Funding Member Deals from Our Personal Checking Account (LA 1173)
Transcript:
Steve Butala: Steve and Jill here.
Jill Dewitt: Hello.
Steve Butala: Welcome to The Land Academy Show, entertaining land investment talk. I'm Steven Jack Butala.
Jill Dewitt: and I'm Jill Dewitt, broadcasting from sunny Southern California.
Steve Butala: Today Jill and I talk about funding member deals from our own personal checking account. As I said yesterday, this is true, we, Jill and I have, there's no smoke and mirrors here. When we decided to do a deal, funny deal, and Jill's going to talk all about it today, it's comes out of our personal account. That's how much we believe in the deal and the person that we're doing the deal with. 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 Dewitt: Charlie asks, "I have a chance to buy a lot as a very small set of buyers. I have one guy that normally buys everything with almost no research into the properties other than a brief title check. He doesn't care about access or attributes. My dilemma is that this new property is 100-plus acres and him and I are normally dealing in the five to 10 acre range. So how do I ask if he wants a property that I don't own yet because if he's not interested then I'll pass on it as well? Thanks."
Steve Butala: This is a great question and it's one that I think is pertinent to anybody that's been in this business for more than six months. We all find people we'd love to sell property to and there was a time in my career, not so much anymore, where I was only working with one or two, on some cases just one buyer. If it didn't fit the Mark, I just moved on. This was long before a Jill or Land Academy. So I understand this point in your career where you are, and my advice would be to you if you've done a bunch of deals with this person, just lay it on him. See if he says yes or no.
Steve Butala: I'm not sure I would pass on it if it's a great deal, especially because this group exists that we're in, so if it's a good deal, I would get it into landtank.com or get it onto at least landinvestors.com and say, "Hey, this deal doesn't work for me. It might work for you guys. Let's partner it, but I don't want to put any money in," or, "Hey, why don't you throw me 1000 bucks if you believe in the deal? I'll turn it all over to you." But don't let it go to waste.
Jill Dewitt: Mm-hmm (affirmative). I agree and I too, even since we've been working together, I've had buyers that I really knew. I knew right away when we're buying them. I know who's going to buy this one. I know who's going to buy that one and who's going to buy this one. I love those relationships because it's such an easy conversation. I just send him, "Hey, I just got these this week. You want them?" He'll say, "One, two and five. Yep. Done." That's all we talk about. He knows where to wire the money. I watch it pop in. I know how he likes the deed done, I just do it. That's the extent of it. It's one email to him, one email back, and then the deal is done. So these are great. I agree with you, when you said a very small set of buyers, to me what I'm hearing Charlie say is it's a small buyer's pool or just unique person who's going to want 100 acres.
Jill Dewitt: I agree. And then price point, just like with any real estate, there's a price point where you get a lot of people, maybe what the middle-class can afford, let's just say, that kind of a thing. I'm sure it applies to cars. It applies to everything. It applies to jewelry, everything.
Steve Butala: Food.
Jill Dewitt: Food, restaurants. There's a sweet spot there. Then it's also, you have a spot with a size of the properties. Some people will look at one acre and go, "Oh, that's too big." There's a lot of people that five to 10 acres. What we found, south of 10 acres, people can swallow that. Five acres, you could stand there and walk it and see it, but 100 acres,