Rookie Podcast 79: 19 Year Old College Student Making $18,000 Per Deal

Rookie Podcast 79: 19 Year Old College Student Making $18,000 Per Deal

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Wholesaling is a tough game. Most investors who try their hand at wholesaling quit after only a few months, while those who have the grit to stick it out can end up making a much-deserved profit. Even real estate veterans have a hard time getting into wholesaling, but what about a 19-year old college student without experience in real estate?

Isabelle Zukowski just happens to be that 19-year old college student wholesaler. Isabelle had been working at a local restaurant when the COVID shutdowns started, she was released from her job and had to go on unemployment. While she was getting her unemployment money, she started listening to stock market, real estate, and business podcasts. She was interested in real estate, and when her friend told her about real estate wholesaling, she decided to try it out.

Isabelle joined a bunch of Facebook groups, contacted well-known agents and wholesalers in her area, and started building out her network. After 3 months of hard work, calling 300+ people a day, she landed her first deal. The wholesale fee? $18,000!

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Listen to the Podcast Here

Read the Transcript Here

Ashley:
This is Real Estate Rookie show number 79er.

Isabelle:
I thought all real estate investors were snobs. Everybody’s out to get you. Nobody wants to help. Everybody’s a shark. Everybody’s selfish. I found that to be literally the opposite.

Ashley:
I’m Ashley Kehr, and I am here with Tony Robinson. And today we’re here to talk about my 3,000-mile road trip from Texas and back with two of my kids.

Tony:
You know, Ashley, I think my favorite part was when you posted all of the random questions that your son and them were asking you along the way. I got such a good laugh out of that. Like, do fish breathe? So many random questions.

Ashley:
Why can’t a baby be born legs first? Why does it have to be head first? The fact that they even know to ask that question and some of these things, they were not satisfied with my answers. I felt like I gave answers for some of these things so we had to sit and google them. But one thing I did convince them of is that they are so excited to actually save money now and to buy their own house. So, they have their own little properties that we bought for them that they kind of take care of. We inform them of what’s going on and stuff, but they actually want to start putting their hundreds of dollars into a deal. So, the road trip was worth it for that.

Tony:
There you go.

Ashley:
I know you’re going to spill how you closed on six more deals this week. Let’s hear it.

Tony:
I love it. I love it. Man, things are busy on our side as well. We’ve closed on two properties in the last couple of weeks. We’ve got another one that’ll be closing in maybe three weeks from now. But I think the thing that I’m most excited about is that we’re starting to work on a short-term rental fund. Everything we’ve done so far has been kind of the one-off where we’re buying one, we’re setting it up. But we really want to kind of graduate to where we can buy just like a big piece of land out in Joshua Tree somewhere and just construct 10, 15, 20 short-term rentals all in that big piece of land. So, we’re in the early stages, but I’m super excited to see where that’s going to take us in the future, yeah.

Ashley:
And that’s where we’re going to host the Real Estate Rookie Mastermind Conference at your compound you’re building.

Tony:
There you go. We’ll get all the rookies to drive out to the desert.

Ashley:
Yeah, that’s awesome. I got two properties from one buyer under contract. So, I always like to say, make sure you guys ask if you’re buying one property, ask if that seller has any other properties for sale because it is so worth it to see what they have or even if they say down the line like, “Hey, you know what? Next year I might be selling this.” They’ll keep you in mind. But let’s talk about our guest today. And I feel like we have to hype ourselves up a little bit because our guest today is 19 and, okay, doing amazing things, but also just her mindset and the advice she gives. I mean, she just rattled it off as this is what you have to do. And it takes hard work, it takes determination, and just do it.

Tony:
She’s so mature. She’s so composed. She’s so confident. And she shared the three things she does on a daily basis to help build her wholesaling business. She talks about how she’s built relationships and leverage networking to really get her first few deals done. So, if you want just a really both motivational but also actionable episode, this is the one to listen to.

Ashley:
Isabelle, thank you so much for joining us today. Can you start off just giving a little bit of your background before you even got into real estate?

Isabelle:
Yeah. So, I’m 19. I’m from New York. My parents came here at a very young age from Poland so ever since I was little, I was always taught determination, hard work, building up. My parents are very simple people. I love them to death. They’re the best. So, along with that, I’ve also been playing basketball ever since I was five. So, that’s another thing that I think adds to just learning to work hard.
My senior year of high school, I got a job at a local restaurant. It was a great time. I met a lot of great people, but due to COVID, obviously, that got cut short. But because of my job, I was eligible for unemployment which was great, obviously. I started receiving a sum of that to an 18-year-old is a million bucks but, of course, my parents aren’t investors or anything, but my parents basically told me, “Don’t be an 18-year-old. Don’t blow it.” They said, “Be smart.” So, they told me, “You should start looking into stocks.” So, that’s what I did. I listened to my parents. I started listening to a lot of podcasts, watching a lot of YouTube videos. It was obviously a trial and error experience. I made money. I lost money, but it was all learning experience. But also along the way, I learned that many investors in the stock market also owned real estate. But to me, real estate, it was like an untouchable. I was like, “I’m not going to be able to buy real estate till I’m 35 with six figures in the bank. It’s just not happening.”

Ashley:
Isabelle, before we go into more of your story and getting your deals and starting out in wholesaling, I just want to reiterate to everyone that you are 19 years old, and you are a real estate investor, and you are a college student, and you are making this happen. And I think you’re going to be an inspiration to a lot of people listening, and you’re going to make a lot of people like me jealous that I didn’t start when I was 19 years old. So, just first of all, congratulations.

Isabelle:
Thank you.

Ashley:
And we’re really excited for you.

Tony:
Yeah, not only is she 19 years old, but she just came from an accounting test before she hopped on this podcast with us. She’s juggling so many different things. And I told her before we started recording that I think she was the first person to come from a university exam right into the BiggerPockets’ podcasting room.

Ashley:
And I think the youngest too. I don’t think we’ve had anyone younger than 19, yeah. So, Isabelle, you talked a little bit about how once you started to learn about wholesaling, you did that through reading, listening to podcasts. What would be one piece of advice you could give rookie listeners if they’re trying to choose their strategy, deciding if they should go with wholesaling, deciding if they should go with buy and hold rental properties? What advice can you give there?

Isabelle:
Well, I’m obviously biased towards wholesaling. I think it’s morally a great thing. Like I said, you help all different types of people, and it’s also one of the easiest things, I think. All you have to do is talk. You don’t need to have a degree. I was originally a biology major. That’s what I started off. I started off on the pre-med track. And the thing about bio that I noticed is different about a business and real estate is that I can’t just walk into a hospital right now. I could read every textbook in the world about biology, about the human body. I can know everything possible at 19, but I cannot walk into a hospital and be like, “Hire me.” But with real estate and wholesaling in general, I can have no money. I can have no degree, and the world is the limit with that one. There’s so much opportunity with it.

Tony:
Now, Isabelle, you seem like someone who’s an action taker. And I want to drill down on that a little bit because I think so many would-be investors, they get stuck in the analysis paralysis phase, but it seems like you’re moving pretty quickly. Right? You said you’ve been on several appointments. You’ve got a couple deals on your belt already. How did you move past the educational phase of your investing journey, right, the podcasts, the talking to other investors to actually getting that first deal under contract? How did you not get stuck at just listening to the podcast?

Isabelle:
I mean, I feel like something that usually BiggerPockets and many books reiterate is that fear is what separates those with success and those with no success. Even from talking to regular people, all I hear is yeah, market’s not good. I’m scared to invest in it. People are saying they don’t have any rental properties. It’s always an excuse. They’re scared. What if the tenants don’t pay? What if this? What if that? That’s the problem. So, I thought to myself, “If I take a little action a day, that’s going to become a big action.” There’s that quote, if I become 1% better every day, I’ll be 365% better at the end of the year. I think that’s a great quote.
I think three tips that are an example of these little actions, these little degrees that people could take, the first step is texting 10 real estate agents today. That means just go on realtor.com, type in your city of Elizabeth, New Jersey, whatever, and you’ll get thousands of pages of real estate agents. You have their phone numbers. You text them. Hey, my name is Isabelle. I’m a local real estate investor, yada yada, cash buyer. If you have any type of pocket listings that are out. Be super nice about it. Stay safe, whatever. It’s just something that they’ll have your name in the back of your head because you were nice because you reached out to them. That’s actually how I got my first deal, but that literally takes maybe three minutes a day to text those 10 agents.
The second tip would be going on Craigslist and looking at the for rent, and finding 10 listings a day that the listings are either old or they look like they were taken with somebody’s blurry iPhone 4, just shows that they didn’t put any care into it. In my opinion, if they didn’t put any care into the listing, they don’t really care about the property. They want a easy way out. So, you text them. You’re like, “Hey.” I mean, you message them. “Hey, I know it says for rent, but would you be interested in selling?” If it’s a no, it’s a no. If it’s a yes, there you go.
And then the last thing, which this is actually what I started off with every day, is reading 30 minutes a day, reading a real estate book, reading a business book. I try to fit in two books a week, but it’s just something that I do right when I wake up with my coffee, like a grandma. And it’s something that kind of fuels a fire for me.

Ashley:
I think you’re going to offend a lot of people because I think a lot of people listening probably do that too.

Isabelle:
Well, I mean, it’s not usually what 19-year-olds do when they wake up.

Tony:
That’s true.

Ashley:
Isabelle, can you go back? You talked about pocket listings and I think this is such a great idea to text 10 realtors and ask if they have them. But can you explain for everyone what a pocket listing is?

Isabelle:
Okay. When somebody wants to sell their house, they’re going to reach out to a real estate agent. What if their house looks like garbage? They’re still going to reach out to a real estate agent. Instead of the agent going around, posting it on the MLS, and having that liability, they’ll have these listings and they’ll send it out usually to a group of investors. But by texting them, you’re the first one on that list.

Ashley:
How did you work up the courage to do this? You’re 19 years old. I mean, I still hesitate being the one that has to call and order food or anything like that. I do not like being on the phone. So, how did you overcome this? Is that just because you’re texting them or you are making phone calls and how is that easy for you? Is that something that’s just in your comfort zone?

Isabelle:
First of all, I’m an outgoing person, but I think what’s even more important is just the why that I have for myself. My why is that I want to be financially independent in three years by the time I’m 22, by the time I finish college. So, I know I’m not going to reach that goal if I’m sitting around all day doing nothing. So, I told myself I don’t have to be cold calling for 12 hours a day, just something little every day. And sometimes I do get nervous. Don’t get me wrong. I’ve had people curse me out during cold calls. It’s very discouraging. I just want to turn off my phone at that point. But you just got to keep pushing. There’s got to be that one person.

Tony:
You know, something that I share with my son, he’s 13, and I share this with him all the time is that courage doesn’t mean that there’s an absence of fear. Courage means you push through in spite of your fear. And it sounds like you’ve kind of mastered that whole idea. But I guess I want to break down a little bit more for the listeners when you’re cold calling somebody. Right? Or maybe even that first cold call that you had, what are you saying? Right? They pick up the phone. They’re like, “Hello.” They may be angry. They’re annoyed. Like, who is this person? What are you saying? How are you trying to build that relationship and build that rapport?

Isabelle:
So, I used to, when I cold called people, I would say, “Hi, my name is Isabelle. I’m a local real estate investor. Would you be interested in selling your property?” I’ve noticed that doesn’t really work. People are scared of investors for whatever reason. They think investors are out to get them, top dollar, rip them off, which obviously isn’t the case most of the time. But I think what’s more efficient is just being down to earth with people. So, I say, “Hi, my name is Isabelle. Me and my sister,” I don’t even have a sister, “were passing a property on Main Street. Would you be interested in selling?” First of all, they’re like, “How’d you get my number?” You just try to be nice about it. You’re like, “We looked up tax records. We’re trying not to go through the MLS. We have some cash saved up.” Yada, yada, whatever. You make them trust you more.
Nobody wants to sell their precious asset that they grew up in to somebody that’s going to turn around and make it a cash cow. And you can do that, but they want to hear that you’re going to love their home as much as they love their own home. That’s something that I learned through networking, honestly. There’s certain things that I believe in this business, you cannot learn through podcasts and YouTube videos. As wonderful as podcasts and YouTube videos are, there’s just something about talking to real-life people that really teaches you. For example, I met Anthony from Platinum Home Buyers, which is a wholesaling company in Jersey, and he kind of taught me about the market in Jersey. That’s something that I can’t really learn from a podcast. And same with Elliot Smith who’s Call Magic. He does lead generation. He taught me the ins and outs about cold calling. He’s the one that taught me to make it more personal. That’s honestly something that I haven’t ever really heard in a podcast, but through networking, it made all the difference.

Tony:
I have two follow-up questions, Isabelle. The first one is with those relationships that you built, you named two people that seem to be doing relatively well in the wholesaling space. How did you connect with them? I think a lot of new investors, they all would love to have someone that can kind of walk them through the ins and outs of getting that first deal done. How did you build that relationship with those folks to kind of help you along the way?

Isabelle:
You know what a daisy chain is? I don’t know if that’s a known slang. Okay.

Ashley:
No, I don’t.

Isabelle:
Okay. So, if another wholesaler is selling a property, another wholesaler can’t come and wholesale their property. Right? So, there was another wholesaler trying to wholesale a property on Craigslist and I posted their listing. Now, this was two days after I learned what wholesaling was. I did not know it was wrong. But this guy, Anthony, he kind of jumped in and he was like, “Hey, if you ever have any type of properties you want to move, we can do a split 70/30, and also, by the way, that’s somebody else’s property.” And I was like, “Oh, whatever.” I had a ton of stupid questions for this guy. And he kind of just dealt with them all, and I kind of went from there and-

Ashley:
So, you weren’t afraid to ask him these questions?

Isabelle:
You can’t be afraid. Everybody-

Ashley:
Yeah, and I think that’s so great. He told you nicely you had done something wrong. And instead of feeling offended or getting upset or feeling bad or giving up, you were like, “Well, this is an opportunity to ask him some more questions because he already gave me an answer to one without even asking.”

Isabelle:
Yeah.

Tony:
And the important thing too, Isabelle, is that you guys connected because you were taking action, even though it might’ve been the wrong action. Right? And he’s like, “Hey, here’s a better way to do it.” The fact that you were taking action is what connected the two of you. And I think that’s the illustrative point for the listeners is that, and Ashley, we talk about this all the time. Right? It’s like if you’re someone who’s trying to get that first deal done, you got to start doing stuff. You got to be vocal about what you’re doing, sharing it with other people, talking to other people. And the more energy you create around your desire to become a real estate investor, the more people you meet, the more relationships you build, the more value other people can bring to you in return. So, thank you for illustrating that for us, Isabelle. I love your approach there.

Isabelle:
So, I learned that people love hardworking people. Somebody that’s already up here loves somebody that’s down here that’s hustling, that wants to make it. So, that’s kind of how I met the second guy, Elliott. He has, like I said, the lead generation, the call center. So, I called him. I was like, “Hey, can we set up a Zoom?” And I had an interview with him and he was like, “We’re not doing this for you. You’re not ready for the call center. I’m going to help you.” And he absolutely loved it about me, that I was hardworking and that I wanted to make it. So, like you said, it was all about just sharing your goals with everybody, and somebody knows somebody. Somebody could help you out.

Tony:
I want to go back to one of the comment that you made, Isabelle. You said earlier that you’re driving for dollars. You’re on a lot of phone calls. You have several appointments and you have two deals that you’ve already completed. How many people did you say you had to interact with to get those two deals? Was it five people? Was it 10 people?

Isabelle:
Oh my god. Not even overreacting, I’m on the phone with at least five new people a day. And that might not sound like a lot, but for doing this for like seven months now, it’s a lot.

Ashley:
How long was it until you got your first deal when you started diving in making the phone calls, looking for properties?

Isabelle:
So, I actually, I mentioned before people usually quit at the third month. That third month is when I got my deal. So, the third month is when you hit that blockade and you just got to be like, “I have to keep pushing.” And that’s it.

Tony:
I like that for the listeners because we see all the time where people say, “I’ve submitted five offers and I haven’t gotten anything accepted yet.” Or, “I’ve been trying to get this wholesale deal done for like four weeks now, and I haven’t figured it out yet.” Real estate is really a numbers game as well. And you have to put in the work upfront to see the benefit on the back end. So, for all of the rookies that are listening right now, all of you need to adopt that same mindset as well, that as you step into the world of real estate investing, success doesn’t happen on day one. Success doesn’t happen on day 20, day 30. Success happens at day 90, day 180, day 365. And you’ve got to be persistent enough to see it through.

Isabelle:
Actually, I worded that wrong. By the five people, I meant other wholesalers. As for cold calling, I cold call like 300 to 400 people a day. So, that’s a whole other… Yeah.

Ashley:
Are you using any software or any tools or is it strictly driving for dollars? What is your plan to actually get these phone calls? What’s your sales funnel look like, I guess, or your lead generation look like?

Isabelle:
I started driving for dollars actually, maybe three weeks ago, and my goal is to hit 3,000 of them. But obviously, I mean, I didn’t hit that yet because… I mean, make a list of 3,000 distressed properties, but that’s a lot. It’s going to take a little bit of time. So, that’s one list in itself. But other than that, I’ve been skip tracing non-owner occupied out-of-state owners with any type of tax liens or any sort of thing like that.

Ashley:
Can you explain for everyone real quick what skip tracing is?

Isabelle:
Basically, getting somebody’s phone number and their name, and a little bit more basic information, nothing too crazy, but basic information that you need to make a phone call and know a little bit about their house.

Ashley:
What software are you using to pull your lists and to do any of the skip tracing?

Isabelle:
Batch leads.

Ashley:
Do you recommend that for a rookie investor who wants to get into wholesaling and what are the fees associated with that?

Isabelle:
I honestly do not know the fees exactly. I kind of look at it at the end of the month.

Ashley:
So, it varies depend on how much you pull off the list and then how many skip tracing calls you’re doing off of it.

Isabelle:
I’ve been trying all different types of things. I also have bandit signs up. That’s working okay too. That’s pretty good too, but that’s a little risky. Each city is different with the laws regarding that. So, I think everybody just needs to be careful when it comes to that, definitely. I’ve been doing that and all this while still playing basketball, school, and obviously, balancing my family and friends.
So, this whole experience of COVID, I think kind of taught me that a lot of doors close. Basketball to me was my whole life pre-COVID. It was I’m going to play professional basketball. I’m going to be Division One, this, that, and the other. It closed some doors in a way that I got my season taken away from me, but that kind of gave me more time to start shifting my focus onto real estate and investing, and it eventually fueled my decision to transfer from my college four hours away to a college in New York City which would result in me moving back home so I could attend appointments and all types of those things. So, in a way, COVID closed one door but opens many others. So, I think my biggest advice with all of that is just always look for that door.

Tony:
You’ve got such a positive mindset about life, and there’s so many people that are twice, three times your age that haven’t developed that kind of growth mindset around life that you… I don’t know if it was your parents or-

Ashley:
Tony’s still developing.

Tony:
Yeah, I’m still trying to figure it out myself. But you’ve done such a good job I think of just expressing the mental aspect of real estate investing is so important. You know, you said one door closed, but another door opened. You’re staying persistent with your wholesaling. Just so many things that you’ve commented throughout this conversation, I think speak to that. One thing that I want to just kind of go back to and we probably should’ve started with this, but for the listeners that don’t know what wholesaling is, break that down for us. What does it mean to wholesale a deal?

Isabelle:
Obviously, house flippers out there who need distressed properties, but they just don’t want to put the work in to find those distressed properties because it takes a lot of marketing and networking, obviously. So, what a wholesaler does is basically find that distressed property, figure out the value of that property, and then figure out how much repairs are, plus their wholesale fee on top.
So, for example, let’s say a house is worth 200,000 fixed up. You take a percentage off of that. So, from 70% to 80%, so let’s say it comes down to 160. I think I did the math right. And then you subtract, let’s say it has $40,000 of repairs, brings you down to 120, and then you want $20,000 wholesale fee. You need that property for a $100,000. Now, the house flipper, although a cash buyer, they are going to turn around too, and finding them is pretty easy. Once you have a deal, the cash buyers come. That’s to me the easiest part. You post it on Craigslist, on Facebook, anywhere, they’ll come and you’ll get offers in a day if your property is good. So, they’re willing to give you a wholesale fee, the 10, $20,000, whatever you decide. And then you just sign your contract that you have with the homeowner to them. And it’s completely legal in my market, I’m pretty sure in most markets. Then, yeah, that’s basically it. You just collect the difference.

Tony:
Where are you estimating your rehab costs, right? You’d never done a rehab before. Right? You’re a 19-year-old college student. How do you know what it costs to rehab this property?

Isabelle:
The book, How to Estimate Rehab Costs.

Ashley:
By J. Scott?

Isabelle:
There you go. Yep.

Ashley:
Yeah. That is an awesome book.

Isabelle:
Yeah, that taught me everything that I know. Of course, my dad’s also a contractor, so that kind of helps me out too. But I bombarded him with questions when I first started. How much does this cost, this, that? Can you show me this? He was showing me the furnace in the house. It was crazy. So definitely, and then also going to Home Depot and just getting a feel for how much different things cost, like that. But I think it just comes with experience. And obviously, it’s been too short for me. I don’t know every price. I’m not saying that, but I think I can get a rough estimate.

Ashley:
I think that’s great advice too, is that you’re not going to know right off the bat how much a rehab costs. And so, it’s great to look at who around you would know, who can help you estimate that. So, use your family, your friends. Ask those people, and then read a book like the Estimating Rehab Costs by J. Scott, which is a BiggerPockets’ book. You can find it in the bookstore. Then also going either online or in-store to Home Depot, Lowe’s and pulling up okay so a bathroom. This will need a bathroom in the model. You’re pulling up the tubs around. You’re pulling up the vanity, and just add it to your shopping cart and see, okay, it need a tiled floor. Okay, it needs grout. Add all of those things to your shopping cart. Okay, and a basic bathroom will need about whatever, $2,000 of materials. And then from there, you can ask someone labor, what do you think about this?
So, I think just gathering as much information as you can when you’re estimating these rehabs from people around you and actually going and doing the legwork. Obviously, that’s really time-consuming. It’s adding everything to your shopping cart that you absolutely need. But if you’re not a wholesaler, maybe you want to do a BRRRR, and so you are going to be doing the rehab. You’re going to have to do that anyways so you might as well practice adding those materials to your shopping cart.

Tony:
I just want to add one thing there because what helped me… So, I guess some backstory. We have our first wholesale deal that we just closed on in Joshua Tree, and we had never done a rehab in that market. We had done rehabs in Louisiana where we have our long-term investments, but we had no frame of reference for California. So, what I did was I reached out to other investors that I knew in that market, and I said, “Hey, how much was your last rehab?” And they said, “Oh, $32 a square foot.” “How much was your other rehab?” “$37 a square foot.” “How much was your…” “$29 a square foot.” And I use those as kind of averages to help me say, “Okay, this house is probably closest to this house. I’ll ballpark it at $32 a square foot.” So, for the real estate investors that maybe have no clue where to start, they wouldn’t even know what to put in their cart if they wanted to, definitely reaching out to other investors in that same market is a good place to go as well.

Ashley:
Yeah. That’s really good advice. But just make sure they didn’t do their rehab a year ago when prices were a lot cheaper than they are now. My business partner-

Tony:
Apparently 300% or something crazy like that.

Ashley:
Yeah. My partner’s actually building his house right now. And luckily, he was complaining because he thought over this summer and this fall buying wood was extensive, but he actually feels like he got in at the right time because now it’s even more crazy. So, Isabelle, can you break down one of these deals for us? How you found the property, how you handled the seller, what you did with the contract and how you found a buyer for it?

Isabelle:
The deal that I’m going to talk about was actually brought to me through texting agents which I mentioned before, which I think is one of the most unique and important things for wholesaling. So, I texted an agent. I didn’t think she would respond. She didn’t. And then a couple of days later, she’s like, “Hey, yeah, I actually have something. Do you want to come check it out?” So, I ran my numbers. I told Anthony, the guy that I mentioned before, and he was like, “Yeah, go check it out. It seems like a pretty good price range for that property.” Again, networking. I wouldn’t be able to figure that out without that. So, I went over there with my mom. Now, imagine showing up at a house, 19-year-old girl, and her mom. Like, how can you be taken serious?

Ashley:
Sometimes that can be an advantage though.

Isabelle:
Yeah, yeah. So, I went there. I took pictures. I got a good look at the property and they were asking 165. So, I knew that I needed it for like 150. That was the price range that I just wanted to collect the wholesale fee with the split with Anthony. I just knew that that was going to be what I wanted. So, I went back home. I sent him the pictures. He was like, “Okay, cool.” I offered 140 when they were asking 165. So, then they counted off for me, 155. And then I said, “150.” They were like, “Perfect.” So, I just swooped in. I swooped in 10,000 under what I knew I wanted. You never want to give them the actual price they want because then you know that they’re going to give you something higher. Negotiation is honestly a skill in itself.
So, I got that property for 150. I went back. I set up a lockbox which is just a little thing you buy in Home Depot for 30 bucks. You could put the key in there. I got the key from the owner and I told the owner that I have contractors coming, whatever the story was.

Ashley:
You had closed the property when you put the lockbox on or this was before you closed and they gave you permission?

Isabelle:
No. This was before I closed, yeah. He gave me permission because you have the inspection period.

Ashley:
Okay. So, this was something you agreed with them.

Isabelle:
Yes. Yes. It’s very important to have that inspection period contingency and also oil tank contingency because if there’s an oil tank, that’s a very expensive, I guess, mistake to have. So, I had somebody view the house. We had a couple of people. I sent some people. Anthony sent some people, and I think we had like four or five offers within two days. The property was a seal. So, the highest offer that we had was for 167,500. That’s already a almost $18,000 spread. And then I split it with him and closed on it. And that was that.

Ashley:
So, you assigned the contract. So, you had the contractor on opt saying that you were buying it or you could assign it to someone else. And then before you closed on the property, you assigned it to the new buyer so it was no money out of your pocket.

Isabelle:
Nope, not a dollar. Maybe the 30 bucks for the lockbox.

Ashley:
Did you ever get nervous at all that you wouldn’t be able to find a buyer, and you’d be on the hook for this contract, and have to back out? How did you kind of work through that courage? I mean, we’ve already seen already that you’ve worked up the courage to do a lot of things, but what about this thing in particular? Was it you think having Anthony as a partner to guide you through this?

Isabelle:
That definitely made me feel better because I knew that he knew what he was doing. He’s been doing this for a couple of years now and he just knew what the property was worth. The biggest mistake I think new wholesalers could do is overvalue the property. What if I came in there and I was like, “I’ll give you 200,000 right now”? No house flipper, no cash buyer’s going to buy it for 200,000. So, I think that’s, first of all, an expensive mistake to have, but if you’re going to do that if you’re going to be a new wholesaler, contingencies are very important. Now, I’m not anybody to give legal advice. I think people should speak with a attorney if this is their first time doing this and if they’re doing it alone, but having the inspection period contingency, you could say something like, I don’t know, whatever it is, if there’s something wrong with the house you could back out and just having different exit clauses, I think gave me more of a cushion and helped me sleep at night, without a doubt.

Ashley:
I want to just reiterate for everyone too real quick, just about how you took on Anthony as a partner and you gave him half the deal. I mean, you really did the leg work in here. You found the property. You put the lockbox on. You even brought some of your own buyers. But that was worth it to you because you got to work alongside him to have him guide you as to how to properly do a wholesale deal. And when I did my first property, I took on a partner. I gave him tons of equity. I paid him interest on the money he put into the deal. And looking back now that seems like wow, that was a lot to do, but that was how I got started. That was a benefit to me. I had access to his cash. And even now I’m looking at partnering with someone because they know that industry and I don’t at all, and I’m willing to give them… I’d probably give them 100% and say, “Just let me follow along so I can learn this.”
And then it’s like that saying, you give a man a fish, he eats for one day, but you teach him how to fish and fish forever. And I think as investors, you should think about that as yourself. Don’t be afraid to give up equity in a deal or money in a deal to partner with someone who can really help you, and give you that experience, and that guidance too.

Isabelle:
Exactly. Education and experience is priceless when it comes to real estate. Adding value to somebody else’s life is another thing that’s priceless. Even for Easter, I sent that real estate agent a box of cookies. It was a small gesture but it’s just something that just shows that they’re appreciated. So, it’s adding value, definitely.

Tony:
Isabelle, it sounds like your first deal was a home run, I’d say, in every sense of the way. I have one other follow-up question. How much time passed between your first deal and your second?

Isabelle:
A month.

Tony:
Got it. [crosstalk 00:33:38] So, that first one took you several months to get the first one.

Isabelle:
Mm-hmm (affirmative).

Tony:
Second one happened four weeks later. And I asked that question because it’s not uncommon to see that trend for all real estate investors. Right? That first deal, there’s so much knowledge, and time, and effort that goes into educating yourself, and building up the courage, and pulling the trigger. But once you get that first deal done, second one happens so much faster. Right? It was a very similar situation for me. I got my first deal. It probably took me 18 months from the day that I said I want to be a real estate investor until I actually closed on that first deal. And I had my second deal under contract before my first deal even closed. Right? That’s usually the pace that you see people go at. So, I just want to highlight that it was a very similar experience for you because the listeners need to hear that.
I want to talk about mindset a little bit, Isabelle. You’ve already shared all the ins and outs of the deal and we know how much of a home run it was. But I want to drill down a little bit more on kind of how you’ve approached becoming a real estate investor. If you think back to all of the kind of assumptions you had about becoming a real estate investor before you started, and you compare that to how things actually went, what were some of the misconceptions you had, whether good or bad?

Isabelle:
It’s a good question. I thought all real estate investors were snobs. Everybody’s out to get you. Nobody wants to help. Everybody’s a shark. Everybody’s selfish. I found that to be literally the opposite. Everybody wants to help whoever’s willing to add value to their lives or whoever is just somebody that they’ve been in their shoes. When I hopefully get far one day, I can’t wait to help somebody, like an 18-year-old that wants to start up, that has a passion for it, or that doesn’t even have to be 18. I don’t care, but just somebody that I know that wants this. So, I think that’s probably one of the biggest misconceptions that I had and that proved to be the exact opposite.

Tony:
Real estate is definitely a relationship business, and the more time I spend in the world of real estate investing, the more that idea is reinforced. People willing to help, they’re willing to be giving. But you added a very important caveat is that you also have to find a way to provide value to other people. Right? You provided value to Anthony by bringing him a good deal. Right? You provided value to that real estate agent by allowing her to disposition a property that she couldn’t sell on the MLS. You provided value to the buyer by giving them a deal that they couldn’t find anywhere else. So, even as you’re looking to kind of build relationships with other investors, always focus on what kind of value can you provide to measure that it’s a two-way street when it comes to that relationship.

Ashley:
Yeah, definitely. And even Elliot, the second guy that I mentioned, he needed help with his Instagram marketing and just growing his Instagram page. And so, I kind of took over. He posted looking for an intern. I was like, “I’ll do it. Why not?” It’s all about that. And I think another thing that I forgot to mention for a misconception about real estate is there’s so many creative financing ways, it’s not even funny. I was actually in the process of buying a four-unit. I put in the offer. This was days after I closed my first deal. I was going to buy this four-unit. I was going to get 80% from a hard money lender because mind you, I have no credit history. I don’t really qualify for a conventional loan. And the homeowner offered to carry a 20% note. So, I was going to get this property a hundred percent financed and still producing $3,800 cash flow every month.

Ashley:
Wow.

Isabelle:
Yes. I was going to do that and then Elliot actually stopped me. This was right when I met him. He told me why because I was overpaying for the property, I think close to 75,000. He was like, “Why are you sacrificing equity position?” And so, I would’ve made a huge mistake if it wasn’t for talking to him. A deal like that, with that type of creative financing, it can be done. It’s all about looking at every property and seeing okay, should I wholesale this, should I flip this, should I buy it as a rental.

Ashley:
That’s great advice. And that kind of brings us right into our next segment, the Rookie Request Line. So, hopefully, you’ll have some great advice for our listener, but for anyone that has a question that would like our guests to answer it on the show, you can call the Rookie Request Line at 1-888-5-ROOKIE, and we may just play your voicemail on the show. Okay, Isabelle, today’s question is from Jeff in Austin, Texas.

Jeff:
Hi, this is Jeff. I’ve been a long-time listener. I live in California, Northern California so the market here is a little out of my range so I recently closed on a turnkey place in Texas. And I’m looking to do the BRRRR, maybe some flips to generate cash flow out in Texas. And I’m curious the best way to go about securing a good contractor that’s trustworthy and a wholesaler and the team I need in place there. Once you get them in place that seems like it would be much less stressful and easier to do on a future project. But the first one just seems very difficult to make that leap with confidence. Anyway, any help would be greatly appreciated, and I love what you guys do. Thanks so much.

Ashley:
Isabelle, what advice do you have him for gathering his team, and working up that courage to put them in place, and to take action?

Isabelle:
Yeah, I agree. So, definitely, once you get the first set of I guess contractors, wholesalers, it gets easier from there. So, I definitely agree with that. I think a big part is referrals when it comes to contractors. I’ve never flipped a home myself. I’ve never done BRRRR. I hope so very soon. But I think that when I would begin to do that is definitely asking around any type of contractors who’s the best to do this, who’s the best to do that. I’ve also heard going to Home Depot at 6:00 AM right when the place opens. You find contractors, plumbers, whoever you’re looking for, the real hardworking people that you can tell are… They’ll hustle. They’re not scammers or hopefully not. Yeah, I think that’s a good way to find them.
And when it comes to wholesalers, I think just being able to talk to people, you could get a pretty good feel if they’re genuine or not. I think the more conversations you have, there’s always going to be that gut feeling. This person stuck with me. They seem genuine. I think it’s all about just following that, and having more and more conversations, and kind of being able to diversify who’s more hardworking, who will add value to my pipeline.

Ashley:
Yeah. That’s great advice, Isabelle, and something that I’ve heard very frequently on the podcast from other investors is that it’s not like they google it and they call the first person and hire them either. They’re doing what you said. They’re talking with them, getting to know them. I think that’s great advice and make sure that you’re calling 10 of them, 20 of them, and really feeling them out and telling them what your expectations are, what you want to do, and then seeing what they can do for you, what they offer you without you even asking.

Isabelle:
Yeah, definitely.

Ashley:
Yeah, thank you for answering that. That was great. So, next we have our Random Question segment. So, this segment is just some fun questions that Tony and I come up with and we just pull off the list each week. So, since you said in the beginning, you are an avid book reader and you like to pull books from the BiggerPockets’ OG podcast, what are a couple book recommendations that you would give out to a rookie investor who wants to get started?

Isabelle:
I don’t want to say Rich Dad, Poor Dad. I’m not going to do it. I’m not going to do it. So, I think Vivid Vision. It was a good business book. It was a short book that I read on a plane ride going to Cancún with my family. But it was something that kind of helped me figure out what I want to do in the future. I think goals are very important, short-term and long-term goals. And I think that book kind of expresses long-term goals and it’s a very good read.

Ashley:
I haven’t read that book yet, but I went to a mastermind recently where they had us do the Vivid Vision worksheet, and go through that exercise. And I did think that was very-

Isabelle:
Yeah, yeah. And then the second book, which I’m currently reading, but I’m like halfway through, it’s literally one of my favorites, I’m not even done with it, is Trump: The Best Real Estate Advice I’ve Ever Received. There’s a hundred experts that Donald Trump chose, and I guess he asked them each for their best advice. So, it’s filled with plenty of good things. Everybody’s talking about something different and it provides a lot of value, definitely. Those are two, I think different books that not many people have read.

Ashley:
Is there a negotiating one too he wrote, I think? His right-hand man wrote or something. Yeah, those were good.

Isabelle:
Yeah.

Ashley:
Okay. And then for our last random question, what was something that happened in the last seven, eight months as a real estate investor that discouraged you where you thought… Do you have a story of maybe even a phone call where someone really got you down, and you’re like, “That’s it. I’m not going to do this anymore”?

Isabelle:
This lady intimidated me pretty bad, and it’s not easy for me to get intimidated during cold calling. But I’ve got in cold sell before called all different types of names, it doesn’t really hit me. I’m like, “All right, goodbye.” Like, whatever. But this lady, she lectured me for a good 15 minutes. First, she answered the phone and she’s like, “Yeah, I’m the owner. What’s your name?” And I told her my name and she’s like, “And how do you spell your last name?” I didn’t tell her my last name at first, and I don’t know why. I don’t know why. I should have given her a fake name, honestly, because so then she-

Ashley:
She kind of caught you off guard though, I’m sure, asking for it, yeah.

Isabelle:
I thought she was interested. Most people that write down my name and number are like, “Oh, I’m going to give this to my husband. He’ll call you.” Like, whatever. And she’s like, “And your phone number?” And she’s like, “And your sister’s name?” And now I have to make up a sister.

Ashley:
So, what were some of the things she lectured you on?

Isabelle:
She started asking me about my career. I was like… I don’t know. She started saying all this stuff. She was like, “I’m a writer for HGTV. And I think what you’re doing right now is very unethical, cold calling people.” And I was like, “Miss, I didn’t mean to, I didn’t mean to disrespect you, it was honestly just a genuine question, I don’t want to go through MLS,” trying to be the nicest possible. And she was like, “You can get in a lot of trouble. People will report you. They’ll get you in legal trouble and they’ll…” Mind you, this lady has my name, number, my fake career, my fake sister’s name. Yeah, that was bad. That was pretty bad.

Ashley:
Yeah, I can imagine as you’re going through that having to make up a whole new life.

Isabelle:
Oh my god. I was like, “Yeah, I’m 28.”

Ashley:
Well, maybe she’ll be listening to this podcast episode.

Isabelle:
Oh yeah. That’s going to be embarrassing.

Tony:
Isabelle, before we kind of wrap up the episode here, I want to give a shout-out to today’s Real Estate Rookie Rock Star. So, for all of our listeners, if you guys aren’t active in the Real Estate Rookie Facebook group, you are missing out. There’s so much interaction going on in there, and Isabelle, you talked earlier about the importance of networking and getting to know other investors. That Facebook group is the place to be. I think we’re almost at like 30,000 people which is crazy. But anyway, today’s Rookie Rock Star is Kayla [inaudible 00:45:35] and she closed on her first cash-out refi today, officially finishing off her first BRRRR deal. But they bought the property for $49,000 with a HELOC. They did about 13, $14,000 in repairs, and it appraised for $108,000. So, it sounds like a all-around home run deal for those guys.

Ashley:
Yeah. I want to mention the financing too in here. I was looking, it was a 15 year fixed but amortized over 30 years at 3.75%. So, that’s interesting to me. I haven’t seen a bank that does it that way on the commercial side. I’ve only seen a bank that will fix for 10 years and then amortize over 25. So, we’re going to find Kayla and find out what bank she’s using. Well, thank you so much for joining us today, Isabelle. Can you tell us where people can find out more information about you or reach out to you?

Tony:
Well, my Instagram is Isabelle, I-S-A-B-E-L-L-E with three Es, dot Z. And, well, I’m banned from Facebook. I wish I could give you that.

Ashley:
You have to tell us that real quick. How does that happen?

Isabelle:
I mean, they marked me. Imagine networking to so many people they’ll mark you as a spam.

Ashley:
Oh, so as you kept adding friends and messaging people?

Isabelle:
Yeah, I just kept messaging people and liking people’s posts and commenting like, “Hey, can you email me this?” Yeah, do not do that on Facebook, definitely not.

Ashley:
19, banned from Facebook. Okay. Well, thank you so much. And are you on the Real Estate Rookie Facebook… Oh, you can’t because you’re banned. That was a bad question right there.

Isabelle:
I can’t. I wish I could.

Ashley:
Yeah. So, Instagram, you can find Isabelle on Instagram and reach out to her if you want to find out more about wholesaling or connect with her. She loves to network.

Isabelle:
Definitely.

Ashley:
But thank you so much for joining us. I am Ashley @wealthfromrentals and he’s Tony @tonyjrobinson, and don’t forget to listen to the Rookie Reply on Saturday. We’ll see you guys next time.

 

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In This Episode We Cover

  • Real estate wholesaling with no experience or money
  • 3 tips for getting your first wholesale deal
  • Skiptracing and the best lists to pull for cold calling
  • Building relationships with everyone in your specific niche/space
  • The best way to estimate rehab costs and ARV
  • And So Much More!

Links from the Show

Books Mentioned in this Show:

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