How Many Deals Can You Do at Once (HA 1267)

How Many Deals Can You Do at Once (HA 1267)

Steven Butala:
Steve and Jill here.

Jill DeWit:
Hello.

Steven Butala:
Welcome to the House Academy Show, entertaining real estate investment talk. I’m Steven Jack Butala.

Jill DeWit:
And I’m Jill Dewitt, broadcasting from sunny Southern California.

Steven Butala:
Today Jill and I talk about how many deals can you do at once? I’m quoting Jill right before we turned the microphones on, “Is this a number? What’s the show actually about?” And I said, “It comes down to what your comfort level is.”

Jill DeWit:
I was going to say, it comes down to, what do you think it’s about?

Steven Butala:
Oh, my gosh. Don’t you hate when people do that?

Jill DeWit:
Oh, my God. Let’s talk about this for a moment. What does that mean to you?

Steven Butala:
How does it make you feel? How does it make you feel?

Jill DeWit:
Define deal. What does a deal mean to you?

Steven Butala:
Why do people do that?

Jill DeWit:
I don’t know.

Steven Butala:
Thank you for not doing that.

Jill DeWit:
No. When I was growing up, I was a spank-me-and-send-me-to-my-room kind of person. Please don’t make me sit down and talk about why I felt the need to do whatever and use the couch furniture, the living room furniture, for this purpose in the backyard. That was it. “Jill, why would you turn our couch into a slip-and-slide with all the wax paper and saran wrap and aluminum foil you could possibly find in the kitchen?”

Steven Butala:
Oh, my gosh. Can we do that today?

Jill DeWit:
Right.

Steven Butala:
That sounds like a blast actually.

Jill DeWit:
Yeah. “And how did you get it out there, by the way? How many kids could you get involved to get the furniture out in the backyard?”

Steven Butala:
When the kids were little, we used to make sleds and go down the stairs. Remember that?

Jill DeWit:
Oh.

Steven Butala:
That was a blast.

Jill DeWit:
You did that-

Steven Butala:
Yeah.

Jill DeWit:
… with a sleeping bag.

Steven Butala:
Yeah, I used to do cardboard.

Jill DeWit:
Oh, my God, and that apartment that we had one time, oh.

Steven Butala:
That was a long time ago. The kids were little.

Jill DeWit:
It was a stairs and there was a wall. I remember it would just slam against the wall, and I’m like-

Steven Butala:
Over and over again.

Jill DeWit:
Somebody’s going to call on us or, worse yet-

Steven Butala:
Oh, the times that are turned now, Jill.

Jill DeWit:
There’s going to be a broken tooth. Yeah, that’s true. Well, then I was older. When you’re young, you didn’t see that. I didn’t see the danger in it. Now I do.

Steven Butala:
I don’t think it’s danger. I just think it’s messing stuff up. I don’t know what it is.

Jill DeWit:
I don’t know.

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

Jill DeWit:
Leonard wrote, “Hello, land investors. I bought a lot from the Commissioner of State Lands in… blank.”

Steven Butala:
Blank state.

Jill DeWit:
Blank state. “I’m trying to figure out exactly what I have. From Google Maps it appears to be located at such-and-such street address. Then ParcelFact shows that there was a sale of $58,000 in 2017. I think it’s a multi-parcel deal.” There we go. That’s what’s coming out here. “The county data shows this lot to be unimproved, but the lady on the phone also said there was previously a structure on it in 1990.”

Steven Butala:
Which is why it’s on The House Academy Show.

Jill DeWit:
Interesting. “I’m not sure where to go from here. Should I contact an agent? Would it have been an illegal addition if the structure looked like it was a duplex from Google Maps?” Interesting. “If anyone has done a deal with any knowledge like this, any knowledge is greatly appreciated. Sincerely, Leonard.”

Jill DeWit:
So, help me. I’m trying to read between the lines, and I think you know-

Steven Butala:
I do. The underlying question here and the real message here… and I’m not picking on you, Leonard, at all. We know who Leonard is, and he’s an active member, and we love him. There’s a lot of research and digging and stuff that goes on with tax deeds, really any real estate deal, and there’s always some unknowns. Almost every single deal has three or four or five unknowns. “Can I put a mobile on it?” “Well, they say I can.” “Is there a sewer at the street?” “Well, they tell me that the sewer’s at the street, but in the past I’ve been told that, and maybe in the same county, and it just wasn’t there.”

Steven Butala:
If this drives you nuts, if you’re the kind of person that needs to have every single box checked and every unknown flipped over and uncovered before you can move to the next slot and whatever you’re trying to accomplish, this is not for you. This is a great example of what goes on with tax deeds and what goes on with real estate deals in general. There used to be a house there? Excellent. Then you know for sure that somebody addressed the utilities somehow. That’s a massive improvement and an attribute in my head. Check. That’s a great, now I’m into the deal way more than I would be if it was just a really far out rural place, a rural vacant property.

Steven Butala:
You’re looking at Google Earth at this address. It ties with the APN. You can slide that slider on Google Earth, pick a date, all the way back to 1990. They have satellite images from 1990 to 2019 or 2020. You can see what happened very clearly. If one year the house is gone, the year before it was there. Now you’ve got two pictures to sell this property with, like, this is what used to be there, and this is what’s there now. This is all good news.

Steven Butala:
The way that this was written and the spirit of this question is, “Help. I don’t know the answers.” When do you ever know all the answers? You make the best of situation. He’s got a little bit more information from the county than typically I’ve gotten out of talking to the counties in this state, and so this is all positive. That’s how these things should be looked at. This is not OCD land.

Jill DeWit:
Can you imagine? Then the topic of the show would be, did you get your one deal done this month?

Steven Butala:
Yeah, this year. This year.

Jill DeWit:
If it was OCD land. How many did you do? One a month, but I know everything about it.

Steven Butala:
Yep, every single thing, and I know the property history back to whenever.

Jill DeWit:
Right. Exactly. I’ve personally spoken to every owner, and I know every person in the county, and I’ve taken them to lunch.

Steven Butala:
Here’s the perfect deal for us. It might not be the perfect deal for you. I send out a bunch of mail. Let’s say we buy a property. Jill buys a property for 20 grand. Maybe my offer was 15. She got it. We all decided 20,000 is good. We know the property is worth 80. We know that. We’ve talked to brokers. We’ve talked to people in the area, and maybe Jill called the 7-Eleven down the street, which is, I’m not exaggerating. That’s what she does.

Jill DeWit:
Recent stuff, what’s available right now.

Steven Butala:
Maybe… maybe she calls the county and says, “Can I put a mobile on there,” just to know. We stop right there and we build a great posting that inadvertently says in our posting, it says, “We have never done a lot of research on this property, but we know it’s a great deal for you.” That’s it. Probably, because you’re local, see some value in this, but we’re passing on a savings like Walmart. We bought it so cheap, so we can mark it up a little bit and send it to you. Not, here’s every single detail that is possible with this land. Here it is, and we’re going to give it to you for half price.

Jill DeWit:
Exactly.

Steven Butala:
Give yourself a big pat on the back and do yourself a favor. Don’t learn too much about these properties that you buy. Just make sure it’s not a crash-and-burn situation. That’s it. Then sell it real cheap to somebody local who believes… and they are. We wouldn’t be in business if we weren’t providing cheap real estate to people on our sell side. This would have been over with the first two years that I started if I was charging retail and explaining all this stuff about the property, basically explaining with all these details why I’m charging retail prices. I would have been out of business in two years, long before I ever met Jill. We’re in the business of buying incredibly cheap real estate, passing on the savings, and not really learning too much about the actual asset itself in the process.

Jill DeWit:
I’m waiting for the show.

Steven Butala:
Is it too much?

Jill DeWit:
I was done five minutes ago.

Steven Butala:
You and everybody else. Oh, that’s great.

Jill DeWit:
I’m just kidding.

Steven Butala:
It’s so much fun to co-host with you today.

Jill DeWit:
I’m kidding.

Steven Butala:
[inaudible 00:08:48] stop it, because Jill wants to hear it. How many deals can you do at once? This is why you’re listening.

Jill DeWit:
It was a little bit of a dead horse. It was going dead horse. Trust me, I’m the queen of that. I know that. All right.

Steven Butala:
You’re the queen of dead horse?

Jill DeWit:
You know what I mean. Look, I’ll throw myself under the bus. I have been told, that I at times can beat a dead horse, so I really have to try not to, so that’s why I said we answered the question, move on.

Steven Butala:
Speaking of being the queen of something-

Jill DeWit:
Oh-oh.

Steven Butala:
How many deals can you do at once?

Jill DeWit:
Well, I was just thinking about this. This is a house show, so there’s a house component and then there’s a land component. Trust me, I can do five times as many land deals as I can house deals because there’s a lot more involved. I’m going to do house comfortably, comfortably, easy, I could do 10 a month.

Steven Butala:
Oh, easy.

Jill DeWit:
Then land deals, I could do 50 to 100, but this is because too, in a past life, I’ve juggled 80 clients at one time and had to follow up and make phone calls. Three drop off and three more come on and that kind of a thing, and I like it. Again, too, because at this level, I can sit and review, like both of us, we can review a bunch of deals. I could have 10 deals and go, “Yes,” “No,” “No.” Not that fast, but in an hour I can look at them all and make a good decision of whether we’re going to buy them or not and get them moving kind of thing. What’s your number?

Steven Butala:
So, here’s how I look at it. I look at it two ways. How many deals can I mechanically handle at once? That number truly is in the hundreds and hundreds and hundreds at once. If you think of a hub and a spoke model, so you’re the hub, like an old wagon wheel, and you have a spoke coming out, let’s say that spoke coming out is a team. You’ve got a transaction coordinator and you have whatever it takes to get, I don’t know, let’s say one team can get 10 or 20…

Steven Butala:
This is how a title agent, by the way, a title, like First American Title runs their business. The hub is a local office, and then they have agents coming off of it utilizing resources. So, maybe a hub. The model for a title agency is 30. They expect a title agent to do 30 deals a month, which just means they’re perpetually doing 30 deals all the time. That’s a good number. Each spoke, you’re the decision maker and you’re doing the mail, which is almost infinite. In a hub, each spoke can do 30. That’s a lot of deals.

Steven Butala:
Then it becomes, and my second point is, how much money do you have? So, I’m constantly in this balance sheet state of mind, which still doesn’t know about where… We have cash and we have real estate value. You’re never, for me, at like 50/50, maybe like 75/25. You always want to have more real estate than you do cash, and so you kind of balance it that way. So, that can be a limit. How do you solve that in a hub and spoke way? With partners. So, it’s not how many deals can you do at once that is really the question, because you can do a lot of deals. There’s other stuff involved.

Jill DeWit:
Okay. I agree. I’m lost. I’m sorry. I got under your hub and spoke thing, and I’m still thinking about the deals and getting them done and what’s important with the deals. So, I apologize. I got a little distracted there. It happens.

Jill DeWit:
Happy you could join us today. Every Monday, Wednesday, and Friday, you can find us right here on The House Academy Show. On Tuesdays and Thursdays… Wait a minute. We’re here. This is a Thursday. Monday, Wednesday, Friday, we’re on The Land Academy Show. I’m totally lost right now. Tuesdays and Thursdays, we are on The House Academy Show.

Steven Butala:
Tomorrow the episode on The Land Academy Show is called, What gets Jill excited? You are not alone in your real estate ambition.

Steven Butala:
It was not this episode. I can tell you that.

Jill DeWit:
No, I’m so sorry, because I thought of it. I had one vision in my head and where the show was going to go.

Steven Butala:
So, what was it?

Jill DeWit:
I was thinking about it.

Steven Butala:
Did I miss it?

Jill DeWit:
Yeah, it was not… I was thinking of it, how many deals can I really do and turn and buy and sell in an infinite amount of time, not as a whole company system, so-

Steven Butala:
Oh, like how many deals can you do in your career?

Jill DeWit:
Yeah, that’s right. I was thinking just like as a month.

Steven Butala:
That’s good, how many deals-

Jill DeWit:
That’s how I was thinking. What can I do at once, and it was given my current team, my current financial situation and everything. Nobody’s right or wrong here. You just took it to a big picture level, and I’m like, well, I never saw that. It’s okay.

Steven Butala:
I think it’d be valuable. How many deals can you do?

Jill DeWit:
I already answered it.

Steven Butala:
Okay.

Jill DeWit:
I just like, that’s where you took it to a bigger picture level. It made me ponder all kinds of other things as you’re talking big picture. I was talking about the chapter in the book, and you were talking about the series of books and how it’s going to change everyone’s viewpoint on this topic, whatever it is. Seriously. So, that’s where I was.

Steven Butala:
That’s not the first time that’s happened.

Jill DeWit:
Well, poop, I’m only thinking about Chapter One. I’m like, well, I feel like an idiot over here, and you’re talking about philosophy, and that’s where I got a little bit lost in your philosophy.

Steven Butala:
That’s not the first time.

Jill DeWit:
Oh, that’s true, and it won’t be the last.

Steven Butala:
I can hear podcasts and devices turning off all over the country.

Jill DeWit:
Right. Great. No, that’s called… You know the Keep It Simple, Stupid, or keep it… Yeah, right. Is that right?

Steven Butala:
No, that’s it, yeah.

Jill DeWit:
Okay. So, they’re going to come up with a new one, Dumb It Down For Jill or something like that.

Steven Butala:
Or Keep It Simple, Steve.

Jill DeWit:
Keep It Simple, yeah, that’s it.

Jill DeWit:
The House Academy Show remains commercial free for you, our loyal listener, so wherever you’re watching, wherever you are listening, please subscribe and rate us there.

Jill DeWit:
We’re Steve and Jill.

Steven Butala:
We’re Steve and Jill. Information-

Jill DeWit:
… and inspiration.

Steven Butala:
… to buy undervalued property.