My first wholesale: Did I blow it already?

Question

Hello BP'ers

I'm writing this post to either complain about losing my first wholesale before I got started, or get some advice as to how I could handle it from here. I found a boarded up multiplex (3 large units). It is in a pretty high demand area in an old building that needs a lot of work. I've talked to a few investors already who said they're very interested. I was able to determine who owned the building. After a long debate with myself today as to how to contact the owner, I decided to call him at his business (Which is not real estate) which was yielded pretty quick from a google search of his name. After all, Youtube showed me how to do it!

I immediately realized this was a bad idea as soon as I got him on the phone. You could say he was less than thrilled to hear from me.. He asked what I wanted after the spiel about calling his business. I let him know that I was interested in buying it and that I wanted more information about it. He said a lot of people are interested in it, but every time they find out he owes on it they bail out. I have insider information that someone who did the same thing and toured the property with him wasn't interested because he was asking too much (He's owned it for 17 years and picked it up for $70,000).

He made a crack about getting angrier with age, and how he HATES being bothered. I totally understand, I'm obviously not the first person to contact him about it. I did my best to rest assure him that it obviously wasn't my goal to bother him and I was here to work around his schedule. He ended up giving me his personal home number at the end of the call and told me to call him at Noon on Sunday. I feel like I've placed myself with every other time-waster he has shown the building to (Whether that's his fault or mine). Did I blow it already? If not, how should I present myself Sunday? Any pro-tips? I hate sales but I feel like this is a good start for me to become an investor. I feel like I picked a difficult first mission!

Alex Bock · Answer

Thank you everyone for your input! I talked to him yesterday. You guys pretty well hit the nail on the head. He has a price in mind (First I got 70, then I got 90). His wife was yelling him numbers from the background. He says the units are in fine condition as-is, and he could rent them out fairly easily with some basic inspections and repairs to the building. I let him know I wanted to help him any way I could. He says he has the cash in hand to get the building back up to par, he just doesn't feel like it. He said the building as-is provides some kind of tax perk for him.  I know for sure the units are outdated and that any investor I found would want to do at least a basic renovation. I let my buyers know of this, and as I suspected they aren't interested. At the end of the call, I offered him my contact information if the day ever came that he was ready to get rid of it quick. He denied my offer saying he doesn't plan to sell anytime soon. I am going to start an excel database to help me out. I know when he passes someday, his wife or kids are NOT going to want that building. Thanks again everyone for your time and encouragement. On to the next lead!

Mindy Jensen · Answer

@Alex Bock , I'm coming to the party late, but I agree with the general sentiment here that this was a success.

You actually have a HUGE advantage over other people, in that this guy is notoriously awful to work with. You don't know that, didn't let his gruff initial conversation run you off, and now you've had a nice chat with him again.

I'd make it a point to call him every month or two, just to say hello. Don't even ask about the property, just call and say "I'm Alex, we spoke a month ago about the property at 123 main st. I enjoyed our conversation and wanted to see if you'd allow me to take you to lunch sometime. I don't get a chance to talk about real estate that often."

If he says yes, make sure you pay for lunch, and just chat. Build a relationship with this guy - because everyone else seems to be afraid of him. Maybe nothing comes out of it, maybe you learn a boat load of real estate information from him, maybe he says no and you never talk to him again.

Literally, the worst thing he can do is say no and never talk to you again. Not such a big deal in the scheme of life.

Ken Yu · Answer

@Alex Bock

Honestly, you could write all of this up as a success story, because you did your work and you did it right! Putting in the work and grinding is the way to succeed in this industry. And who knows, maybe three months down the road he'll reach out willing to sell.

Tom S. · Answer

@Alex Bock  How did the call go?  You mentioned you were going to call him at noon on Sunday (yesterday).

Pratik P. · Answer

@Alex Bock

You didn't blow this at all! In fact, you did better than most wholesalers by taking action.

You have to understanding when it comes to this kind of marketing/sales niche, you'll encounter plenty of angry people. Get used to it. Stay confident.

Like Jay said, some of these older guys just want to hold on to these vacant properties unless they get a million dollars for it. When you encounter these people, just give them your contact info and ask them to give you a call when they're ready to sell.

Btw, don't get scared away from cold calling. Most wholesalers mail, very few will mail AND call.

Tom S. · Answer

@Alex Bock  I would say the same as above, he's interested and that's why you gave you his number and asked for a follow up call. Good luck!

- Tom

S. J. Gardner · Answer

I had a similar situation and it turned out to be a test of sorts. Seller was of the mindset that most who contacted him were looking to get the property from him cheap, dirty, and quick as possible. As much as he wanted (needed) to sell, he wasn't motivated to do business with any of them. He wanted to meet in person rather than discuss preliminary details via phone/email. After subtly making the point that I typically don't "invest" my time in visiting a property without first confirming certain basic details, I agreed to meet him. And it proved to be a worthwhile visit. He was more than forthcoming about the property and the associated financials. Ultimately, I decided not to make an offer. The asking was about 100% inflated over market and I'd only be looking to pay about 60% of market rate on this one. But because I took the time to establish that rapport, I'm confident my phone will ring when he's ready to come down a bit. Or it won't. That's a risk I'm willing to take. If someone comes along and wants to snag it at or near asking, I'm ok with that. But he made it clear that by agreeing to meet him, I made a clear and lasting impression. I believe that has value. Could just be me though..... Guess we'll find out soon enough. Will I make that exception for every property? Nope. But I think it was the right move for this one.

Jay Hinrichs · Answer

sometimes the good ole boys are nuts that can't be cracked... they have a thought or number and if you don't hit it they are not going to sell ... many times they simply don't need the money and are thinking of just handing the property down.

WE ran into this scenario in the Timber business in Oregon.. old farmers and timber owners in their late 70s and 80s  not much you could say to sway them.. they die off though and kids get it .. it will be sold in a heartbeat.. we always followed these closely we bought many a timber stand from the kids.. Dad may not wanted 1 million for the trees'  but the kids sure did and in a hurry.... LOL its all about building a data base and dripping on them.. many of our deals took 5 to 10 years to mature. and in the meantime the timber just got bigger and bigger so more volume more money

Jonathan Marcus · Answer

Congratulations, you got to the next step. My suggestion when you meet with him is to hear him out. Find out exactly what the problem is and the outcome he desires. In this business, you get paid to solve people's real estate problems. Don't go into the meeting with a predetermined acquisition strategy. You won't know what strategy to use until you know all the facts about the property.

My first wholesale: Did I blow it already?

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