All Forum Posts by: Jonathan Greene

If you are planning on buying with an FHA loan, spending time and money on off-market lists won't be very fruitful. Most off-market sellers, especially in a competitive market, are lured to sell by quick deals, cash, and limited inspections. With an FHA, you will have a long closing, full boat mortgage, and FHA inspections which are not easy on a seller. If it's your first buy and you want to utilize an FHA you should be looking on-market with an agent where you can do full inspections and can have any FHA anomalies corrected.

I do not agree that finding the highest volume sales agent on Zillow will help you when investing OOS. It probably won't help you at all. They may know the area well and have done the most deals, but they also are unlikely to understand the psychology of the OOS investor. Also, they will be the busiest agents with the least time for you, one deal from OOS. They will transfer you to their team which may or may not be a good thing. You want to scour that market to see who is listing flipped properties and who says in their bio that they work primarily with investors.

But backing up, why are you buying out of state and do you have any contacts in your target area at all? Have you been there? If you are planning to buy OOS with only internet relationships, it can go sour real quickly if you don't vet the pieces of the puzzle well.

I agree with @Matt Nusbaum that the first step in your journey for a mentor or coach should be grounded in defining what the next level is for you and your wife and your team? You are on a good path if you've done 37 deals in 6 years and are still running, but when you have one part of the team as an agent and one as the business manager, there are ways to start to merge on-market and off-market to serve both well and to collaborate inside your business like that. Have you ever done direct marketing for non-MLS deals or has your wife found all the deals through MLS and/or real estate contacts?

There are some wholesalers who will let you know that the seller will accept financing, but it is dependent on how active your market is and how active the off-market activity is. The more bids any property gets, the less likely financing will be attractive unless it is much higher. It's not impossible, but if you aren't getting off-market leads on your own, it would have to come to you from someone.

Others will say otherwise, but Facebook ads for distressed seller leads are not great at all. The best lists are built with older homeowners who have owned the property for 15-20 years and they are not looking at ads on Facebook. Facebook, in general, will get you a ton of "leads" but 99 percent of them are terrible. This goes for on-market and off-market. It's a numbers game, but the lead flow can be overwhelming (and garbage) if you know how to do FB ads.

What you're calling a "no supply market" is really a "limited supply on the market market." If you aren't doing direct mail or some other form of off-market targeted prospecting, you can't expect to get a deal in a solid market. There are always deals everywhere, in every single market in the country, you just don't know about them if you are only searching on websites or MLS feeds. Hot markets will get multiple bids and the only way to win in those markets is to get ahead of the curve and develop an off-market gameplan. But, you have to find the pockets in the market where less investors are raining down marketing. It's not easy, but when you find the funnel, it will open wide.

You want to get that profile filled out on BP so that people can evaluate what skills you have that may assist them. It helps if they know where you live, what markets you are interested in (NY/NJ is big), what special skills (more than what you put above) you have backed by your personal experience.

Good deals just don't fall out of the sky in good markets. You have to do the work to find them. There are plenty of deals in the Las Vegas area, you are probably just looking on the MLS. Do you know any local wholesalers? Have you gone to local REI meetups to make contacts who may know about off-market properties?

I never think it is a wise idea for a first-time investor to invest out-of-state. You are placing a lot of trust and a lot of money in the hands of strangers you find on the Internet and you are trusting them to value your big investment. If you want to be a real estate investor, you have to learn how it works by seeing properties locally and knowing what each price point looks like in person and how to evaluate repairs. You can't do this process from out of state.

@Erica Pelfrey I was fortunate enough to grow up in the business so when I started 30 years ago I was only using my own cash. In order to scale now, I have a large line of credit, but I also have a substantial amount of my own cash and investments and zero debt. If you have personal debt, I would not even consider buying more properties until the personal debt was down to zero. A lot of investors think that they cycle will go so well that it will eliminate their personal debt, but when you keep adding more debt to the calculation and factor in the likelihood and reality that more properties equal more problems, it's not realistic to think this way. The most important factor to getting the end goal you want is to get rid of the debts that tie you, personal debts first.

It sounds like you are moving way too fast to me. You are rushing to acquire doors by using your entire HELOC. A HELOC is a big debt, so you are not getting close to living debt-free when you are wanting to max it out. Way too many investors are trying to figure out how to scale using any loan possible or OPM, but that's not a framework for future success. It can work, sure, but way more people have been burned by running too quickly into door porn fantasy. They want to accumulate assets while accumulating debt.

Are both of your properties running perfectly and at their peak? If so, then you are off to a good start, but why are you rushing to get limited door income while maxing out your initial debt capability?

You have to segment your businesses to do it properly if you plan to invest as a person on your own. I have an off-market property acquisition company that sources properties and buys direct from owners. That is a personal business. If any of the sellers want to list, it goes on the market. If I sell my own investment properties, they are marked as a personal sale, but many, if not all, brokerages have a limit on the amount of personal deals you can do per year. Many are only one so in that case you need to find a brokerage that maximizes that. For me, I can cap quickly at my brokerage so my deals are all going to be at 100% after a certain point anyway, but you have to be very clear with your brokerage about your plans.

When I worked for Sotheby's they would not "allow" me to operate an off-market business buying properties for myself. I had all the proper disclosures and had an entire plan, but they were greedy and thought they should get a cut of everything. Basically, anything on market goes through your brokerage. If you are working completely off-market, there are issues that can come up with your licensure and brokerage. You want to run through the scenarios if you are not comfortable understanding the options.