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How to Get Any Seller to Accept Your Offer in 24 Hours (or Less!)

The BiggerPockets Podcast
49 min read
How to Get Any Seller to Accept Your Offer in 24 Hours (or Less!)

Investment properties are hard to find—unless you use the tips Jonathan Greene mentions in today’s episode. If you’re like most real estate investors, you know that in 2022, it can feel like you’re constantly getting nickeled and dimed over every aspect of your offer. The seller wants more money, a quicker closing, refuses to give seller concessions, and acts like their often outdated, structurally unsound property is worth as much as their neighbors’ new construction down the street.

How do you negotiate with these sellers to actually get the deal done at a price that won’t destroy your future profits? Or, maybe a better question to ask is, how do you find deals already on the market, with desperate sellers waiting to accept any offer that comes their way? What if you’re a brand new real estate investor, still looking for your first rental property? How do you get on the same wavelength as a tough seller?

Jonathan Greene is known around the BiggerPockets forums as a millionaire mentor. He left his career as a criminal prosecutor to start profiting from investment properties. Now, he runs an agent team that has built seriously strong negotiation tactics, and Jonathan still invests heavily on the side. He’s walked away from more deals than he can count. But, he’s also won deals that other investors would have no chance at acquiring. Want to repeat how Jonathan did it? You’ll hear it all in this episode!

Click here to listen on Apple Podcasts.

Fast track to Agent Finder to connect with investor-friendly agents like Jonathan that can help you negotiate with expertise.

Listen to the Podcast Here

Read the Transcript Here

David:
This is the BiggerPockets podcast show 667.

Jonathan:
One of the things that I’m so intent on with new investors, which I’m sure you guys will agree is if you buy your first property and then you’re going to buy your second property before that first property is at max value, meaning like you fixed everything that’s going to be a high number later. You’re going to eventually get caught on all of them. And if you do that, when there’s a market downturn, you’re going to lose them all.
So, I like people to really fix up that first property. It doesn’t have to be perfect. If you know that HVAC is going to break, you know there’s a big cost coming and you can’t go buy another property, because you’re going to get caught on both of them and not be able to pay for repairs on either at that time.

David:
What’s going on, everyone? This is David Greene, your host of the BiggerPockets Real Estate Podcast, coming at you today from Scottsdale Arizona, where I’m hanging out at the property that Rob and I bought and getting ready for a retreat to cook some other investors. And I got to say it is gorgeous out here as I say every time I’m here and we brought you a gorgeous show. Today, we bring back Jonathan Greene, my long-lost cousin, who we had on episode 584. And we had such a good time that we brought him back for more.
Jonathan is a real estate agent and investor who buys houses for himself to flip, also invest in commercial property. And more importantly, helps other people like you build wealth through real estate. And in today’s show, we talk about the different ways Jonathan does that. A big portion of it is negotiating, how he negotiates for his clients, how you can negotiate for yourself, what is happening in a negotiation, behind the scenes, as well as how to find on-market properties with motivated sellers, how to approach each deal, how to look at a house and see the things that other people are missing and more.
I had a great time today. Rob, what were some of your favorite parts of the show?

Rob:
All of the things you just said. You took all my points, I had them already. And I was like, “Dang it, those were all my favorite points too.”

David:
Yeah. I basically say all the best parts. And then, I give you two seconds to think of what you’re going to say after I just said them.

Rob:
All right. Well, I have something. I also liked that this was a, I mean, I guess this is what you said, dang it, is a negotiation master class. We hear everybody’s point of view here where negotiations are a fickle, fickle beast, because if you’re really, really good at negotiating, then you got to know when to take and then when to give back. You don’t want to nick away at a negotiation so much so that the seller is going to try to get out of every deal that you think that won the battle on. Because you can always lose the war.
So, really fun to talk through all the different, I don’t know, processes and deals that we’ve all gone through. And honestly, it’s always nice to have Mr. Greene back and honestly, I think it’s just a beautiful thing to see too long-lost cousins, reunite and chat and chum it up and chop it out on the pod. Honestly, it brings joy to my heart.

David:
I just thought of an analogy that could fit for the negotiation tension that you’re describing. You don’t want to go too hard. You don’t want to go too soft. It’s to do with fishing. So, when I was a kid, my dad would take me fishing and I would always ask like, because I’m just always in a rush to do everything, “Why can’t I just overpower the fish and just reel it in when it’s on the line?” And he would say, “Because if the fish is swimming away and you are trying to reel in, the line will snap and you’ll lose the fish altogether. At the same time, if you don’t reel in and keep the line tense and there’s too much slack in the line, the hook can come out of the fish’s mouth.”
So, fishermen, when they get a fish on are playing this game where they’re trying to keep tension on the line so the hook doesn’t come out, but not so much the line breaks and negotiating is a lot like that. You want to get every single dollar out of that deal that you can, but you don’t want to push it so far that you actually lose the deal altogether and that fish gets away. What do you think, Rob? How did I do?

Rob:
That’s actually really quite masterful. I was like, “All right, it’s going to be a pretty good analogy.” But that is exactly… dude, you have coached me. You have helped me master this art more than you could ever know. I appreciate it. That’s a good analogy right there. I’m honestly surprised it wasn’t a jujitsu analogy, but fishing, that’s good. That’s left field for me.

David:
I was just thinking all of our hunter, fisherman audiences is screaming in their pickup truck right now. It’s about time. I don’t know about that jujitsu stuff, but I understood that.

Rob:
Oh, that’s good.

David:
Well, we are going to get to the show very quickly. Before we do, today’s quick tip. Consider using the BiggerPockets agent finder to find an agent for yourself, to help with negotiating. Now, when you’re doing this, I recommend looking for an agent that is also an investor, not just an investor-friendly agent, but an agent that owns property in that area that you’re trying to go. Even if they’re not the smoothest, they don’t have the nicest car, their headshot doesn’t look the best. If they own property in the area, they usually have a big advantage over an agent that only represents other clients. Part of the reason that you want to use a high-volume agent is they have a lot of experience. That’s what you’re really going for.
But if your agent has that experience through buying houses for themselves, they don’t have to sell 400 houses a year to get it, so BiggerPockets can help you with their agent finder feature. And the cool thing is the agent will probably be familiar with a lot of the same vernacular and vocabulary that you are using, because they’re in the BiggerPockets ecosystem as well.
Rob, BPCON is coming up. It is only a couple of weeks away. How excited are you for this big event?

Rob:
I’m really, really, really excited. I thought it was going to be like 1000 person conference. And then, I found out it was like a 2000 person conference. And then, I found out that I think we’re sold out. It’s going to be a packed house. So, please approach us. Take selfies with us. Give David a big hug. That’s his favorite thing. He just likes hugging everybody. And come say hi and let’s chat for a bit.

David:
Wow, Rob. Okay. You said a very nice thing about me in the show. So, I’m going to let that slide, but the people will do that. You’ll see me fighting my way through the crowds with people being dragged behind me as they got a leg. And they’re like, “Rob said to love you because no one else does, David, and I need you to know you are loved.”

Rob:
It’s going to be a perfect opportunity for you to finally put that Brazilian jujitsu to use.

David:
That’s hilarious. I’m going to be like John Snow fighting through incredible White Walkers using jujitsu. All right. Without any more ado, let’s bring in Jonathan, and let’s learn something. Jonathan Greene, previous guest on episode 584 of the BiggerPockets podcast, and you did such a good job we had you back on. Welcome and good morning to you.

Jonathan:
Good morning to you guys. Thanks for having me back. I’m excited to be here again.

David:
So, if you haven’t listened to our last show, please go back and check out episode 584, where we got into some really good nuanced conversation with Jonathan about investing over a long period of time, having a sustainable career and really doing real estate, what I would call “the right way”, looking at every property uniquely and trying to figure out what is the highest and best use of this property. What is the story, this property tells, what’s the vision for how you’ll execute it? And one of the concepts that we got into was this idea that real estate is part art and part science.
Now, we all understand the science part. That’s writing numbers using a spreadsheet, calculating things, analyzing, trying to project, but there’s a whole other part of real estate that is more art. And that was fascinating. And we’d like to expand on that with you today, if you don’t mind, Jonathan.

Jonathan:
Yeah. I’d love that. I definitely have a background in negotiation as a prosecutor, so it’ll be interesting to let everybody know what I do in terms of analysis and in terms of my hardline negotiation long term, which I know you guys are familiar with too. So, yeah. I’m excited to get into these topics as well.

David:
Why don’t we start with that? Can you explain how the negotiation element of real estate fits into the art side of the equation?

Jonathan:
Yeah. So, I was a prosecutor for eight years and a criminal defense attorney for two. And I was always doing real estate my whole life, but when I transitioned to real estate as both an agent and more of a full-time investor, I started to look back at my negotiation techniques as a prosecutor. And obviously, you’re familiar, David, with some of these from your background as a police officer and, Rob, obviously in investing, we use these all the time.
But one of the things I think that was most important for me is when I’m negotiating in a real estate deal, the first thing I think of is, well, nobody’s going to prison and there’s no victims, so why am I getting so worked up over this when I spent eight to 10 years, either sending people to prison or trying to make sure they didn’t go there. So, it takes the edge off of it a little bit for me.
And I’ve always had one deal to the next attitude. But I think that incorporating what I know and then using principles from someone like Chris Voss, it really helps me figure out where the pain points in the deal. And a lot of that to me is listening to what the other side’s saying so that I can use the leverage that I have to combat what they’re talking about.
And I think that’s what a lot of new investors miss. They’re just trying to do a dialogue, but they’re missing the points.

Rob:
Do you feel like you were somewhat of a master negotiator coming out of the gate, or do you think that this is a skill that even as someone that was really experienced in your field, it really is something that you have to develop over time? Obviously, some people are going to be more naturally gifted at it, but is art of negotiation, if you will, is that something that anyone can master?

Jonathan:
Yes, definitely. And it’s a great question. And I did come out thinking I would be better than others and I was wrong. My negotiating skills were great, but I was still negotiating like I did as a prosecutor when I started, which is hardline, hardline, and making sure I’m drawing lines in the sand and then pulling, which we’ll talk about later in terms of my offers. But I think I was a little bit, if I’m negotiating that way as if somebody’s life is at stake, they’re going to be really off put on the other side. It’s going to come off as too aggressive.
So, I did have to back down the way I did. And I do think by learning from other people, how they negotiate, and again, reading books, listening to podcasts is definitely a way you can figure out. But like I said, I think each deal is different. So, the way that you negotiate with each person is completely different based on what they’re telling you. And if you’re not listing, you’re going to lose the whole negotiation before you start.

Rob:
100%. I’ve always found that the more hard line you are on it, typically it does not go your way. It’s a game you have to play. And I think this is where egos and pride can get in the way a lot of the time, because you’ll want to drive the car here, but then your realtor who might have a little bit more experience or a little bit more know-how will try to guide you. And you’re like, “Well, hey, let me do it my way.” So, I think this is an equally important aspect of negotiation.
And I’m also wanting to know when you’re working with the realtor on your end, do you feel like that’s truly… is it a negotiation partnership that you should probably see eye to eye with your realtor? Or do you make it so that your realtor takes your lead?

Jonathan:
Yeah. David knows this well, because I’ve been licensed for almost eight, 10 years now, but the one thing I remember when I was not licensed and I was agent, I didn’t think they were being hard enough as I wanted to be because they were trying to protect their relationships. I didn’t really understand that then. Some people try to get me to lowball as an agent and that’s not my thing, so I’m not going to do it. But yeah, I do think that it’s a cooperative partnership. The most important thing I think is if you’re an investor and you’re working with an investor-friendly agent, that agent is there to do the negotiations the way that you want, not the way that they want.
And that was a hard lesson for me to learn. And I definitely a couple of times overstep because I was negotiating hard the way that I thought would work, but they weren’t comfortable with it. And look, most regular home buyers aren’t ready for that. Investors are usually more ready, but they’re not ready for the level that I would do on my own. And I have to recognize that. So, I do think it’s a full partnership and you have to be clear on how you want to get to the deal and then take advice or not.

David:
That is a great point, Jonathan. You can err on either side. You can have an agent that wants to make the client more money than the client wants. So, they’re out there, working the deal they would for themselves. We’re going to get every dollar and if they don’t want it, there’s another house. We’ll go find that one. And sometimes your clients are like, “No, I want that house. I don’t need the extra $1,200.” And then, on the other hand, you’ll get clients that don’t really understand and through no fault of their own, the leverage in deals where you sometimes get a deal at such a great price that the seller realizes halfway through the escrow. I’m giving this thing away, you’re not getting another dime.
And if you do push it, you try to put some leverage on them, the whole thing will snap. So then, sometimes as an agent, you’re trying to protect your client. You don’t want to just come out and say, “You’ve already gotten more than you are going to get.” You’d be very happy because now they feel like you’re not on their side. But sometimes that whole, it doesn’t hurt to ask thing, is not true. Sometimes it does hurt to ask.

Jonathan:
Yeah, I agree with that. I have issues with clients only if I haven’t fully educated them along the way, or if they’re just not going to be compliant to like what you said. I like things to be a good deal for everyone, which doesn’t mean I’m not adequately representing my client as an agent. But to me again, based on my background where it was extremely adversarial, someone’s going to prison or they’re not. Really the best deals we all know are ones where everybody gets along. Because if you don’t and it’s adversarial, you may get through a deal, but everyone’s just going to be trying to screw each other, the whole deal over $1000 or leaving stuff in the house.
So, it’s sometimes hard to get one side, whether it be seller or buyer, to understand that, look, if we don’t all work together, we’re never going to get through this deal. And I think that’s part of where my negotiation tactics changed, where I had to say, “Listen, I need to build my relationships with everybody on the other side. And that includes if I’m an investor, I can’t be too hard. But as an agent, I have to work with the buyer as well.”

Rob:
This is so true. There’s always that phrase. You may win the battle but you’ll lose the war. And this happens all the time when you’re actually negotiating the deal, you keep chipping away, keep chipping away. If I’m a buyer, I just keep chipping away and chipping away at that seller, hoping that they give into the negotiation tactics. And if I’m successful, then the first thing I want to do is like, “Oh my, God, I’m the greatest I did it. I negotiated the heck out of this,” but then they start getting other offers because we’re in this crazy, crazy market. And then, when they have four offers that are above asking, a couple of weeks after we’re in the process.
The moment I start making any more demands, then they start not giving in because they’ve already given everything that they can give. And the moment I try to get my way, then they’re just trying to get out of the deal because maybe I’ll lose my escrow money, but B, they might even just get a better offer than the one that I gave them. This has happened so many times.
So, I think that there really is a fine line to walk there and just making sure that both sides can win. Obviously, you want to win a little bit more, but you don’t want to take it all, I personally feel.

Jonathan:
Yeah. I think if you look at the way deals are structured, like if you’re in an attorney state, you’re going to go through attorney review, that’s going to be a little game of ping pong. But then, we go to where all deals go to die, home inspection. And if you get too hardball in home inspection, that’s where everything goes wrong because someone’s trying to get a credit for doorknobs when you should just be focused on major things. So, like I said, my job, I think as an agent and a counselor for investors is to get them fully prepared before they make an offer.
So, we make tons of videos, tons of content to just make sure that they understand we’re not going on a fishing expedition because the deals that die are because someone’s just asking for too much, or you already know that the seller’s going to be unreasonable. And if it’s fully as is, you need to make sure that your buyer investor knows as is means as is. And I don’t want to go in and make an offer with already the understanding, but I can get out of it if I don’t like it, because we’re saying we’re buying it as is.
And I think that’s where there’s just a lot of nuance in that. And we all have to understand it’s going to be a long-term negotiation. Like you said, it will come back to haunt you later if you press them too early.

David:
I can give you a story of how that just happened to me. I had a deal where we got it a ridiculously good price. And then, after that, I came back and I got even more credits and I knew the seller was getting tense, but I didn’t know how bad it was. And then, I hit a point where we couldn’t get an appraiser out there in time for the appraisal contingency. They were all backed up. So, we needed an extension of two or three days on the appraisal contingency. And they said no. And they had the right to blow up the entire deal, which they were incentivized to do because they had felt screwed at every single step and just thought I was taking advantage. And there is no taking advantage in real estate.
The contract is what the contract is. You get what you get, but their perception matters in the way they’re going to make decisions. And so, I had to pay $2500 to get a three-day extension on my appraisal because otherwise, I was going to lose the whole deal. Now, when you look at, I think I got that house for about $250,000 less than it appraised for, so the 2500 didn’t really matter. But it’s an example of how you can see.
Getting too much on one side and imbalancing the equation can absolutely cause the whole deal to topple and then everyone loses. The sellers got to go back on the market. I’d be out my inspection money, my appraisal money, and all the time that I put into it.

Jonathan:
Yeah. That’s a great example of you knowing when to stop pushing. And I think that’s what some investors don’t. They just want to keep, like, you’re up to 50, relax. I myself as an investor try to give something back. We just closed a property yesterday, my business partner and I Jenny, and we have to redo an entire septic. We put that in. We knew that was going to be part of it, but they didn’t want to even get the certificate of occupancy. And we said, “Well, we’ll pay for it and we’ll put up the smoke detectors, but you’re going to sit there when they come.”
And these are little negotiations that helped us as other little things. Like you said, David, you get into it. Something happens the day before, they couldn’t get a freeze authorization on a HELOC. And we have our demo crews set up and we said, “Well, can we still get in?” And we really, really massage that deal on our end. But I do think like you said, you can get to that point and you have to make a tough decision on when to stop.

Rob:
So, Jonathan, obviously, you are analyzing deals left and right all the time, all over the country, doing deals, galore over here, deal city. That’s what I’m going to nickname you right now. So, can you tell me a little bit about your buy box, if you have one, or is everything the buy box? Help us understand what your buying criteria is.

Jonathan:
Yeah. During the pandemic, I really sold off most everything on purpose to just hold and wait and stockpile the gunpowder as we say, waiting for maybe the next six months to 12 months to see what I think is going to be better leverage for me. And I had a bunch of old properties, but for me, I think the thing that I’ve transitioned to this year and the way that I describe it is I’m always looking for assets. So, I like a lot of different things. I’m interested in self-storage. I’m interested in main street commercial, which we talked about in 584. I like flipping, I buy and hold.
I like Airbnb, but I am always looking for markets where I think there’s appreciation. So, I’ve always been an appreciation investor. I don’t really care about flow. I like it, but I’m not banking my history on the cash flow because I don’t have to use as much leverage. So, I think locally, I know all the markets. So, I’m looking for what I think is a project that I’ll enjoy honestly first. And then, I’m hard running the metrics to see if they work for me. And then, when I’m looking at outward deals for myself in other areas, I’m looking for growing areas that can support that investment proposition.
So, if I’m doing Airbnb, which obviously you guys have great experience with, I’m going to go through areas where I think the regulations are either loosening or never coming so I don’t put myself at a disadvantage. And then, for metro areas, I’ve always said the same thing. I don’t like hot areas, because I feel like I’ve missed the big money. So, I take the hot areas, look three towns out and see if that’s a town that’s going to come up and if they’re starting to do flips in that area.
So, I think because I’ve had most every asset class, I’m never looking for something specific, but I do like some oddities. I love two-bedroom, single families. I think they’re really a good asset because you can buy them for much cheaper than a three-bedroom in a lot of markets, but they’re going to rent out at almost the same amount as a three-bedroom because of the tenancy. And I just think those are smart buys everywhere, during the pandemic that the prices went up a little too high, but that was a big mark.
And again, that’s not a viable opportunity for a lot because families aren’t going to mostly move into a two-bedroom. So, you have a unique house that becomes a very good rental in my opinion, as just like one oddity that I like.

Rob:
Sure. So, you mentioned something that would probably be very confusing to most new investors, but you said when you’re looking at properties and you’re analyzing them, you said, “Well, hey, if the cash flow is there, that’s great. I’m not as concerned with that.” Why is that? What does that mean? Because I know a lot of people, they’re getting into real estate for cash flow. They want monthly cash flow that they can use to supplement their mortgage or their W-2 income or whatever that means. So, why is that not something that’s a direct focus for you at this moment?

Jonathan:
I’m going to explain something that I know everybody needs to hear and they probably don’t want to hear. Cash flow can go away quicker than you’ve ever seen anything in your life. So, if you hear everybody banking on 10 houses and they’re all making $100 a month in cash flow, all you need is one furnace to break in one of your 10 units. And you’re not going to make cash flow for six months. The furnace going to be eight grand. So, to me, I just never focused on that as an entity, I like it but I always want appreciation because to me, appreciation is a present.
It’s like a windfall later that you didn’t expect. I like both, but I’m not greedy. So, I think that the lure for cash flow, if somebody says, “I want to build up a portfolio with X cash flow so I can scale out of my nine to five,” that’s highly dependent on the types of properties that you buy. And new investors are maybe buying C-minus houses to start off with. Those don’t cash flow. You may think they’re going to cash flow until everything starts breaking and then you’re in trouble.
So, one of the things that I’m so intent on with new investors, which I’m sure you guys will agree is if you buy your first property and then you’re going to buy your second property before that first property is at max value, meaning you fixed everything that’s going to be a high number later. You’re going to eventually get caught on all of them. And if you do that when there’s a market downturn, you’re going to lose them all.
So, I like people to really fix up that first property. Doesn’t have to be perfect. If you know that HVAC is going to break, you know there’s a big cost coming and you can’t go buy another property because you’re going to get caught on both of them and not be able to pay for repairs on either at that time.

Rob:
Agree, 100%. I think I have still to this day, not really paid myself from the cash flows of my property. I always just reinvest them. And I think you’re right. I think appreciation, that is the thing that I’ve realized, I’m like, “Oh, my gosh, this is really where the wealth is created.” I know you have a philosophy that’s like, you will either make money on a deal or you will make money on a deal. Do you think you could maybe walk us through what that means? Because obviously, that’s like, well, what do you mean by that?

Jonathan:
Yeah. It was funny. We were talking about it before. So, the way that I look at it, I’m never going to buy a bad deal. I don’t think I’ve ever in my life bought a bad deal. I’ve had losses on real estate. They were all my fault or the market conditions. But I buy really smart because I use analysis and what I would call asset hunting and what we were talking about, art more than science. I know based on my history, what the repair costs are in five minutes, barring a sewer inspection and stuff that’s underground. So, when I look at a deal, I’m much more relaxed because I think I’m either going to make some money, which is the make money or I’m going to make a lot of money.
And when I build my spreadsheet to start, I put it at the lowest possible ARV that if I did everything wrong, I’m still going to get this. And then, usually, I make 50 to 150 more than that. And I like not even adjusting the spreadsheet till we start seeing the comps later and we start seeing our repair costs. And that way, what I’ve always called the spread, my spread is either growing bigger for me because I’m cautious about that. So, I go into every deal knowing I’m going to make money. It’s just a matter of how much.
So, even when everything goes wrong like it has, okay, I break even. And then, I consider it like, well, now I get the deposit money back. So, there’s no loss in it for me. If I can get the deposit back money, even on a break-even, I wish I made more money, but at least I have the deposit money and then I just go get another property.

Rob:
Totally. And plus, if you’re a long-term holder of your property too, then eventually you will make that money. It is obviously very possible to lose money in real estate, but if you’re actually holding it for a long time and you’re investing consistently and you’re building up a portfolio, you may have a few stragglers that aren’t really crushing it for you, but overall your portfolio over time should be able to carry that slack. And I know you’ve been doing this for a bit.
I’m curious as someone who is not Greene in the industry, but really quite the seasoned pro, do you still get any level of analysis paralysis, or do you just feel like, you can really take on any deal that comes your way?

Jonathan:
Well, I don’t want to take on any deal, but I have absolutely zero analysis paralysis and I think it goes back to my history in working for the government. We have 300 cases on our table at a time. You have to make decisions on things right away. So, even with my team on market and off market, I’ve always been somebody who can make decisions and not really worry about it. If it turns out I was wrong, which all of us have the investments that we cherish that we didn’t get, I’m okay with admitting I was wrong.

David:
Jonathan, on that note, do you have a form of a buy box? I’m sure someone with your experience doesn’t hold to just one buy box. You can look at every deal and see something. But is there maybe like 60%, 70% of your deals overall have these things in common that you look for that you can share with us?

Jonathan:
Yeah. Right now, I like flipping, but I took a break during the pandemic because the deals just weren’t good enough. And I think the restraint is one of my strengths. I don’t have to buy something, I like to buy something. So, to me, when I’m looking at flips, which is my entity that I like, it’s always about what somebody else doesn’t see that I can see, which I know we did actually talk about in 584 as well. I think that you guys were talking about the property that you might be at now. I think that I understand the spread better because I’m looking for things like the property I just bought, there’s a septic issue.
So, I know that traditional home buyers aren’t going to buy that. They’re not going to pay 30 grand for septic. So, how am I going to leverage that? So, my buy box includes towns that I think have a big upswing. The price point is not a big part of the buy box. It’s more the spread and how much I can see. And what I found is, we used to be doing, we did a lot of formula deals like that were 300 buy-ins, 60 reno and then 60 profit, which was good. But now we want more profit. So, I did 465 buy-in, 180 reno, but I made 200 profit. So, as we scale into buying in the 400 to 500 range, if we do it the right way and we’re identifying the properties the same way our scale to profit is so much more. And then, we’ll move that even further. If you’re buying in my areas in the 600 range, you’re going to put in 2250 and get out in the 12, 14 range.
So, I think that’s part of the analysis too, but that’s really what I look for right now. And I’m always looking at that hybrid commercial properties because I just think commercial is where it’s at now. There’s so much available that the leverage is huge to buy commercial with commercial mortgages if you want.

David:
So, you’ve got a different buy box for the different assets that you look at. If this is a flip, you said, I want to be right around 400 to 500 with hopefully less than 200 in construction. I want to profit on 150 to 200. Those are gross numbers that someone else can look at and say, “Okay, I can try to find something that fits within that.” And it cuts down on the hesitation of what should I do and the overthinking. And then, like you said, in commercial, I want to be in commercial, I want to be buying it for less than what it’s worth right now because I think the market is soft and I can go in there and get a better deal. So, maybe 20% under market value, you’re going to be excited.
That still functions as a buy box. It doesn’t have to be this much price per square footage in this part of town with this is owning. Sometimes, it’s just the amount of meat on the bone is what you start with. And then, you figure it out from there. So, in your opinion, you work with a lot of new investors. You’re very active on the BiggerPockets forums, helping with people. Why do you think that just the generic standard newbie who stumbles upon this podcast is really excited, likes everything they’re hearing?
Their dreams are flying out of their head. You could see it happening of everything they want to do in life, but they’re stuck in analysis paralysis when it comes to getting started buying their first deal. What do you think is causing that in that demographic I just described?

Jonathan:
So, I’m 100% sure that this is the reason every single time. There may be other factors, but this is it. They haven’t seen enough homes. Most of them haven’t seen any homes when they’re in analysis paralysis or then it just becomes, I’ve seen one or two, and I’ll grant you that it is very hard as a new investor to get a realtor if you’re not licensed to just show you a bunch of homes when you’re barely qualified or using an FHA. A lot of realtors aren’t going to do it. But unless you’ve seen 15 or 20 homes, I don’t know how you’re making offers on homes.
You don’t know anything and you’re going to lose money because you can’t rely on just the realtor that you just met to make sure that they have your best interest at heart. They want to make a good commission so they’re going to tell you, and I’m telling you, I run a team of 40 agents. This is not all agents, but this is common. They want you to pay the most or they may want to tell you, you want to get a property. And if you’re desperate for a property, that agent’s going to become desperate for the commission.
So, desperation is what will kill you, but not seeing enough homes every single time, every time I’m in the forums. And somebody says, “Oh, analysis paralysis. I don’t know what mentor to use.” Or I’ve been researching and running the numbers on so many homes. I ran 100 deals this week and I said, “How many did you see?” And they always say zero. And that to me is everything because we’re talking art versus science and art is, I need to be in the house, I need to understand how a house is constructed.
I need to understand where to look, always in the basement, what I can see, everything else that’s cosmetic. You need to find the things that are going to cost you money or later, which are the hard things to find. And I think if you’re not looking at homes, you’re just not trying hard enough to be completely honest.

David:
What about when you’re looking at a home, starter, brand new, okay, I know I need to go look at homes. Give me a playbook of overall what you think they should be looking for. And then, Rob, I’m going to throw the same question to you.

Jonathan:
Yeah. Again, I look at this question as me being the agent as a guide for a new investor, a new home buyer. I’m going to take them through every single thing that I see in the house. I’m not going to say, this is the kitchen, this is the living room. They know that. I’m going to immediately start what I call future casting, which is helping them prepare for the future. So, if I see something in the ceiling, you guys know this, you see an evidence of a leak in the ceiling. The first thing I’m going to say is, “Hey, look, you see that discoloration on the ceiling, that looks like a leak. But most times, people repair the leak in the ceiling and then they just never paint over it because they’re lazy.
So, I know that looks like an issue, but later it may not be an issue so don’t get too worked up over that.” And I’ll do that through the whole house. But my biggest focus is away from cosmetic issues and onto all the serious issues. Like in New Jersey, a lot of 1900s, 1850-type homes. So, we see a lot of sloping. I can tell the sloping right away. And then, the first question is like, look, sometimes this is settling. And sometimes this is a foundation issue.
In five minutes, when we’re in the basement, we’re going to look at the beams and the structure and see if there really is an issue. And if not, it might not be a structural issue. Can these be repaired? Yes, but they’re not really for first-time novices. And then, we spend a majority of our time, honestly, in the basement where they’re bored because everybody likes to look at the cool cosmetic stuff, but I’m opening every door. I open the electric panel. I’m looking, showing them the hot water heater. If there’s a permit, how old is it? How old is this furnace? Is there any knob-and-tube in here?
And again, a lot of that will fly over their head at the beginning. But then, again, if you’re doing 15 showings before you make an offer, by the time you get to five and then 10 showings, you’re really going to start to understand the lingo. And then, that’s the exact reason why you don’t fall into analysis paralysis because you feel confidence.
Confident people don’t have analysis paralysis because they’re able to go through the data. We probably mind the same amount of data, but like you said, I just know what I want and I’m looking for assets. And if that asset is attractive to me, I’m going to try to buy it but only at the price that I want to buy it for.

David:
Rob, same question. What do you think people should look for when they’re walking a house?

Rob:
When they’re walking a house, oh, man. I guess it depends on the situation, of course, but for me, I think a lot of people tend to… especially in the Airbnb short-term rental space, people are walking it and seeing it for what it isn’t versus what it is. And so, I am always very understanding of what the house is for the price that I’m getting. And so, I understand a lot of the times if I’m buying a house that maybe is a little bit more on the affordable side, a little bit cheaper, and it’s not completely remodeled. What I’m trying to come in and see and analyze is, can I make this place sparkle?
Can I give it a little razzle-dazzle, if you will, with design, with furniture, with furnishings, with the staging? Obviously, what I like it to have, a remodeled bathroom and a remodeled kitchen, sure. But for me, I want to know, can I make a space shine in photographs? Can I really look at a lot of the characters and save a lot of it? Because a lot of people will come in and remodel the character out of homes. And for me, I’m always like, “Oh, that’s such a shame.” But I am doing a lot of long-distance relationships, not really. That’s not true.
I’m doing a lot of long-distance investing. My wife would probably be like, “Excuse me?” I’m doing a lot of long-distance investing. And so, for me, I’m always coaching my realtors to be very thorough with their videos that they’re sending back to me. And I always brief them. I’m like, “Hey, I need you to be very critical of every tiny little thing that you see in the house. I want it to be as if the seller was there in the room, watching you giving me this tour, they would be angry at how petty you were being about all the little things.” And it’s not because I’m using those things to make my decision.
I just really want to know and understand how a house feels. Is there a sag in the floor? Are there walls in a room that are inconsistent? Meaning, some have textured drywall and then another wall is completely smooth. Are there popcorn ceilings? Are the fans updated? Does it smell in there? And I’m really trying to understand the cosmetics because with short-term rentals specifically, I’m not trying to come in and renovate the place. I like to spend less than $15,000 on renovations.
Our Scottsdale place is an exception to this. But typically when I’m going out and buying houses, I like to stay between the $5000 to $10,000 range specifically when I’m buying a house. And so, I just want to make sure that, of all the things that I need to fix up there, it’s very easy cosmetic because I just don’t have six months to renovate a place and then carry out an entire burster, if you will, a burden into an STR.
Because I like to cash flow as quickly as I can on a short-term rental. So, it’s going to depend on the asset class and everything of course, but for me, for where I am in my portfolio, time is everything. And so, I just want to make sure that what I’m buying is not going to require a much heavier lift than maybe swapping out some floors or painting a house.

Jonathan:
Yeah. I just have one follow-up on that, Rob, because I think he made a great point that I know there’s a lot of wholesalers listing and this is really important. When Rob was saying what he wants his realtors to do in the other areas to really find all the things, you hit it perfectly. You want the things that the seller would be annoyed that you’re focusing on. And if you want to be a good wholesaler and you want to turn that into being an investor, you have to take photos of all of that stuff. The best wholesalers are ones that could present us a whole picture as out-of-state or in-state buyers and show us all the things that are wrong with it.
I know what the rest of it is, but if I take the time to drive 45 minutes to something I think is a good deal and then you didn’t show me the structure and there’s 100,000 in structural issues, you just wasted my time and I’m never going to look again. So, Rob’s coaching his realtors to be better, but I think what’s missing, and what we talked about a little bit, it’s more like transparency. If you want to be good at it, you’re never going to win hiding this stuff. Because all of us who are investors, just tell me exactly what it is.
If I know I can trust you, then I’m going to look for it. And I think you can train out-of-state realtors and boots on the ground to look better for you if they’re just looking in the right places.

David:
In your opinion, what are some of the data points that a new investor should know when looking at properties?

Jonathan:
Yeah, the ARV is obviously the most important because you want to know what your biggest potential is if you’re a flip or even if you’re a long-term investor. So, it’s always repair costs really in the middle. And I think that the hardest thing is that almost nobody knows repair costs and it’s very, very hard to learn because you don’t know if people are even giving you the right prices. So, the truth is repair costs only come with experience. And the best way to do that is make friends who are flipping, find out what they paid for to remove a wall, find out what they paid for a full sewer redo. It’s just the really only understandable way to get it.
Obviously, you’re going to look at your taxes and if you’re buying multifamily, you’re going to look at what the insurance and the rent role is for sure. But again, I think that people focus a little too hard sometimes on the numbers and they miss the asset like Rob was saying before. You want to see what’s unique about this property. I love to buy properties that other people don’t understand how they can best use them. Like you said about the one that you bought in California, David, I think.
There’s oddities out there and people just don’t know what to do with them. But understanding the block values I think is really important. One thing I do is always send and look at all the homes’ values on the block. And I think that gives you an idea because you don’t want to be the most expensive house on the block. You want to be safely in the middle and then help them raise that upwards.

Rob:
So, the MLS is one of those places, obviously, we’re going to be going and looking for a deal that is the main place to get deals and there’s going to be houses on MLS popping up every single day. What advice do you have for people that are actually trying to hone in on a specific deal from the MLS? Is that, A, the only place to get a deal or is that where you’re sourcing most of your deals these days?

Jonathan:
Yeah. I buy a lot on the MLS. I’m licensed and run a big team, so I’m always on there. We buy most of our deals on the MLS just because the wholesalers in my area, their prices are too high and we’re not going to pay the spread on that. So, my best tip for MLS, if you’re licensed is this, and if you’re not, tell your agent to look for this, it’s called back on market or BOM. They’re absolutely the gold mine of all properties. People focus on expireds and FSBOs and I don’t really love those, especially now. But back on market means that a house was under contract. They had an agreement and it failed and there’s three different times when a back on market fails.
And it’s very important to identify how many days it was under. This is why. If the deal fails within the first three days, it’s always cold feet. Buyer got cold feet, something happened. They backed out. That’s not a big deal. You don’t know what’s wrong. If it’s about seven to 10 days, it’s always an inspection issue. So, if they say after seven or 10 days that, “Oh, the buyer got cold feet,” it’s probably not true. They did the home inspection. Something happened. One party didn’t agree. So, that raises my eye. But as an investor, I’m excited because I know that that’s going to turn off other first-time home buyers and will help investors.
And then, if you see 30 days or more, that’s always going to be a mortgage failure, commitment didn’t come in. They couldn’t get the mortgage. And those are exceptional deals for buyers, investors because the seller was right at the door, ready to close and ready to get a big pile of cash. And at the last second, the mortgage failed. So, a lot of times, if you just offer what they offered, you can pop right into the deal, everything, paperwork, all set, you can hop on the title and close those deals really quickly. So, back on market is definitely my jam for the MLS.

Rob:
Yeah. I can relate to this one. And honestly, we’re talking about negotiation. We’ll probably get into this here in a second, but David is really quite the negotiator. Most people probably assume this, but I got to see the masterclass in person, I guess, well, virtually on the phone when we bought our Scottsdale place, because the property that we bought out there was on the market for 90 days. And I think it probably fell out of escrow. And we came in with a very aggressive offer. I think it was initially offered at 3.4 and then I think we offered 3,000,050, something like that. So, it was a relatively large reduction.
Plus I think we asked for, I think it was like a $75,000 closing credit and they said, no. They told us to kick rocks. And so, David was like, “Hey, it’s been on the market for 90 days. They’ve fallen out of escrow.” He was like, “Let’s give it a week. Let’s not even respond to them for a week. And we’ll just say, okay, hey, we’ll walk away.” And we did. And we did what he called putting them on ice, if you will. And so, he was like, “Here’s exactly what’s going to happen.” They are going to be annoyed that we came in with this low offer and then they’re going to start perusing Zillow.
And they’re going to start seeing what they could buy with $3 million if they had that large pile of cash. And then, after about a week, they’re going to come back and they’re going to say, “We’re willing to do this deal.” And I was like, “Okay, sure, Mr. Greene, listen, let’s be realistic. They’re probably not going to go with that.” And then, literally, the week later, they were like, “All right, we’ll do it under these terms.” And it was like a slight markup from our initial deal. And I was like, jaw dropped. I was like, “Wow, that is crazy.”
And you’re right, I think this moment comes with the seller where they have this big pile of cash presented to them, and then it goes away. And then, now they start feeling a little bit desperate and that’s what happened here. They probably started looking at what they could buy, where they could retire. What could they do with $3 million? It’s a life-changing amount of money. And that way, when we actually came in with a more reasonable offer, they said, “Yeah, sure. We’ll do it.” And that to me, I was like, “Okay, David Greene is exactly who he says he is, a pro negotiator. It’s true.”

David:
Yeah. You want a Greene negotiating for you. Jonathan was a form of a negotiator in his previous career. Now, he’s negotiating now. And this is one of the reasons why you always hear people say, “You got to get off market. You get all this creative stuff,” And you do see incredible deals come off market. But they come from people with incredible skills that spend an incredible lot of money and time trying to get those deals.
You always forget to work that into the equation that that wholesaler that got that great deal might have spent $120,000 in six months of time to get that opportunity where those of us that are operating on the MLS, just find the soft spots. Man, we can just go in there, grab a fish and come right out with it.
So, since you’re Greene and you’re clearly a great negotiator, what are the skills that you think make someone a great negotiator and how can people start with honing their own skills?

Jonathan:
Good negotiation to me comes from confidence. We talked about it when we were talking about seeing houses and if you don’t have the confidence in your numbers or what you’ve looked at and what the ARV is, you’re going to be a poor negotiator. And the only way that you can attribute or move your confidence to the next level and get that same confidence on the other side with the person you’re trying to buy the house from is by building the relationships. So, I’ve found over the years that the more that I just build one-on-one relationships with sellers, especially when it’s only me in the game, I can soft play that for a year because I’m not in a hurry.
And that usually leads to windfall properties later. Traditionally, my agents, my investor friends always think it’s funny, because I’ll call people for a year and maybe only four or five times will I ever talk about the house. And they always say the same thing, the clients will always say, “Hey, you didn’t even ask me about the house. I’m not ready to sell it. I said, “I know. That’s why I didn’t ask. I figure you’d call me when you’re ready to sell and just tell me what your price is and what I’m doing in terms of negotiation,” as I always want them to lay the price on the table first and never me. Because if I lay the price on the table, what if it’s too high?
What if they were willing to accept less? So, you’ll never ever once in the history, have I ever made an offer first unless it’s in a traditional setting. If it’s off market, I’m always telling them, “Tell me what your number is. If I like your number, I’ll just pay it. I don’t want to negotiate back and forth. That’s boring. If you give me a reasonable number, I’ll buy your house.” And then, they give me a stupid number and I just leave. And I think to be a good negotiator, and I’m sure we’ll talk about this more is you have to be able to walk away.
And that’s the thing that I think the best, that I don’t want the deal, I’d like it, I don’t need the deal. And I like walking away because just like you were just talking about in David’s masterclass on negotiation, sometimes you put an offer down and their ego gets in the way. And they need a week to go lick their wounds and feel bad about themselves and come to the realization that they were never going to get what they thought. And you just don’t bother them during that week.
You just leave them alone and that you wait for them to call you back. And I did the same as you were saying, Rob, was going to happen with David. I won a contest with my best friend and partner in flipping, Jenny, because I did the same thing. I said, “I guarantee you what’s going to happen is they’re going to go take the second offer that’s not ours that’s going to be a market buyer. They’re going to do inspections. It’s going to fail. And then, they’re going to come crawling back. And they did.
But I told them when they came crawling back, that my offer was going to be 10,000 less and they came crawling back. And then, they said, “Well, we want the first offer.” I said, “That’s not how it works. I told you that if you went and used my offer to leverage another, it’s going to be less.” And so, then they walked away again with ego and then it took another three weeks. And then, they crawled back to say, “Okay, we’ll take it now.” And they still tried to ask for more, but we ended up buying that house. And that one, I think I made 200.

Rob:
So, if I’m understanding your route here, Jonathan, just to clarify for me, because you say, “Hey, give me your number. If I like it, I’m going to pay for it.” And then, if they give you a dumb number, you’re like, “Yeah, okay. It’s not even worth it.” If it’s in the wheelhouse, if it’s at least in the wheelhouse, will you negotiate it if it’s maybe a little high but it’s not stupid? You’ll be like, “All right, let’s work through this.” But if they’re so highly-priced and it’s a really dumb number, that’s not even worth nickel and diming them down to the price that you actually want. Is that about right?

Jonathan:
Yeah. I wouldn’t say that I’m mean, but I don’t like to have my time wasted. My time is pretty valuable. So, if I go out there and I have a good conversation and then they throw me a price, I know it’s worth 450 and they say they want 700. I just say, “This was a waste of my time, but thanks, please don’t call me again.” And I just leave. They will call obsessively over weeks and I’ll never answer and never contact them again. But yeah, if they’re in the ballpark, my first question always is how did you arrive at that number? And it’s always, “I just pulled it out of the air.”
So, I’m already prepared with all the comps and I know what’s sold in the neighborhood and what the repair value is. So then, when I say that, “That’s okay, but where did you come from?” And they say, “Nothing.” And I said, “Well, let me tell you where I got my number that I’m looking for.” And then, that’s when I use my number against them. I usually don’t go off my number much. I mean, look, if someone’s nice and they’re negotiating fairly and they want like $5,000, I don’t care at all. That $5,000 is not breaking my renovation.
But I’ll be very clear if I give you what you’re asking for, you’re going to sign right now. We’re going to go into attorney review. There’s no you get me to agree and then use it to leverage other offers. That makes me walk away every time. And again, the strength of negotiating is not letting people screw you around because you’re desperate for the property.

David:
You hit on another good point. And it’s that you need to make room for the emotions when you’re negotiating that when we as the investor come in and we say, “This is our number that works. It’s very logical, rationale. We’re operating out of our neocortex.” The seller is probably light years away from understanding the deal from our perspective at that point. They still have these pie-in-the-sky dreams. My neighbor’s house sold for this much. Well, I need this much because I have to go do whatever. And they think that their needs somehow equates to their asset that they own.
And time does a nice job of marinating emotions. The knee-jerk response, a lot of sellers will give you will change over three to four days of not sleeping so well, because they’re not sure what’s going to go down. So, I love your method that you have this number in your firm and that if they come back to you again later, it’s going to be a little worse. They come back to you again later, it’s going to be a little worse. It eliminates them feeling like they’re in a position to jerk you around. You’re actually the prize. You have the money, you can get them out of this problem that they have, and they’re going to need to play by your rules.
One of the things I’ve heard you mentioning is just urgency in the situation. Can you briefly describe how urgency in your offer makes you more effective?

Jonathan:
Yeah, it’s what you said. And I don’t use it every time. I use it when I think the other side is trying to play games. I’ll put a 24-hour window, but I love to tell people what the number is going down to so that they’re very clear on the terms. So, if I say my offer’s 480 today, if you don’t answer within 24 hours, the offer’s 470. If you ask me after that, the offer’s 460 and I won’t negotiate it. So, these are the terms, you don’t have to like them. You can never call me again. But if you call me after 24 hours, you’re not getting the same offer. There’s no excuses, I had to do this or that.
I don’t care about that because I’m just trying to buy at the right price. And the way that I always describe it to people is this. I’m pushing a pile of money on the table over to you. And most of my offers are cash. So, I’m really pushing a pile of money on… it’s sitting in front of you. If you want it, take it right now. If you don’t want it and you ask me to push the money back, I’m going to push a little bit less back next time because you’re wasting my time.
I’d like to come to a fair agreement, but also, this is just how it works. And again, they may be emotional and I am okay with understanding that, but I’m an investor. I’m not here to hurt your feelings but I’m also not here to waste my time.

Rob:
This reminds me of that iconic scene in the cinematic masterpiece Dodgeball when Ben Stiller is like, “Have you ever seen $50,000 in person?” And he opens a big briefcase and it’s just $100 bills that’s like an inch tall. You should try that. I hear that that actually works all the time too, actually bringing that to the table. It’s got to be in a silver briefcase though.

Jonathan:
I’m doing to work on that.

Rob:
Awesome. So, I got to say urgency for sure is one of those things that, oh, I love to use it and I hate when it’s used against me, because it works, in this market, especially. When you’re talking about looking at MLS deals and they’re like, “All offers due by Monday, end of day.” And it’s like Saturday morning and the house was just listed and I’m just like, “Oh, come on. I can’t even eat my breakfast. I got to go analyze a deal right now.” But it works. It really does work. When there’s a deadline, it causes you to mobilize. It causes you to put pressure on the realtor, it causes you to contact your loan officer and really get all that going.
I can definitely see how that’s a negotiation tactic that can work. That’s something that you do on a personal level, but even as someone who’s representing people as a real estate agent and with your team and everything like that, are there any other types of urgency tactics or strategies that you’re using on a grander level?

Jonathan:
Yeah. It’s really modified because in a seller’s market, you have to know who has the leverage. So, if I’m representing buyers in a seller’s market, I have to know that they have the leverage. And I can’t say, if my clients are like, “Well, I want them to respond by tomorrow.” You’re like, “Look, that doesn’t work right now. You don’t have the control.” So, what you want to do is find out everything that the seller needs and make sure you incorporate that into your offer, whether or not you’re the highest price is whatever you’re willing to do on price. But I always find out if there’s no guidelines, everything that the seller wants, closing date, what things are important, if they need a use and occupancy.
And so, my offers always have everything that’s a seller requested. So, even if it’s less, I’m using that as a tactic. So, on urgency, if they need to close earlier, I’m making sure my clients can close earlier. If they’re doing it on some other level, I’m just trying to match what they want. But I think we’ve been two years in a very, very hot seller’s market. So, it’s very hard as a buyer to use urgency. And I think people try to overuse it and not understand who really has the control, which is sellers. It’s changing now. And I think it’s going to be real nice for us who’ve been wanting to use it and now can use it again.
But you have to remember that, similar to what David said before about maybe they just are emotionally attached. Sellers are still thinking that the prices from three months ago are valid, we have to slowly show them that it’s not by letting them sit on the market a little. And like we said, nothing more than days on market to get a seller start to come around to your offer. And sometimes you can just be nice. And sometimes I use the reverse urgency, which is, look, if you want to use my offer to leverage other offers, go for it, but nobody’s going to close the deal quicker and easier than I am.
So, I’ll leave it out there for a week. But if I don’t hear from you in a week, I’m never going to offer it again.” So, that’s it. I use it modified and that’s to put pressure on, but also be like, “Hey, I’ll give you a week.” So, there’s different versions. Like I said, I’ve used it to hardline, in situations before and now I’m learning to really listen to who’s on the other side, including agent, seller, what they need and then leverage that as best as I can. And if I can use some type of urgency, I will, but it’s been tough when sellers are in control.

Rob:
Yeah. Awesome, man. Well, as we close out, I didn’t want to end the podcast without talking briefly about your 25 Malvern negotiation in Verona. Can you tell us a little bit about that story and all the juicy details there?

Jonathan:
That’s the one that I actually was talking about, but the dynamic was so interesting because it was between not just the agents. Agents had an ego. The sellers were a little bit crazy and they had an ego. So, it was listed for like 599. And it sat on the market for maybe 30 days. We went and saw it. I made an offer of 465 and they were appalled. I mean, just appalled. And this was a good offer or maybe it was. I might have offered higher. I think I offered maybe 475 at the time. And they said, “Oh, well we have other people interested.” And I said,” Who else is interested?” And they said, “Oh, regular first-time buyers.”
And I said, “Come on.” I said the house needs 40,000 in structural minimum. And remember, most real estate agents have no idea about anything renovations. It definitely needed 40,000 in structural. I said, “You’re going to get to inspection. It’s going to fall out.” And then just like you said with David, they said, “No, our client is offended by what you said.” And I said, “Well, I’ll leave it open for today. And then if not, I’m going down to 465.” And that’s when they got even more offended. They ended up taking the other offer. They did the inspections, it went exactly how I said.
And two weeks later again, they called back. And it’s what I was saying before, I said, “Look, it’s 465.” And they were then again, incensed that I wouldn’t give them the 475 that I originally did. So, I said, “Okay, well call me in three weeks when it doesn’t sell again.” And it didn’t sell for three weeks and there were co-agents on the transaction. So, the one that I was dealing with the whole time never called me back, but his wife called me back and said, “Can you please give us the 465?” And I said, “Sure.”
And I made about 180 or 200 on that. And it was a tough renovation, but I was right about the structural. And I was right because I did my due diligence and most people aren’t doing their due diligence.

David:
You were also right with how you foresaw it falling out of contract if they went with the other buyer. And it’s half satisfying and half frustrating when you can see exactly how it’s going to play out and you can’t just get the other side to skip ahead and do it. You have to wait for the painful dominoes to fall before it finally comes to where you knew it was going to come in the first place. But that’s why you want an agent like Jonathan representing you. Because when you’re thinking, “No, no, no, let’s give them the number they want.”
Nope, let’s hang on. Let’s do it this way. And if somehow it does get through inspection, there’s another house we’re going to find. And you just keep that steady pressure. And eventually, you will take these deals down.
Thank you very much, Jonathan. I really appreciate not just for being with us on the podcast today, but for the work you’re putting in on the BiggerPockets forums and helping fight the good fight of others building wealth through real estate every day. Did you have any last words before we let you get out of here?

Jonathan:
No, I always appreciate being on. It’s always a pleasure to talk to you guys. And I was just going to pub my new podcast when you’re ready.

David:
Yeah, yeah. Let’s hear about it. Where can people fight out about you?

Jonathan:
Yeah, spurred on by years of listening to BiggerPockets and loving this, I started my own podcast. It’s called Zen and the Art of Real Estate Investing. As of today, when we’re recording, the ninth episode came out this morning, but it’s about the mindful approach to real estate. And we’ve talked about a lot of that and that includes these type of negotiation techniques, because I think that investors can get so much overwhelm of information.
You can get like 50% say yes, 50% say no, but if you’re mindful about the way that you approach real estate, which is really all the three of us have talked about on this podcast. I think that you’ll just find it a lot easier to get through. If you approach mindful, you’re going to have less analysis paralysis, because you’re going to do the work to get to the right parts.
But again, thanks so much for having me on. I always appreciate being on BiggerPockets. I’ve been around the site for so long and I still enjoy being in the forums, answering questions and taking inbox messages, and returning them when I can.

David:
Well, thank you for what you do. And, Rob, thank you for being here with me today. This was a great show. I appreciate you sharing the wisdom that you did, Jonathan, and we hope to see you again. I’ll let you guys get out of here. This is David Greene for Rob, cool as cucumber, Abasolo. Signing off.

 

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In This Episode We Cover:

  • Why “hard” negotiations don’t work in real estate and the fastest way to ruin a potential deal
  • Defining your “buy box and looking for much more than just cash flow
  • The foolproof way to guarantee you’ll make money on your investment property purchases
  • Why rookies get stuck in analysis paralysis and how simply “seeing” a house will snap you out of it
  • Becoming a great real estate negotiator and giving sellers offers that they can’t refuse
  • The almost too easy way to find under-the-radar real estate deals on the MLS
  • And So Much More!

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Note By BiggerPockets: These are opinions written by the author and do not necessarily represent the opinions of BiggerPockets.