Transcript:

Steven Jack Butala:

Jack and Jill here.

Jill K DeWit:

Hi.

Steven Jack Butala:

Welcome to the Land Academy Show, entertaining land 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, should we be buying infill lots in this down market?

Jill K DeWit:

That was an interesting conversation that we had the other day. That was on the Thursday member call. I had to think about that, where it was. There's been a lot of talking in my world last couple weeks. Lot of things. It was so fun. If you're listening now, and you were on that webinar that I did last week on Thursday night, yep, did not know it was going to go that long, but I really wanted to answer everybody's questions. I just looked up and I'm like, "Whoa, what happened at the time?" But that was really fun. Anyway, I'm still a little worn out from it.

Steven Jack Butala:

I think it's natural. Well, I'm used to it. We're both used to it now because it's natural at the end of the year, and the beginning of the year, to make life decisions about where you want your life to go. And buying and selling land is, if it's on your radar, it's an expiration time.

Jill K DeWit:

Got it. Well, I was saying, yeah, there's a lot of talking, so that's why I got ... This came up on the member call. No, and one of our advanced members shared some really good in insight information about his experience working with builders.

Steven Jack Butala:

Yeah.

Jill K DeWit:

And big builders. I can't run the name of them, but it doesn't matter. But it's cool.

Steven Jack Butala:

So they're in the market and buying. That was my takeaway.

Jill K DeWit:

I have no idea.

Steven Jack Butala:

Before we get into it, let's take a question posted by one of our members on the Land Investors online community. It's free. But before we get into all of that, I hope by now, Jill and I have a full-blown commercial printing company called offers2owners.com. We set this up several years ago because we were frustrated with the level of service and understanding that we were getting from normal, right off the street, commercial printing companies who print catalogs and stuff. What we set up was, and is, a printing company that just sends mail, Offers 2 Owners.

Jill K DeWit:

Can I just add that they have a special going on and it's four more days.

Steven Jack Butala:

Oh yeah, it's huge. Huge special.

Jill K DeWit:

So what he's talking about, it's 11% off mail, 16% off concierge data, which is awesome. So check it out on offers, and the number 2, owners.com.

Steven Jack Butala:

A lot of people prepay. A lot of our members prepay for their mailers for next year for tax reasons. So if you feel like you're in that category, give those guys a call, they'll explain it.

Jill K DeWit:

Oh yeah.

Kay wrote, "Hi. I'm new to land acquisitions. Please correct me if I'm wrong or misunderstood. If I work backward, home value in an area is $100,000. Land retail price will be around $25,000. And we try to send offers about 50% of the retail price. So $25,000 time divided by 50% is about $12,500. So should we send an offer at $12,500 per residential lot? That right? Please advise. Thank you in advance."

Steven Jack Butala:

So again, Kay, your math is completely correct.

Jill K DeWit:

Yep.

Steven Jack Butala:

It's what I call the rule of quarters. You have a $100,000 house. A builder is usually willing to pay 20% of the value of what a new house would command in that market. 20%, let's say 20-to-25%. So $100,000, they're willing to pay 25,000, so you need to be half of that at 12, let's say. And then, so you buy for 12 and sell it to the builder for 20 or $25,000. Thank you, yes. The math is correct on that. You can't build a house for 75 grand.

Jill K DeWit:

That's what I was going to wonder if you were going to dress that. I was waiting. I'm like, "What is this going to look like?"