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All Forum Posts by: William Johnson

William Johnson has started 21 posts and replied 173 times.

Post: wholesaling and flipping houses

William JohnsonPosted
  • Real Estate Broker
  • Laval, Québec
  • Posts 183
  • Votes 59
Originally posted by @Hattie Dizmond:

@Kent Arrendell...while I hate Analysis Paralysis, I might suggest that you haven't necessarily spent the time to educate yourself on the right things.  If you have spent 6-months educating yourself, you shouldn't be asking what your first step should be.

I'm really not trying to be harsh or discourage you.  However, wholesaling is a really tough avenue to start out with, and you have the potential to make a mess of things for yourself and the sellers you encounter, if you don't enter into with the right knowledge.

You need a business plan.  It doesn't have to be elaborate, but you need to undertake the discipline of actually writing down...

  • Your goals
  • What strategies (wholeselling) you will employ to meet those goals
  • How you will execute those strategies (i.e. Create a website for lead capture, mail 1000 letters per month, etc.)
  • How you will measure your progress
  • How will you contract on houses you find (i.e. Simultaneous Closing, assignment of contract)
  • What your criteria will be for analyzing deals and what your threshold is for something being a "deal"
  • How will you market your deals
  • To whom will you market your deals
  • How will you structure your wholesale deals to investors (This will be really important as you find deals and develop a "core" group of investors who will purchase the majority of the properties you find.)
  • What types of properties will you target
  • What areas (you need to pick no more than 3 manageable ares to start, where you can become an absolute expert in those sub-markets) will you target for your marketing campaigns
  • How will you facilitate your marketing (internet, direct mail, door hangers, bandit signs, all/mix of the above)

If you had done this, you would know exactly what your next step should be.  Getting a phone number is the slam dunk part.  It takes 3 min on Google Voice.  What would happen if that phone number rang?  Would you know what to do?  Do you have contracts to use?  Do you have any clue how to vet a seller?  Do you have clue 1 about how to estimate potential rehab costs, if you had a chance to view a property?  You better have a clue, and you better be pretty darn good, because if you offer me a property and tell me it needs approx $20k of rehab, then I tour it, and it needs closer to $35k, there's a good chance that will be the last of your properties I bother with.

Again, I'm not trying to be harsh.  That's why I took time to write down the types of things you need to have ironed out, before you start.  There are tools for estimation in the File Place, and Contracts can be found there as well.  There are tons of information to fill in the blanks on the podcasts and in the blogs.  This shouldn't take that long, but you have to lay the right foundation, before you start building the house, or it's going to crack.

I would be happy to talk to you about any or all of the things I mentioned above (and I'm sure I forgot plenty).  Feel free to give me a call or email me using my contact information below.

Hattie

 Solid gold advice right there! I would also advise you to develop at least two or three more exit strategies (joint venture, rent to own, listing the house as an agent). 

The most important advice I could give however is

1. Start before you are ready. 

2. Make the decision that you will stick with it no matter what happens. Do not let your emotions dictate whether you stick with it or not. 

Post: Real Estate Agent Median Income is it False?

William JohnsonPosted
  • Real Estate Broker
  • Laval, Québec
  • Posts 183
  • Votes 59
Originally posted by @Sandy Thomas:

The good news is that successful Realtors come in all colors, sizes and personality types.  The bad news is that it is difficult to predict which will be 'successful' and which won't make it to their 2nd anniversary in the business.

Here is the best advice that I can give you: get up, get dressed, go to work.

In other words, treat it like a REAL JOB.  Set your alarm, beat your manager in to the office in the morning, dress sharp, listen intently to the experienced agents.  If you do these things, you will be ahead of 90% of the other agents out there and those experienced agents/managers will send business your way to encourage you (I know that I always send a hard working rookie business whenever I can because I want to see them succeed).

Plan to have little to no income for 6 months, maybe more.  Don't spend a lot on advertising initially but instead tell everyone you know and meet that you are actively building your business and ask them 'who do you know that is getting ready to buy or sell a home?'.

Pick up the phone and start making phone calls.  Friends, family, classmates, former co-workers.  Expired listings, for sale by owners, absentee owners, cold call a neighborhood.

Best of luck to you, Johnny!  It is a career that rewards those who work their tail off.  : )

 Wow great advice thank you very much for the coles notes for success as an agent! 

Post: Script of telephone negotiation with seller today (Advice wanted)

William JohnsonPosted
  • Real Estate Broker
  • Laval, Québec
  • Posts 183
  • Votes 59

Thank you very much to all who took their valuable time to answer my questions on this thread. I bet that on this single thread I will be spared at least 4 months of trial and error learning. I even watched one of the two movies recommended which taught me a lot @Jay Hinrichs .  Bigger pockets is my secret weapon I can't believe how much I have learned since starting here. 

Post: Looking for a coach

William JohnsonPosted
  • Real Estate Broker
  • Laval, Québec
  • Posts 183
  • Votes 59
I am a dedicated rookie investor with more than 5 years experience working under mentors as a volunteer to gain experience. I know I will succeed with or without a coach but I think I will succeed more and faster with a coach. I am looking for a coach who has a great track record and is well known and respected on BP. I offer terms where you get paid when I do the deals and not before. I am interested in wholesaling, lease options, wrap arounds and Sub2 for short term and multi family long term.

Post: Client is looking for business loan in Tampa Bay

William JohnsonPosted
  • Real Estate Broker
  • Laval, Québec
  • Posts 183
  • Votes 59
I am in Canada and a client who is from Canada with no credit history in the states is looking for a loan to buy a store and gas station. He will be putting skin in the game as well. Does anybody have a number he can call? I do not know him personally nor am I vouching for him I am just asking here on his behalf.

Post: Marketing Response and Inflated Expectations

William JohnsonPosted
  • Real Estate Broker
  • Laval, Québec
  • Posts 183
  • Votes 59
Hi Derrick, I see this often and when I do get motivated sellers I often feel shock because they are like 1/50 calls. I cannot believe what the market is willing to pay for houses!

Post: Looking for opinions

William JohnsonPosted
  • Real Estate Broker
  • Laval, Québec
  • Posts 183
  • Votes 59
Forrest Atkinson It really depends on so many factors. My advice looking through my own subjective experience is this: If you have liquid money then immediately start doing rental flips and cascade them to add a new one to your portfolio each year and become millionaires. If you don't have liquid cash then do flips, cash out, rinse and repeat until you can start doing rental flips as mentioned above.

Post: 4 Common Wholesaling Myths DEBUNKED

William JohnsonPosted
  • Real Estate Broker
  • Laval, Québec
  • Posts 183
  • Votes 59

@Karl Krentzel

I was actually speaking to your student, I think that teaching to not look at ARV and also to not look at renovating costs as important is irresponsable in teaching wholesaling. It is definitely not a myth that ARV and renovating costs are important. It seems like nothing more than a real estate teacher looking for a Unique Value Proposition for his business. Which is okay but either you are right and practically every other wholesaling article is wrong (including the calculator for this website) or the reverse is true. Sure you might get lucky but you are more likely to lose time and money not to mention burn your reputation if you blindly bring deals to cash buyers without any meaningful due diligence performed ahead of time (such as determining ARV and an estimated renovation cost to get the house to ARV).

Post: 4 Common Wholesaling Myths DEBUNKED

William JohnsonPosted
  • Real Estate Broker
  • Laval, Québec
  • Posts 183
  • Votes 59
Originally posted by @Stephen Chatto:

Real Estate Myths. I am glad my Mentor @Karl Krentzel is willing to tell me the truth so I can get deals DONE.  Her are a few myths he helped me DEBUNK

1) Myth #1 Realtors mess up deals and are a waste of time.

False - Karl has always encouraged me to work with Realtors. I am working with one now on a deal and she has been great. She found my ad on craigslist, called me up, listened to what I have to say and brought me a buyer. Now that She's involved she is keeping everything moving forward quickly and efficiently.

Extra Credit Question: Who do you think was using a higher ARV. The Buyer with the Realtor who gets to list the house after rehab or the average fix and flip investor?

2) Myth #2 - MAO = ARV *0.65 - Repairs . What a joke. I love this formula because it helps me be competitive in my market. My competition used that formula on this deal and his offer price was 50k less than mine. Plus to top it off. ARV and Repairs is completely made up. Your taking two numbers that are completely arbitrary and up to massive interpretation and then popping them in a formula to determine your offer price. COME ON. At the end of the day you need to know your market to learn where the prices should be.

3) Myth #3 - State contracts are stupid. Wow, I have learned the hard way that things run so much smother if on a state contract. As a wholesaler you are selling CONTRACT not houses. So it is fair to say that a better contract is worth more. We determined above that realtors can bring buyers. Strong buyers in fact. Do you think it is easier to sell that buyer with a Realtor a State Contract or a 2 Pager? Use a state contract and your buyer pool opens up tremendously.

4) Myth #4 - You need to know how much the repairs are, and the ARV so you can advertise your deal. What a joke. You think buyers agree with your repair cost estimates and ARV? Why waste your time. When advertising this deal I didn't include either. Here is the property. Here is What I know, Here is my Asking price. Don't think for your buyer.

I can think of multiple examples in my business when these 4 myths have been debunked. It feels good to know the truth

Hope some of you can benefit from this insight.

 Would you mind putting up some of your concrete examples with numbers and addresses?

Post: Wholesaling: LEGAL OR NOT!!

William JohnsonPosted
  • Real Estate Broker
  • Laval, Québec
  • Posts 183
  • Votes 59
Originally posted by @Richard C.:

Anyone who gives a blanket answer, yes or no, is blowing smoke out their @ss.

The fact is that this depends on state law, and at least sometimes on state administrative rules.  So the answer depends on two things.  First, exactly what activities are you defining as "wholesaling?"  Second, where are you operating?

There are people who will try to push some sort of global "get-out-of-jail-free" cared (or, "get out of trouble with the state RE commission free" card), telling you that the Constitution protects wholesaling (not true), or that any contract can be assigned and that contract law will trump regulatory law (not true), or that by signing a contract you create an equitable interest that always and forever places you beyond the reach of state law and regulation (not true.)

The real answer to the question, then, is "It depends."

 So how can one be sure then @Richard C. how can I protect myself?  I imagine that I will need to consult a lawyer.