How I made $100,000 in 11 days with a phone and a pen!

45 Replies

I am new to the site, and I am trying to get involved as many discussions as my experience allows me.  I saw the, "Success Story" heading, and a deal from 2009 or 2010 popped right into my head.  

I had been involved in real estate for about 2-3 years at the time, and I was 23 or 24 years old.  I had been working full time as a fire fighter for 3-4 years at that point, and grabbed every extra bit of side work in construction that I could at that time.  I framed houses, did remodels, drove 10 wheel dump trucks, laid asphalt, you name it.  If it was building related and paid, I did it on my days off so that I could squirrel money away for two things... real estate, and traveling.

At this point, I had been involved in some small to mid range real estate deals with some older guys who were looking to get into the game, one of them became wildly successful, and I still consider him a mentor to this day.  We had moderate success rehabbing and flipping along with cleaning up and wholesaling.  The pot was continuously split 4 ways, and we decided that wasn't fair if one or two guys were the rain makers finding the deals.  So we amicably split but stayed in touch, utilizing one another as needed for deals, services, advice, etc.  

I had posted advertisements everywhere I could think.  I literally drove an hour to Cambridge, Ma and found books on marketing in Harvard's book store.  Sounded like a great idea, but what a waste when you hear how this deal came along.  The most simple things are what usually find me deals I learned.  

Im on duty at the fire station one night, and my phone rings.  Its a woman who told me that she wanted to sell her house.  I asked her where she found my name, and she replied, "In your Yellow Pages ad".  To this day, this is the one and only deal that I have ever gotten from the Yellow Pages.  I start talking to her, and going through my questions thinking this is some schmuck who wants 200k for a 100k house.  As I am going through the questions though, I'm realizing there may be a small deal here for me.  She owes nothing on her house, is completely upside down financially due to years of mismanagement, and is chomping at the bit to sell. 

I grab my laptop as she gives me the address, and look it up on the map.  Im stunned when I look, so I ask again to make sure I have it right.  I do.  This woman owes nothing and is looking to get $130K for this house, but, because she answered my questions, I now know every single thing wrong with the house and have a pile of ammo to negotiate with.  

Long story short, in a ten minute phone conversation, I get her to agree to $60K.  Yes, 60K.  She owns a 700 square foot cottage in the Town of East Providence, RI.  Here is where it gets interesting.  EVERY SINGLE OTHER HOUSE ON THE STREET WAS ASSESSED AT OVER $400K.  This house sat on the waterfront in an area where all of the beach cottages were bought up by doctors and lawyers, and they built huge houses with large sets of stairs that went down to the water where your town provided boat mooring waited for you.  Literally, a monster of a house sat on either side of her dilapidated and neglected cottage.  Did I mention that her lot was also the largest on the street also?  By far!  

The second I got off duty in the morning, I changed my clothes and raced over there to sign her.  In the time between the signing and the title being completed, I had to find housing for this woman who was completely unhygienic, smelled of wet dog, and never cleaned her house once.  But, I found her an apartment that allowed her to take her Husky. I paid the landlord, first, last, and security on her behalf (which came out of her proceeds).  I paid to get her son's car fixed because he had no job or money (no he wasn't 17, he was a grown man).  That money came from... you guessed it... her proceeds.  

So after jumping through hoops, we close a few days later.  I see the potential, so I put up 3 smoke detectors, had someone clean it out and get it to a broom clean condition, and I had a tree company come and aesthetically trim the trees so that you could see the water.  Underbrush was removed and the lawn was cut.  Finally, it was time to call the real estate agent who knew to come right at sunset for the picture.  The listing picture didn't even have the house in it.  It was just the view from the backyard.  

Not even a week later, at the closing table with a wholesale cash price of $160,000.  So in reality, I made $92,000 all said and done, not $100k after everything.    

The most important part of the story though.  I look at that as a complete failure.  Yes, it was a great confidence booster for a young kid to put that together and actually pull that off.  Yes, it solidified some respect for those who told me I'd never make it in this business and that it was a pipe dream.  I was too young, too this, too that.  I believe that boundaries are made to be broken.  My absolute favorite word is CAN'T because I love making the people who say it to me eat it.  I don't mean that in an arrogant manner, but I know that if I work hard enough at anything, I won't let any obstacle stand in front of me.  Why was this a failure?  They aren't making any more water front property, and I didn't play the long game. I acted my age and took the immediate cash out.  

I have failed a million times, and that is why I succeed.  It took me 2 years to realize that deal was a failure, but when I did, thats when I got good at this.  Every mistake I make and every can't I hear pushes me harder.

Im a popcorn eater Brandon (watch from sidelines)...how was it a failure?...I don't get it...because it was worth $400k and you sold for $140k?

@Brandon Ingegneri
nice job,i hope i can fail this badly soon, i am sure you think you left a lot of money on the table but you also put lots in your pocket,now its time to move on to the next deal 
good luck 

@Tara Myrick .  This deal while even though a financial success especially for where I was at the time in my life, was a failure in that at the time, I didn't see the long game.  I was impulsive and so excited to see that huge check that I got tunnel vision.  I owned that property outright.  If I held onto it for a couple of years as a rental, I would have gotten every penny back.  I then could have done a minor rehab on it or small addition and made a more substantial amount of money.  Today, I keep nearly everything and only flip 4-5 houses a year.  My entire game plan changed, and if I had been more patient, thee would have been a more impactful benefit.

oooooooooh...that does make sense...live & learn...BUT...you DID make a deal...you DID put in the work...you DID make a profit...congrats to you for making it happen...

Originally posted by @Brandon Ingegneri

Not even a week later, at the closing table with a wholesale cash price of $160,000.  So in reality, I made $92,000 all said and done, not $100k after everything.

For those looking to hit that first homerun, how can they then parlay that into long term success? How did the next year play out, then the next, in order to get you to this point 5 years later?

Brian Spatz, Real Estate Agent in NJ (#1541835)

That is an awesome question @Brian Spatz . In all honesty, I remained casual investor for another year or two. I kept trying to find that home run deal but learned that it is way better hitting doubles and triples time and time again. I scored a super cheap rental that I bought for $25k. I then renovated the entire house and was all in around $75k. This was owned free and clear from the money I made in East Providence. This house rents to the same tenants today for $1250 per month. It's nothing special. 2 bed, 1 bath shotgun ranch. Less than $1000 square feet. 

I learned how to market myself and create a reputation for following through on business. I built and built the model I wanted and worked on building a business. Only in 2014 I stopped doing construction on the side and real estate became a full time gig in addition to the fire department. Between 2011 and 2014, I cherry picked deals and only took safe bets. Only when I pulled the trigger in early 2014 on a gut feeling in one of the worst areas of RI did I learn that a calculated risk is okay. Since then, my partner and I have taken our construction knowledge, our real estate experience, and nurtured the relationships we have made. In my career, I have bought over 50 properties. We currently own a number of multi family properties and manage many more. 

My advice. Don't be scared to pull the trigger. Feeling a little uncomfortable is okay. Follow your gut above all else and don't forget to invest heavily in your network. Build the infrastructure you need where everything you need is one phone call or text away. The only way to do that is to realize that it takes a lifetime to build a good reputation and 5 minutes to ruin it. 

@Brandon Ingegneri Congratulations such a great story! Wish you much success on your future deals. Patience truly pays big in this game. Good Luck and Welcome to BP!

Azeez K., Real Estate Agent in GA (#360027)

@Brandon Ingegneri sounds line you've done a lot of really great deals, keep up the good work! Great to see progress in RI.

@Brandon Ingegneri

Welcome to BP! I love your story. I understand what you mean when you say you failed. Just know that you also "succeeded" when you helped at least two people ( and a pet Husky) in the process. (even though it came out of the proceeds) And now you have helped me and so many others who view your post. " If we view our mistakes from a positive perspective we learn from them as well as teach others."  And this is what you have done. Thanks Brandon! Much success to you!

Sounds like an amazing first deal.  I think the only thing holding me back at this point pulling the trigger on my very first is being comfortable enough in my estimation and number crunching... I see you say to follow your gut but I am sure there is an underpinning of being able to mentally go through the numbers.  Of course your gut feeling was used many moons into your investing career so you had a better handle on the situation.  Can I ask your negotiating process on that first deal?  Did you have the number of 60K set in your mind as a solid estimate or did you just throw a half off number from the sellers original price?

@John McConnell

This was probably my 7th or 8th deal at this point, but I believe this may have been the very first one I did 100% on my own. Negotiating is something people naturally have or they don't I think. You have to be quick. The best piece of advice is talk less and listen more. They want to talk. All of it is used to pitch your case. At one point I had her down to 30k, but she flip flopped. I knew 60k was a good deal, so I was just concerned with getting things locked up. 

I like quick checks too, but the real money is in the long game.

Thanks @Brandon Ingegneri ! The main reason I ask is I feel a lot of the property I am looking at is overpriced but the majority of the property I'm looking at is on the MLS and as of right now I'm working with an agent looking (trying to multiply my time I guess). I'm hoping the fall/winter will drop prices a little. I will probably just have to calculate a little higher than average vacancy among other things. I just love the fact that I can interface with people like you who have some time invested and know what to look for. Much appreciated!

Originally posted by @John McConnell :

Thanks @Brandon Ingegneri! The main reason I ask is I feel a lot of the property I am looking at is overpriced but the majority of the property I'm looking at is on the MLS and as of right now I'm working with an agent looking (trying to multiply my time I guess). I'm hoping the fall/winter will drop prices a little. I will probably just have to calculate a little higher than average vacancy among other things. I just love the fact that I can interface with people like you who have some time invested and know what to look for. Much appreciated!

 Every offer should insult the seller. If they aren't insulted, you aren't low enough. 

I think I have heard that somewhere! Lol good morning.have a great weekend!

Brandon, thanks for sharing your REI deals details and tips!

Best,

Couldn't you have put money into the house and sold it for $300k+?

@Brandon Ingegneri Great success story, thanks for sharing. And I agree that the greatest takeaway from your experience, is what you learned (call it what you will)!

-Ben

Originally posted by @Brandon Ingegneri :
Originally posted by @John McConnell:

Thanks @Brandon Ingegneri! The main reason I ask is I feel a lot of the property I am looking at is overpriced but the majority of the property I'm looking at is on the MLS and as of right now I'm working with an agent looking (trying to multiply my time I guess). I'm hoping the fall/winter will drop prices a little. I will probably just have to calculate a little higher than average vacancy among other things. I just love the fact that I can interface with people like you who have some time invested and know what to look for. Much appreciated!

 Every offer should insult the seller. If they aren't insulted, you aren't low enough. 

 Good advice! Alot of the house flipping shows make you think otherwise!

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