Jack Thursday and What Your Father Never Told You about Land Investing (LA 1467) - a podcast by Steven Butala & Jill DeWit

Jack Thursday and What Your Father Never Told You about Land Investing (LA 1467)



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 sexy Scottsdale Arizona.

Steven Butala:Wow. How long have you been holding that in?

Jill DeWit:I just came to me actually, just S word, S word, sexy done.

Steven Butala:Today, when Jill's not horsing around, today, Jill and I talk about what your father never told you about land investing. this title I wrote, if you can't tell. 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. And if you're already a member, join us on Discord.

Jill DeWit:Jeff wrote,"Hey all. I'm sure this has been answered before, but if you have two comparable info lots across the street from one another, with the only obvious difference being that one is cleared and the other is wooded, is there typically a difference in value? In this case the cleared lot last year sold for $65,000. Just wondering if it's an apples to apples comparison."Steven Butala:
This is a fantastic question. Reality-based question and an academic question. So if you asked an economist this, if you're not an economist and you're not an accountant, you would never know that economists hate accountants and accountants hate economists. Accountants say to economists, get in reality. Yeah. Great. You sit in your office all day and come up with these concepts. But in reality, I'm an accountant. I'm in there in the field and we're looking at stuff and how to make or lose money. This is an academic question. an accountant would say this, the price different, I'm sorry, an economist would say this,"At the price difference is how much it costs to clear the lot. That's the difference."An accountant would say,"No, you're an idiot. It's whatever the market demands. There could be some real value in a wooded lot, because you're just going to create clear a little part of it to build a house."So there's your academic answer and there's a reality answer. I personally probably price them the same. Would you?

Jill DeWit:It's the funniest thing too. I'm like, I have to say too. It depends Jeff. So when you say infill lot, now I'm thinking house lots are not that big. If we were talking 20 or so acres, I'd want the wooded one. I think the wooded one would be more valuable than the barren one kind of thing. It's usually, that's how that goes, because you have a lot of options at that point. I totally agree with you. So in this situation, yeah, I would just be pricing it based on per acre average in the area. But my gut tells me that for a buyer coming in, having a cleared lot, if it's, again, I'm going to put a house there. It's somebody did the work. It's like someone poured a pad. Even if it's not exactly what you want to build your house, somebody started to construction and then they walked away. But they put in some of the infrastructure and poured a pad. That's worth something.

Steven Butala:All true. It's interesting you ask this now because the properties that Jill and I are buying, we really look at this. Because we're improving the property to resell it and we look at the cost of how much it's going to get that property graded correctly and all of that. And that stuff's not insignificant. It can be expensive. But I'll tell you if two people drive their car up to a property and they see a barren lot or if they see with one with beautiful trees on it, guess which one they're going to choose.

Jill DeWit:Then you have that.

Steven Butala:Beautiful trees.

Jill DeWit:There you go. Exactly. And they can decide where they want to put the house and position it and what trees they want to keep. So there's value there.

Steven Butala:Today's topic, what your father never told you about land inv...

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