Author Archive
Coming Back Home… to Wholesaling!
Posted on August 10, 2017 byYou have seen the infomercial… it goes like this…
- Start with wholesaling
- Make some money
- Start Rehabbing
- Make Bigger Checks
- Retire
There are a few variations on this theme, so allow me to share a different spin that I and a few colleagues of mine have explored. It looks more like this…
- Start with wholesaling
- Make some money
- Start Rehabbing
- Make Bigger Checks… sometimes but not always
- Quit working so hard and go back to doing some wholesaling.
So this is not exactly what we are doing since we are also doing new construction but remove the new builds from the equation and it is pretty close. So what’s the deal? Read More→
How to Be a Successful Wholesaler
Posted on July 13, 2017 byWholesaling is probably one of the easiest, yet most deceiving aspects of Real Estate out there. There is no shortage of people sharing how to be a wholesaler from online courses to packages to free videos. When looking at all the information available on the subject, how does one know which information is correct (including this article)?
As someone who has run a wholesale group in our market now for over four years, I am going to share with you the qualities required to be in my opinion a successful wholesaler. Our team has the privilege of being well connected and knowing most of them in our market. Having wholesaled tons of properties and observed others doing the same, here are the qualities you will want to have to be a successful wholesaler. Read More→
What is Massive Action?
Posted on June 8, 2017 byI recently read a book by Grant Cardone called the 10x rule. I am rereading it again now because it made such a strong impact. I highly recommend as soon as you are done reading this article, you buy it immediately. I do not get any kind of credit for it. It’s simply a must read for investors, in particular wholesalers.
Wholesaling is a massive action business. It takes massive action to keep the lead funnel going which is what powers the entire business. In his book, Grant talks about four levels of action to give clarity as to what your goal should be. I paraphrase them below. Read More→
The Power of Networking
Posted on May 9, 2017 byNetworking is perhaps the most underestimated resource every single investor has. I am constantly amazed at how in a world as interconnected as it is, I am constantly seeing how little we leverage each other to get more deals done. I sat recently and wondered why and came to some conclusions:
- Perhaps we are too ‘competitive’ and don’t want to share our deals
- Perhaps due to some less than ethical behavior, we keep our deals to ourselves and as a result have to work harder to get them moved
- Perhaps we had a bad experience in the past with another investor that has us playing ultra conservative
- Perhaps you believe ‘everyone else’s deals are bad’ therefore you must find your own (common issue)
- Perhaps you have know idea how big your market really is
- Perhaps you are too married to social media (most people who are Buyers want a phone call!)
There are probably several reasons we can come up with that aren’t written down here. The point is all of these above and more keep us from simply reaching out to others, much less doing business with them. Take for example social media. Read More→
When a Buyer Provides Feedback… Listen!
Posted on April 12, 2017 byThis month’s tip is so critical to your success. There will be many times when you put deals out and instead of getting an offer, you get feedback from your Buyer. If it is constructive, and oftentimes it is by people who sincerely want the property, listen! Buyers, especially experienced Buyers can provide a wealth of knowledge for you on your deals. They oftentimes have the scars of rehabbing and know many things you may or may not have thought of. You want to take advantage of this information!
Some things they may share with you:
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What is the real cost of the rehab (very common) to attain the ARV advertised
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What the actual ARV for that area is. Remember, if they work that market hard, they oftentimes know several fine nuances that wholesalers rarely consider. Read More→
Stop Assuming People Will Not Take Your Offer Or Counter!
Posted on March 8, 2017 byThis is probably the biggest tip I tell wholesalers all the time. When you are interested in a property, make the offer! That’s it!
It’s such a simple tip. See property, have interest in it. Make an offer. Yet for reasons continually inexplicable to me, too many investors simply don’t make the offer!
I recently sold a deal that I got seven offers on within 24 hours. The irony is I had it at a higher price in purpose for a test I was running and no one offered on it. When I lowered the price, all of sudden everyone was interested. When I sold it, several of the others said ‘that was a good deal!’ To which my response was, ‘it was but you could have had it sooner had you just made the offer.’ The look on their face was shocking as if to say ‘you mean we can offer a bit less than the asking price?’
Let’s clear this up right now… Read More→
Hungry Buyers Should Not Equal Taking Advantage of Them
Posted on February 9, 2017 byI have heard it 100 times over…
That wholesaler, fill in the name, totally ripped me off. False rehab costs, false appraisals, false inspection reports, false ARV…and on and on.
Last month we talked about experienced wholesalers. This month, let’s flip it over to the new Buyers. They are new, excited and hungry. And they are prime targets to get taken advantage of by some wholesalers. Unfortunate as it is, there are wholesalers that are less than credible. I have seen quite a bit of less than ideal advertisements. Some examples: Read More→
Would You Close on Your Own Deal?
Posted on January 11, 2017 byAs we get ready to start the new year, I would like to start with a basic question…would you close on your own deal?
I am an investor who loves wholesaling so I ask this question with sincerity. Would you close on your own deal that you send to your Buyers? Seriously, assuming you had the money in cash, would you?
If you have to think about the answer, then is it really a deal you should be sending out to your Buyers? Of course one can say ‘well it is not an area I invest in but others do’ and I would respect that of course. However, what I have found is a lot of wholesalers are not confident enough to where if they had to close on the deal, that they would actually do it.
In which case, I ask, why would you present that deal to your Buyers? Read More→
Appreciation – Wholesaler Friend or Foe?
Posted on December 8, 2016 byOne of the things I have seen a lot lately is wholesale deals banking on appreciation. And as a Buyer myself, I can tell you I love appreciation! Appreciation can cover a multitude of sins.
The problem is they are still sins and as a wholesaler, it is best to be aware of them if you want to move your deals! When running comps for your Buyer, the safest route is the tried and true MLS. Not Zillow or Trulia or some of these other online sites that can give snippits of value to the market but the good ol’ MLS.
One key piece to help avoid the appreciation challenge is to simply ensure your comps are current as of today. Not what you think it will be in three months or six months no matter how hot it is. Only today. Why? It keeps your Buyers safe. This is very important. It also keeps your numbers strong for your offers and negotiation so you can make sure you get a deal that makes sense. Nothing is worse than sitting on a deal you need to move quickly only to find it never had a chance because others did not see the value you saw. Read More→
Emotion – The Deal Killer
Posted on November 9, 2016 byEmotion is a tricky thing. We all have them. We experience them every day whether positive, negative or even indifference. I remember when I started investing being taught to never ever, EVER become emotionally attached to a deal. It sounded easy enough and as head knowledge it is.
But then a funny thing happens…people and or money become involved!
Oh yes, emotion can make the smartest of investors make the most let’s just say ‘bone headed of decisions’. I will have to admit, I have fallen prey to the power of emotion on a couple of emotions. Never underestimate this factor when doing deals!
Let’s examine both of these avenues in depth so you can see how powerfully they can work against you, sometimes without even realizing it.
In terms of people… Read More→
Momentum – How To Get It Right Now
Posted on October 10, 2016 byThis month we are diverting to another subject that is fresh on my mind. The concept of momentum.
Momentum is something we all know can be very positive but I believe is greatly underestimated. When I ride my bike I find some striking analogies to business. Riding a bicycle, whether rode or mountain involves momentum in a major way. It’s the difference between going up a big hill or walking it. It’s the difference between clearing a dirt ramp or rolling over it. It’s the difference between keeping your rhythm going or speeding up and slowing down constantly which is usually much more exhausting.
The same things apply in business. As a wholesaler, you have heard it said that you must always be marketing. I can tell you it is much, much easier to keep your marketing going than to allow it to stop and then start back up. On a bicycle, when I see a hill coming, I tend to attack it fast which makes it much easier to get to the top. Business is no different, when you see an issue coming up, hit it and hit hard with such determination that you will find solving problems becomes much, much easier. Your brain is more open. Ideas flow more freely. And you are much more likely to succeed in providing superior service to whoever you need to work with! Read More→
Handling Fear When Talking to Motivated Sellers
Posted on September 7, 2016 byFear… the word that has the ability to conjure up all sorts of emotions in a matter of milliseconds. A natural emotion we all experience. It is quite natural to assume you may have to deal with it when working with property. After all, we are talking about assets that can have several zeroes on the end of their price tag. Fear can be a healthy thing to keep us in check!
Arguably though, the majority of us will do almost anything to avoid being in a fearful state. Oh sure, some of us embrace it but usually it takes some maturing to reach that point to ‘confront’ fear.
So how does this relate to Sellers?
Usually we will take something like fear and make it a very, very big deal. New investors deal with this all the time but so do a lot of experienced ones. When talking with a Seller, there are all sorts of things we create in our minds to be afraid of. Some examples are as follows: Read More→
How To Build Credibility With Buyers – Part 3
Posted on August 9, 2016 byIn the last two posts, we talked about building credibility with Buyers. We have covered four steps so far. Last month, we talked about the importance of having a real deal and doing your own due diligence as key points. This month, we will talk about how to continue creating credibility and maintaining it for the lifetime of a deal.
Step 5: Maintain Open Communication
In a world where social media dominates and text messaging is overused for serious matters in my opinion, almost if not every Buyer I have met over the years prefers phone communication or in person when it’s time for real things to happen.
For most deals, we are talking about tens if not hundreds of thousands of dollars. Millions for the even bigger players. It is quite reasonable to assume that at some point, people want to talk to another human when doing a deal together. This is step 1 of what I call ‘real communication’. Talking to a real person on the phone achieves magic that an email or text rarely can accomplish. Read More→
How To Build Credibility With Buyers – Part 2
Posted on July 13, 2016 byLast month, we started by talking about a couple of basics that are an easy way to start setting yourself up for success with Buyers. Step 1 was Confidence and Step 2 was having an Online Presence. Both of these steps are key because people make first impressions as fast as you blink your eye these days. How you present yourself as an individual first is paramount. People do business with people they know, like and trust. The first two steps address this directly. Let’s continue with the next steps:
Step 3: Have a Real Deal
It may sound counterintuitive but if you have been in this business for a while, you know there are people that literally sit at home or work, get an e-mail from another investor, do zero due diligence if they even read the e-mail and then just click the forward button to their Buyers.
This is a fantastic way to kill your credibility in one shot using the miracle of technology. What makes it worse is there are times where the deal is not even under contract with the person sending the wholesaler the email. Then as a ‘trust everyone is doing the right thing’ investor, you forward that to your Buyers. I lost track long ago of Buyers that ‘do not like or see value in wholesalers’ because of this very thing. Read More→
How To Build Credibility With Buyers
Posted on June 8, 2016 byBuyers… a wholesalers best friend. A lifeline. The reason why we make the money we do with a smile on our face. However let’s face it, many wholesalers are fantastic at shooting themselves in the foot in this area. Even experienced wholesalers run into more challenging Buyers that while qualified to buy, are hesitant or even downright against buying from a wholesaler. Or they are just so picky that the time spent quickly feels like it is not worth the effort. These are not the easiest of hurdles to discuss. And even if they are willing to buy, how do you structure things to ensure you actually can close and not end up on the short side of the stick? (i.e. Buyer walks right before closing)
A few simple steps will make this hurdle much, much easier. We’ll cover two this month: Read More→
The Infamous Daisy Chain… Can It Work?
Posted on May 10, 2016 byIf you have Buyers that are experienced, they know the drill. A wholesaler gets a deal and pushes it out to their Buyers list. Then all the wholesalers on that list send it to their Buyers with some marking up the price. And then the next level does the same. And somewhere in there are the bird dogs that literally do nothing but press the forward button thinking ‘easy money’. Problem is the Buyer is on all of these people’s lists. Depending on the timing, he may see the lowest price first or one much higher. Or maybe the Buyer is not on the primary wholesalers list so he never sees the original deal.
At this point, the Buyer naturally goes to the lowest price wholesaler to get the deal. But if that wholesaler doesn’t control the deal, then the relay of information from wholesaler to wholesaler begins. And more often than not, inexperience or greed or dishonesty shows its head. You’ll find few cash Buyers are stupid so they pick up on this and walk from the deal. People can sense when something is up and all it takes is one less than confident conversation to kill the opportunity. Read More→
Always Have More Than One Deal Going!
Posted on April 13, 2016 byRemember being in elementary school? If it was anything like mine, sometimes a classmate would get in trouble and the teacher would make him write ‘sentences’ for punishment. Remember? Write such and such sentence 25 or 50 or eek! 100 times! It was like being sentenced to prison. It was very painful when one was young but we oftentimes got the message…don’t mess with the teacher.
So let’s bring that back for a moment. Repeat after me…
I shall always have more than one deal going…
I shall always have more than one deal going…
(Repeat as long as you need to until you never forget it…)
It’s such a simple lesson! But far, far too many times I see this happen with wholesalers, especially new ones. You work on this ONE DEAL so hard and do everything in your power to make it happen. And it is a sincere effort as well where there is rapport and legitimate effort being made to get it to the closing table. Then at the last second, the unthinkable happens…it falls apart. Seller suddenly changes their mind. Even worse, it’s for a legitimate reason such as a health issue arises. And the Seller is very apologetic and you know they aren’t making it up. Still the deal is dead, at least for the time being. Read More→
Your Power Team Represents You
Posted on March 9, 2016 byAs professionals we’ve heard it said that it is absolutely imperative that you have a really solid Power Team. A Power Team is composed of several individuals. Some of the most common in Real Estate are closing attorneys, loan officers, contractors, insurance agents and appraisers. These are all key people to any given transaction and any one of them can make or break a deal so it’s important to have ones that understand what you are doing, are on your side and have lots of quality experience.
We have had the privilege of working with many people along the way with varying levels of success. Some of these people have been nothing short of outstanding. On the flip side, let’s be honest, some are a bit of a nightmare to work with. As a result, we have learned to never underestimate what they can mean for your business. Let’s take attorneys for example.
A solid closing attorney is a critical part of your Power Team. We have literally had Sellers that were ‘on the edge’ about whether they should work with one of these ‘We Buy Houses’ people but were given an extra dose of comfort by our attorney. On the flip side, we thought we had an attorney that was on our side once literally talk down to a Seller. Sadly, it killed the deal. That particular deal was a renovation that was good for at least 50k…down the drain. Talk about a hard lesson in choosing your Power Team! Read More→
Four Steps to an Incredible 2016 Wholesaling
Posted on February 9, 2016 byRecently I did a meeting where we discussed what a wholesaler needs to do to have an awesome 2016. After giving it some thought, it’s really quite simple. Only four steps are needed and doing these four things consistently will make a huge difference in how much success one has. Let’s get right to the four steps to an incredible 2016 wholesaling!
- Marketing – The lifeblood of your business. No marketing, no leads. It is a requirement above all else. While there is a plethora of free marketing ideas as well as paid ones, the key is to do them consistently week in, week out, month in, month out. If this is a constant, leads will be a constant. Very simple yet a major pitfall of most investors out there.
- Networking – You have to get out and meet people, preferably in person. However, if you are wholesaling virtually then this is not always feasible to accomplish. Most wholesalers tend to be local so if that’s you, get in the car and go meet people at meetings! And not just REIA meetings but other types of Real Estate functions, general business meetings and even non-Real Estate related meetings. You simply never know where your next opportunity will come from whether Buyer or Seller. Networking can never be underestimated! Read More→
Consistency – A Wholesalers Trusted Ally
Posted on January 12, 2016 byAdmit it…this may be a familiar story to you. You learned about this money maker called wholesaling, did a few deals and made good money, celebrated and then told everyone how awesome this business is.
But then the dark time hit…
Leads dried up. Phone calls have slowed down. Market dynamics may have shifted. The list could be endless. Bottom line, all of the sudden the euphoria of making money quickly and easily has been replaced with concern and worry about what’s going on. All of a sudden your dreams coming true seem distant again and going the wrong direction…perhaps very quickly.
Or maybe the story goes like this… You learned about wholesaling and got excited about it. You did marketing one or two times, talked to a few people but nothing quite panned out. Maybe even three or four times. You got discouraged and decided this wasn’t for you. Read More→
