Everybody wants to know this one thing, how do I get into real estate investing? Stay tuned. When I look, real estate investing, there’s a lot of things that go into real estate investing, there’s fix and flip. There’s wholesaling as property management that is buy and hold. But today by the end of this video, I’m gonna explain and tell you exactly how you can get into wholesaling. How does it work? How do you get into it, I’m going to explain all that. I’m also going to explain what is wholesaling what tools you need to get started with so you can take action and How To Find Buyers so you can bring them deals that they will pay you four without having to be licensed without having to spend any money without having to have the risk of purchasing real estate without messing up your credit or even having credit you don’t need any of that. All right, I’m gonna show you all that today. So let’s dive right in
so what is wholesaling? Wholesaling is signing a contract with someone that owns a property at a discount, okay, you can’t wholesale a property you really shouldn’t or won’t work, you can’t wholesale property that’s overpriced, because no one’s gonna take that deal. They’re gonna say, Well, I gotta make money, you are finding properties or deals for buyers that you have, or buyers that you will have no, I teach people that only go look for deals where you have a buyer already in place, just because it’s easier that way.
If you just go look for dealing, you don’t know who you’re gonna sell to, you’re gonna have run into a lot of problems and headaches. But what you’re doing is you’re getting a contract with the seller, and you’re saying, Hey, I’m going to buy your house for $40,000. Okay, I know it’s worth 100,000. And you know, it’s worth 100,000. But it’s not worth that at the moment. Maybe if we fix it up and that seller says, okay, yeah, I understand my house is not worth 100,000. Now, and I don’t have 4030 or $40,000 to put into it and the time and the money. And I don’t want to put the effort into that.
So you’re saying, hey, I’ll just buy it, and I’ll take care of it. And I’ll pay you what it’s worth right now you sign a contract for 40. But you have a buyer, you already know has told you I’ll pay 60 for anything in that area. That’s a three, two or two, one or whatever, wherever you are in the United States. So you call up that buyer. And if you do it the way I teach you, you’ve probably already had a conversation with him before you’ve put this house under contract. And you’ve just said, Hey, I have this house. I’ll give it to you for 60. And he’ll say none and I gotta be 57 Then you can negotiate, that’s fine, but you assign it to them.
You got it at 40 you give it to him for 47 you make $17,000 All without having to have the house purchase the home without having to had to do really do anything other than sign the paperwork and find the deal right for the buyer. That’s in a nutshell is what wholesaling is. So what tools do you need to start wholesaling? Well, it really depends on what level what strategy you’re at right now. So if you’re a brand new beginner, I would recommend calling on the MLS doing a lot of on market outreach. Now what is on market outreach people primarily they sell their home on the multiple listing service, they list their house to the real estate agent to sell.
Even if someone is distressed and they have a bit crappy house. Most people will list their home they just don’t know of any other way they don’t know of cash buyers. So you can find good deals on the MLS, you can see that homes are listed and they need work. And you can call that agent that represents that seller and say hey, I’d like to make an offer. Now it gets way easier when you’re doing this if you already have buyers in place and you know what they’re willing to pay or even just asking them what they’re willing to pay. So having that tool of the MLS and making calls to agents is what you need if you’re brand new.
Now as you get more experience, I would recommend marketing marketing is a great way to get deals whether you’re cold calling with batch dialer, whether you’re texting with batch leads, you can do mail you can do pay per click but I wouldn’t recommend doing ton of marketing until you have you know experience and you know how to navigate deals because when I first started I went out this what they told me to do they said hey, just go market so I went and spent $10,000 on mail because I was like oh this will give me a good return. I spent that money didn’t get any deals from it.
So I was like freaking out because I lost 10k If I had to go back I definitely would have done that or I would have had a buyer in place and be like where do you buy and if I had a call from someone that called me back for the mela would have said hey, let me let me find out what I could pay for your house and then I would connect them to my buyer and I would try to make money that way but as you go further the tools that you’ll you’ll need as you get more experience well marketing tools Okay, so as a beginner just get a phone start making deals or making offers on the MLS with Agent outreach, it’s free and as you get more experience go more into marketing. So once you understand what wholesaling is and what tools you need and kind of how to get started you’re going to need to find buyers but look before we get into finding buyers I want to ask you guys to come to my masterclass I have a free masterclass where I dive in really in depth on a live call and it’s absolutely free to get started. So go to a payneless wholesaling.com and register for it.
I’m going to show you step A through Z on how to get a deal You’re right, because I actually did a 30 day challenge me and Nathan Valley who’s on my team for 30 days we went to a market with no money and no experience no buyers and we both got deals within 30 days, I got a deal within 17 days I think Nathan got his within like 25. But we were able to do with no money. So what we teach, it literally works, it makes money. And we show you exactly how to do on the masterclass. So be there. So like I was saying you want to have buyers as you get into wholesaling so you can get started that way, I actually have a breakdown and in that breakdown video that I’ve done in the past,
I’m going to have you guys watch. This is going to show you exactly what to do as a brand new wholesaler how to get started as a beginner how to make money. Check this out. Let’s dive right in. So I call it the payneless wholesaling method. This is the blueprint, it shows you steps one through 10 on how to get a deal every step of the way. But the way I believe you get started in wholesaling is you have to at first mindset is really important because wholesaling. It’s a rollercoaster ride, especially when you get started ups and downs, it’s getting deals falling through. So you have to be prepared mentally to overcome that. So that’s the first thing I tell people. The second step is picking a market. It’s really important as you wholesale to pick the right market, because if you’re in a market that there’s not a lot of activity, a lot of flippers you’re not gonna have anyone to sell it to so you got to pick the right market. And you can use batch leads,
I show people how to use batch leads to pick their market. You can do cool things. You can check areas, you can pull lists, you can find buyers, let’s just say you were in Flagstaff, right? You’d be like, Oh, can I start wholesaling? Like a ton of deals in Flagstaff Arizona? Like is there enough volume is there enough cash buyers in this area for me to do deals. So right here, you can check if you just go to quick filters shows you that there’s quite a bit of cash buyers and that means sales in the last year or so. So Flagstaff would be good by the mount you can see says recent cash and hard money loan purchases of real estate. So they have automatic filters, it’s really easy to determine like if there’s activity if you’re in a major metro.
Because if you’re in a major metro, I’d say 99% of time, like there’s activity just because there’s a lot of people living there. If a population is big, that means that there’s a lot of people moving there. But if you live in a place that’s a little non populated, like 50,000 100,000, that just means there’s less movement, less people moving in and out of the state. That’s like a general rule of thumb. So the next step after picking your area is you want my goal. And what I tell people is do not just automatically or immediately just go start marketing and just calling sellers and trying to get a deal. Because you still are at this point, you’ve picked your market but you don’t know what people are buying markets differ all over the country. So you need to be able to understand your market and what people are buying.
So the next thing I teach and this way called the payneless wholesaling methods, I teach you how to network first, to find your cash buyers. Once you understand and have about five to 10 solid relationships, then you can with confidence, go out and start making offers. You can talk to sellers so if you go to my mind map, I show you exactly how to run comps for wholesalers. So there’s some really easy ways to do it. But let’s go to step one. How to find comps. All right, so I use batch leads. I like batch leads a lot because it gives you a good idea of comps you can just type in the address you want.
Let’s just look at this one. It gives you an estimated value it runs an algorithm right like most of these software’s, it tells you an estimate idea so you get a good idea just immediately like okay, what it’s worth even quickly does comparables and it checks a radius within a year square footage. It does all that and it shows you a bunch of different comps. So that’s a quick way to do comps like immediately. It’s just with bachelors so the next one is Zillow, and then obviously MLS data trumps all it’s the best way to find comps. So that’s how you find the comps. So you want to determine the ARV after you find comps in order to start the process of like, okay, what is a good deal? You need to find out what is this house I’m looking at? What is it worth if it’s at the top of the market, right or it’s fully flipped? So the best thing to do is find flipped comparables. If you’re just finding a bunch of homes that haven’t been flipped, it’s going to be difficult to determine what it’s going to be worth if a flipper goes there and makes it really nice.
Do your best to find comparables. The next thing that’s important after finding the ARV, so let’s just say for example, ARV you find a house that’s worth 200 And you know, it’s worth 300. So that’s the ARV is 300 Now you got to determine Okay, they’re giving it to me at 200. But how much repairs does someone need to put into it to get it up to 300,000? Right, here’s some questions to ask. So this says are you working with a seller virtually? Or are you working with someone your backyard this tells you how to navigate if it’s virtual what questions to ask and how to get pictures. So this is the easiest way to determine a light average or heavy repairs. So is this square footage of a house for example is 1000 square feet times the cost of the light if it’s light, it’s $18 per square foot if its average is 24. Or if it’s
So for example, you have 1000 square foot house that just needs carpet and paint are going to cost $18,000 Because you’re doing 1000 Square Few times $18 Very easy, didn’t need to go dive in deep into like a full rehab estimate spreadsheet. I just need to know square footage. Is it light, average or heavy? And if you’re like, Well what makes something light Nathan? Well, right here if you don’t have to touch the cabinets or the bathrooms, and all you got to do is carpet, tile, paint, carpet, or flooring, it’s usually light to light rehab. If you have to start venturing into bathrooms and cabinets and kitchens, then you’re talking an average rehab, if you got to do everything from a good job, we’re talking windows, everything, it’s 40. And that’s like a good job.
And these are average numbers, right? It could go up, it could be lower, but I would say 4024 and 18 are good. So if you’re talking to a seller, and you’re like, hey, you know, I’m interested in buying your house and tell me a little bit about the property. You’re like, has the kitchen been updated in last five years? No, it hasn’t. Okay, how about the bathrooms have the bathroom has been updated in the last five or 10 years? Yeah, we just updated last year. Okay, so I don’t have to worry about the bathrooms. Right? Then you’re like, Okay, kitchen. Yes, bathrooms? No, those are okay, and carpet and paint.
So you’re right in between like an 18 to 24 because you’re not having to do the bathroom. So again, really easy to determine what you need to get a property for ARV What is this property worth flipped? How much do my repairs need to be? Now we’ve gone over both you’ve looked at flip comparables, you know that it’s worth 300, you know that this house in this example is 1000 square feet, it needs $24 per square foot and this example $24,000 rehab, so you have the rehab and you have the ARV now, okay, so that’s two parts of the formula. And then now you calculate your offer that you can buy it at. And the way I do it is depending on if I’m talking to an analytical buyer, or seller, I sometimes even show them my rehab calculations and be like, Hey, this is why I have to be here, because I gotta make some money, but determining everything we talked about, I can resell for 300. I got to put in 24,000 I need to make 20 $50,000 I hope you understand I’m a business I sometimes walk people through my numbers so they understand why my offers $150,000 less than what they believe their house is worth this is the quickest way to determine if you’re talking to a motivated seller is forget all this noise all the stuff I just showed you look up someone’s house on Zillow and offer them 50% of their estimate.
That’s the easiest way to determine if you have a deal because if someone doesn’t get off the phone with you, then obviously you have someone that you can work with. Right another quick way to do it is 70% of the ARV. All you do is you find the ARV you could do this formula. So let’s say the house is worth 300,000 You say okay 70% of that minus we talked about $24,000 in repairs minus my wholesale fee I want to make $15,000 171 If I offered 171 to the seller and they accept I’m gonna make at least $15,000 the flipper will have his costs of 24,000 in there and then the profit expenses of the hard money all that stuff is calculated in the 70% That’s what the 70% is the 70% includes the 6% and commissions and fees for relisting it it also includes the closing costs the profit so one thing that everyone needs to know that’s watching this is Do not waste your time running comps on a property where you don’t have the seller on the phone complete waste of time all right, if you like that content, please do me a favor like subscribe hit the bell icon I promise you that I’m going to drop more good content and hey,
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