Currently, I do between 30-40 deals a year. I do a lot of JV deals with other people via wholesaling and rehabbing. I don’t really recommend it with all rehabs; it can be frustrating at times. However, if you are new to rehabbing, it could help you out a lot.
In this blog post, I will go over some key elements to building a good JV business. These JV deals could literally add an extra 5 or 6 figures to your yearly income. The best part is that you don’t have to spend thousands on marketing to get them.
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4 Steps to Growing Profitable Joint Venture Relationships
1. Be a Bona Fide Wholesaler
That’s right… if you say you are a wholesaler in order to get a nice amount of deals via JV a year, you must be someone who is actually closing deals in your market. Of course, you have the guys who talk a good game but are doing very little business. They are usually exposed in a few months. That’s why it’s important to be real and actually do deals.
I have had buyers on my list give me their houses they did not want so I could wholesale them. Of course, we would split the profit, but the reason they actually trusted me was because I was doing it and not just talking. Now, two quick ways to put yourself out there is to get involved with your local real estate club, as well as with BiggerPockets and post your success stories. Don’t be shy; they will help you out.
2. Be Approachable
In every town you have you successful investors who don’t want to help, talk or spend time with anyone. This is a bad practice. My personality used to get me in trouble at work, but now as a business owner, it’s a blessing. I am an open, very approachable person.
I talk with people, and when I give local people my card, I tell them to text before calling because I am usually working on my business. They respect that, and I’ve never had any issues. I do not give my phone number to people on the internet in another market I am probably not going to capitalize off of. I stick to local investors ONLY. If they have basic questions, I answer them. I am not saying let them use you. Know when to draw the line. I tell them, “I can’t necessarily coach or mentor you, but if you bring me a deal, I will evaluate it and if it’s good, we can partner up on it.”
3. Take Time to Have Lunch With Other Investors
I have been extremely busy lately with rehabbing, prepping a rental, and trying to grow my business. A friend who does more business than me in another market actually gave me this tip. He said, be sure to go one lunch a month with someone who is more successful than you. I thought that was brilliant.
I’ve started to take lunches or dinners with local investors. I recently bought a rehab from a guy with whom I went to lunch who actually called me first. I will make $100k on that house (which unfortunately I’ll have to split).
4. Be Completely Honest
Most importantly, you must be a honest person. Meaning, if you say you will give someone half, you’ve got to do it. Word will spread around fast when you do the right thing. If you do the wrong thing, word will spread around faster, and you won’t have people lining up to do business with you, to say the least.
You never know a person until something goes wrong or money is involved. Just make sure you are keeping your word with people. If you know you owe a wholesaler $5k on a $10,000 deal y’all just did, go out your way to pay them. Don’t wait on them to contact you.
In conclusion, simply don’t be a stuck up, arrogant, no good person. If you do the right thing, it will come back to you when you least expect it. If you do the wrong thing, it will always come back to haunt you. Make this process easy by making the right decision he first time. And watch you wholesale deals explode.
Investors: What’s YOUR best advice on creating solid JV relationships?
Leave your tips below!