All Forum Posts by: Dev Horn

Yes, what you described in brokering, which requires a license.

On the other hand, you can do what people call "wholesaling", which is to actually buy the property yourself (put it under contract) and then assign your interests in that property to a cash buyer in exchange for an "assignment fee".  Your assignment fee can be any %, as long as the cash buyer finds the price + fee to be acceptable.

And before anyone tells you "you can't do that (without a license)" - in Nevada you can absolutely do that (wholesale properties) without a license.

One challenge is to keep track of your comps. I've scratched my head at how a guy could beat me only to find out later he sold the rehabbed house for a price higher than my ARV, which was based on past sales comparables. Here in Dallas it's a tight market as well and prices are increasing, so you have to put a premium on your ARV... maybe a factor of 1.2x what the comps are telling us.

The old ARV x 70% - Repairs model is a non-starter in most markets right now. Serious investors - not just newbies - are paying more to get deals and maybe not making the % they'd like, but as long as the ROI on their capital is acceptable, they'll do the deal... better to make a little money than NO money. The kids gotta eat!

No shortage of perspective here!  =)  lol

Wow.  Anyone notice that the OP has not been back to comment?  He just disparaged wholesaling and then sat to the side to watch the fight amongst the readers.  What fun!

Wholesalers are marketers.  They simply find motivated sellers in exchange for a fee.  If they drive prices up too high, they don't do any/many deals and ultimately move on to some other money making idea.

But seriously if you think it's wholesalers driving prices up, I disagree.  The thing driving prices up is limited inventory of housing in most markets in the U.S. right now.  It's a seller's market in most major metros.  That is definitely making it harder to find deals these days, and I think it leads people to think the problem "must be those d**n wholesalers!".

P.S. I agree with Hattie that most the wholesalers that I know personally are also cash buyers that simply wholesale deals that they don't choose to do.  It's not lost on me that there are tons of posers in this business.  I just don't really think the posers are in the mix as much as you think.  Most of them are too scared to make offers, and very few of them get deals under contract.  The wholesalers I meet in my market are NOT those posers.  They are people who have serious marketing  processes & budgets.

Hey Eric... We try to live answer all calls. Given the alternative, I would almost rather the calls go to a good voicemail message than have a robotic VA handle the calls (where it's obvious they're just reading questions and filling out a form).

However you handle them, make sure it sounds & feels professional.  You want homeowners to feel like they've reached someone who know what they're doing.

This is a video I did to help our guys fine-tune their call handling skills.  You might get something from this as well.

For the most part, the rules that govern "bandit signs" are issued at a local (city or county) level.  Most larger cities and towns have city ordinances that state that the signs cannot be used or a fine may be imposed.  Some smaller towns don't have specific rules about them.  Houston definitely does have well-defined sign ordinances.  Found this in a PDF doc re: Houston:

Off-Premise Signs

An off-premise sign shall mean any sign that advertises a business, person, activity, goods, products or services not usually located on the premises where the sign is installed and maintained, or that directs persons to any location not on the premises. Bandit signs, signs on utility poles and billboards are usually off-premise signs.  Signs NOT on your building and property are regulated by the City of Houston sign administration in the City of Houston's Planning and Development Department. These include signs both in the City and County. The City regulates the off-premise signs because the County is in the ETJ (Extra Territorial Jurisdiction) of the City of Houston.

To place a sign on property upon which your business is not located requires both the permission of the land owner and a permit from The City of Houston. These must both be received prior to the erection of the sign. 

 Everyone needs one of these hooked up to their laptop.  ;-)  Very nice.  In our business, that's like looking at a Ferrari...

A few years back we worked with them a bit and they were legit.  Ryan Wright is a good guy.  I think they really are kind of a match-maker (help you find HM locally) rather than actually do loans themselves.

And yes, they'll give you POF letters... which can come in handy for wholesalers...

Right, I've bought quite a few and have gotten good ones over the years under $500.  Start at a few hundred and if he doesn't bite, ask him what it might take to get him to consider it.

If it's a seriously great name and he knows he has a lot of value, he could ask for the moon.  But as you say he's getting very little from it now, so perhaps he'll let it go cheap...

Hey Richard, I will give you - sight unseen - 65% of assessed value and 5% on the note!  =D  (I'd really enjoy New Hampshire!)

You raise a point that we discuss all the time around here.  People who own free & clear don't have a mortgage payment, and that removes one of the biggest "motivators" which is that big payment the owner must make every month.

Christopher - consider direct mail as a core strategy tho.  Absentee owners, code violators, tax liens, divorced, etc.  You can pull lists with many criteria via a service like Listsource.com.  Use a service provider like YellowLetters.com to print and send postcards out (yes, they have really nice postcards, not just letters).  Or get someone to design a piece just for you on a site like Fiverr or Upwork if you don't have design talent in-house...

Otherwise, signs work.  And Google AdWords (if you know what you're doing)....