is it safe to say that I can potentially send out my mailer to any county that returns enough results in my acreage/price point, et cetera?"

Steven Butala:                   Yeah.

Jill DeWit:                            "My plan is to find any state/county of my choosing where the price point fits my purchasing comfort level. From there I plan on using Data Tree to plug in the state, county, acreage, and vacant land characteristics. If it results in more than 1,500 rural vacant land properties, does that mean it's a good county to send offers out to? I would price a property based on the zip code by taking one fourth of the cheapest property in each and set that as my offer. I'm completely new to this [inaudible 00:02:22], so any advice or help would be greatly appreciated. Thanks."

Steven Butala:                   Go, Jill. Go.

Jill DeWit:                            I was gonna say for being completely, completely brand new, boy, are you on the right path? You're gonna kill it. If this is you knowing nothing, holy cow. What are you gonna be like? You're gonna be a machine a year from now.

Steven Butala:                   Well, this is this person being new at ready to do it, but he's been listening to the show.

Jill DeWit:                            Yes.

Steven Butala:                   Or talking to people on Land Investors.

Jill DeWit:                            Soaking it all in.

Steven Butala:                   Yeah. Soaking it all in.

Good Acquisitions (LA 786)

Transcript:

Steven Butala:                   Steve and Jill here.

Jill DeWit:                            Hi.

Steven Butala:                   Welcome to The Land Academy Show, entertaining land investment talk. I'm Steven Jack Butala.

Jill DeWit:                            And I'm Jill DeWit broadcasting from sunny Southern California.

Steven Butala:                   Today jill and I talk about good acquisitions, one of my favorite topics. In fact, all week this week.

Good Acquisitions (LA 786)

Transcript:

Steven Butala:                   Steve and Jill here.

Jill DeWit:                            Hi.

Steven Butala:                   Welcome to The Land Academy Show, entertaining land investment talk. I'm Steven Jack Butala.

Jill DeWit:                            And I'm Jill DeWit broadcasting from sunny Southern California.

Steven Butala:                   Today jill and I talk about good acquisitions, one of my favorite topics. In fact, all week this week.

Jill DeWit:                            That's probably my most favorite-

Steven Butala:                   Is acquisition week. Yeah.

Jill DeWit:                            My most favorite topic.  What's better than that?

Steven Butala:                   Like, what are some of the titles here? Yeah. What's better than good acquisitions? I mean, there's a few things.

Jill DeWit:                            Well, you and I talk about it all of the time, is that so many problems, I know you're gonna get into this, pretty much most of your problems can be solved by good acquisitions.

Steven Butala:                   Yeah, so all week we'll talk about good acquisitions, bad acquisitions, how to fund your acquisitions, all that stuff. Keep you out of trouble completely.

Jill DeWit:                            Yay!

Steven Butala:                   Before we get into it though, let's take a question posted by one of our members on the land investors online community. It's free.

Jill DeWit:                            Okay. Scott asks: "What paperwork ... excuse me ... what extra paperwork tax disclosures, et cetera, are involved once you charge an interest rate. I've always just embedded the interest by charging a higher price for a term sale then dividing by the number of payments, so the rate isn't specifically stated anywhere. There's the financing price, then a discounted cash price, but I like the idea of charging interest though, because you can say it upfront, the price of the property's actually lower. It appears more attractive, but you end up getting the same at the end once the interest is added on top. Most buyers won't care to calculate the interest they will pay over the course of the note."

Steven Butala:                   This is a great question.

Jill DeWit:                            Which is true. It's nice, because it's like, when you say, "I'm selling this for $21,000, and 3.5% interest. They do hear $21,000, and they hear, "Well, 3.5%. Gosh, my credit cards are 14, 15, and my car is XO. Gosh, 3.5% sounds good." I understand the process. The thoughts.

Steven Butala:                   This is very, very, very, heavily regulated, this topic of financing. If you ever look at your credit card, the thing that you sign off on when you get a credit card or your mortgage, it's very regulated. Federally, and I think there's a bunch of state regs involved-

Jill DeWit:                            Right.

Steven Butala:                   But federal for sure, and I don't think, don't quote me on this, it used to be this way, I'm not sure now, that it's legal to not charge interest. You do have to charge .0001 interest-

Jill DeWit:                            On seller financing stuff?

Steven Butala:                   Yeah, you have to charge an interest rate-

Jill DeWit:                            But it varies by state?

Steven Butala:                   By the question. We all know that almost always the buyer doesn't care. They just want to know what their payment is.

Jill DeWit:                            It's true.

Leave Your Land Alone (LA 785)

Transcript:

Steven Butala:                   ... Jill here.

Jill DeWit:                            Hi.

Steven Butala:                   Sorry, hi, Steve & Jill. Welcome to the Land Academy show, entertaining land investment talk. I'm Steven Jack Butala.

Jill DeWit:                            And I'm Jill DeWit, broadcasting from sunny southern California.

Steven Butala:                   Today, Jill and I talk about leaving your land alone. We've been talking about her all week.