I'm new to this forum but not totally new to real estate investing. I live in North East Ohio and I've been a lic. real estate sales agent since 1998. I just recently started buying and selling property for myself. So far I have did a few wholesale deals and a few retail rehabs. This year I have rehabed 3 houses and sold 1. I have deals on the other two and they should be closing soon. I have wholesaled 3 properties this year also.
My goal is to triple my numbers in 2007. I hope this forum will be a good place to bounce ideas and get honest feedback. I look forward to participating.
Welcome to the forum, WireMyCash. It sounds like you are already on your way. That's great. The first couple steps are always the hardest.
So what is your plan to reach your goals for next year?
That's a really good question. I regret to say that I really haven't put a plan together yet. I just know I want to do alot more deals. I'm so glad you responded. Now my probability of reaching my goal just went up. :D
I want to focus more on wholesaling to get my cash reserves up. One thing I feel I need to do is run an ad to build a better buyer's list. I was also thinking about registering three more LLCs so I can do an assignment of member because I'll most likely want to assign some bank repos. My brother-in-law trust me enough to give me the whole amount and close in my name and then just quit claim title to him right after closing. I don't think a stranger will do that so I need to find another way that will work with REOs.
A wise man once said "Where there is no guidance the people fall, But in abundance of counselors there is victory." In light of this fact, please, tell me what you think my plan should be.
Here's some ideas on your buyers list:
If you're serious about growing your wholesale business I'd recommend you read through the posts at
You will get some really good info there.
Also, why not just double close instead of assigning an LLC on the REO's?
Have you joined some real estate investor clubs yet? If you are serious about being a wholesaler, I would attend EVERY one of them in Cleveland. :D They provide exactly what a wholesaler lives off of, networking. If you are going to spend the time and money on an ad, you should spend the time and money on joining and attending REI club meetings. I am amazed at some of my local wholesaler competition who only attend meetings when the speaker is of interest to them. I don't know or care who the next speaker is, I WILL BE THERE. I am a networker. I NEED more investors and more deals, and I need to meet everyone I possibly can that I might do business with. I atleast know of if not personally met and networked with every single decent player in my town. I know every hard money lender here. I know every established wholesaler here. I know every experienced rehabber here. I know every note carrying guy here. I know every significant landlord here. I know them all. I know them all because its my job to know them all. Now the population of my city is only 200K, but I guarantee you that if I lived in Cleveland, I would still know them all.
I guarantee you that if you had the vision, the ambition, the guts, and the follow through that you could easily wholesale 100 houses next year in Cleveland by just applying some basic principles. Now doing that many rehabs is a little different, but 20-30 rehabs is completely feasible.
I know it sounds like a lot, but, Isaac, I see and meet a LOT of new investors that just want to do their first deal or two, and seeing one that has done the first five or six and has the deep desire to grow their business just gets my blood PUMPING. Its because it was ME a couple years ago. I had the vision and I used my ambition with all the guts I could muster and I have followed through to bring my business to a whole new level.
First set some long term goals and strategies. What are you doing this for? What EXACTLY do you want out of this? Create a target first, then you can start piecing together exactly how to get there. Wholesaling and rehabbing can create capital for you, but what are you going to do with it when you get it? Are you just going to increase your lifestyle temporarily? Or are you looking to set your self up long term? Wholesaling and rehabbing are another J-O-B. Now they can pay well, but I would recommend thinking about and researching more residual avenues to reinvest your new found capital.
Okay, so let me focus here on what you are wanting to do. You want to triple your numbers for next year. 9 rehabs and 9 wholesales. Can your contractor handle 9 rehabs? Can you afford 9 rehabs? Do you have the marketing to get 18 deals? Do you have the financing capabilities for all this? You said you want to focus on wholesaling to get your reserves up, does that mean that 9 rehabs next year is more dependent on your capital situation? If that is the case then let's just focus on wholesaling for now.
Wholesaling comes down to two principles. Finding deals and your investor network to sell them to. Blitz both. Start brainstorming ways to find deals and start doing them. Start doing them consistently and persistently, and in the meantime start brainstorming ways to find investors and start networking with them. Start networking consistently and persistently.
Now if I were to value one over the other, I would pick finding deals, because I know that if I can find a good enough deal that someone will buy it even if I have to stick an ad in the paper or list it with a realtor. My investor network is essential for what I am doing, but the deals are the fuel to this engine. They make the machinery work. If you find good enough deals and market them properly, the investors will start coming out of the woodwork to you.
10 or 20 wholesale deals is completely feasible for you to do in a year, but also realize you will have to change what you are doing. You will be changing some things you are doing because you want to change some things that you are receiving. I say this because I am amazed at how many people want changes in themselves or in their businesses, and yet they expect it to arrive through the exact same avenue that they've been doing all along. You will have to change how you are looking at it. You will have to step it up in your marketing, and in your searching, and in your networking. You will have to become more efficient and more diligent. You will have to change. Just realize it and embrace it.
Now Isaac, I am curious to hear some of your initial thoughts and strategies to reach your goals for next year. If you aren't comfortable broadcasting them on the forum then feel free to PM me.
Thanks a million for the links you posted. I just finished reading them. Excellent information :superman: . As Robert Kiosaki would say,you have just expanded my context (possibilities) and my content (know how). I never thought about wholesaling 100 houses in a year. I get goose bumps just thinking about it. When I reach that volume of business I won't care about rehabbing any more. The only reason I can see myself doing a rehab again is if I can't move one of my wholesale deals for some reason. The reality is I don't like rehabbing much. It's a headache. If I can make that type of income wholesaleing I'd rather just skip the retail side all together. After my cash income needs are met I can move on to my long term goals.
Part of my ultimate long term ("why") goal is to live very comfortably off 10% of my income, sow 50% of it into causes of my choice, and use the other 40% to build a large inheritence for my children and my children's children. I can visulize a little over 17 thousand units across the country with less than a 10% vacancy rate, netting between 100 to 200 dollars a month per unit. The units should net even more for future family generations. That feeling is beyond awesome.
Now that you have stretched my context into 100 there's no way I can shrink it back to 9 or even 20. I feel the need to set a goal for at least 52 deals a year. That's an average of 5 per month. In an earlier post you stated that wholesaling is based on certain principles. 1.) Finding deals 2.)Your network of buyer investors. The easiest and cheapest way I know to find distressed property is the MLS. The problem with that is the bank/REO sellers always want to dictate which title company you use. The title company seems to have a definate alligence to the REO/seller in the transaction. I've never tried to get them to do a double close. I know my own title company will do it. I would love to do a double close, I just don't know how to pull it off with a bank REO. My next choice for locating deals would be combing the classifieds every day. Next would be working vacants, then bandit signs and door hangers. Later on I'll need to set up a direct mail farm and a yellow page ad. I guess I just need to use three or four good methods to start and use them"consistently and persistently". I'm unsure about what my ratios should be in order to hit my target goal. Which methods should I make highest priority and how much of each should I do? I need to change the habit of just relying on the MLS or waiting on REO list agents to call me.
I have made a commitment to join my two local REIAs and be at EVERY meeting to network. The biggest one meets once a month and the other meets once a week. I will also run a blanket ad in my major newspaper.
I have to admit that I feel a little confused and overwhelmed right now. I assume it's normal and will pass after I've closed my 25th deal sometime around May or June of 07 :D . By then I should be familiar with the systematic process. If not before.
Is there anything else I should be asking about?
Ahhhhh, the BHAG (pronounced "B" hag). :shock:
I first learned about the power of the BHAG from a Bill Gates book.
It will require more of you than you have ever given. It will stretch you further than you have ever reached. It will demand of you more than you have ever thought possible. And in its achievement you will be, do, and have more than you have ever imagined.
Its the Big, Hairy, Audacious Goal.
And in it lies greatness. 8)
The most important question is are you ready for it? Are you willing to do what it takes? Are you ready to give, and reach, and think beyond where you have ever been?
Don't be too intimidated by it. Every journey is merely a collection of small steps taken in sequence towards a common point, but understand that it will require of you more than you have ever given. It will stretch you further than you have ever reached. It will demand of you more than you have ever thought possible, but each of these steps is taken one after another, after another, after another. On the way through your journey, you will look back and be amazed at far you've come, and yet you will feel like there is still so far to go.
You will have to go through the fires of discipline and focus, but if you stay the course, the gardens on the other side are for the company of greatness.
Now let's move on to some practical concepts. Again, wholesaling success comes down to two things, finding deals and building your investor network. Check out http://forums.biggerpockets.com/viewtopic.php?t=6212 to get an understanding of your basic marketing startegy. You will become a marketing FREAK. You will need to be constantly brainstorming and implementing different ways to find deals. You will need to of course take into account your budget, but when you do start turning houses DO NOT GO BUY A NEW CAR!!! :protest: REINVEST it into more marketing. Don't eat your seed. Cast it out there, and let it grow. Remember it is not about finding 1 or 2 golden ways of finding deals. Its about building a network of marketing techniques that will each give you a deal or two a year. I'd also recommend you check out http://www.birddogz.com/new/. They have a free ebook that gives some great marketing ideas.
I would recommend picking a handful of farm areas that other investors really like. They will be lower end blue collar neighboorhoods. They will have a large number of renters there, and normally the average house will be less than half the average priced home in your city. Also, stay away from "war zones". If every third house is boarded up, that's a war zone. Move on. Your farm areas will be areas that you will specialize in. You will need to learn these areas backwards and fowards. You will need to find every possible investor that invests in those areas. Get creative in finding them. Search them out, and shake their hand. Get their business card and what they look for in a house. Put together an information list with these investors name, contact info, and what they are looking for. Be doing all this AS you are looking for deals. Deals are the magic ingredient.
In reference to a lender requiring a certain title company, you would be surprised at the number of title companies that will do double closings. I would ask the assigned title agent if its okay if you double close. They may have a couple hoops to jump through, but they may be open to it.
I would also recommend that you get multiple avenues of financing lined up. Depending on your credit, go hit up some bankers. I would recommend for you to try to work into a line of credit with a bank for the wholesale deals that you have to close on. I have found it to be the most efficient way of financing short term deals.
Isaac, keep me updated. I'd like to know what's going on.
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