Beginner Tips For Wholesaling Real Estate with Brian Tian

Hey everybody, welcome back to the New and Experienced Investor Podcast. Today we have an amazing show. We're talking about wholesaling real estate. It's definitely a show you don't want to miss. I'm one of your hosts. I'm Alex Barnett. I'm the new guy.

I'm Andy Homs. That makes me the experienced one.

Oh yeah. We have an awesome guest. Like I said, super stoked for this. He has a PhD in finance and is now deciding to go all in on real estate investing, starting with wholesaling. I'm super excited to talk about his story and get into some beginner tips for all you guys interested in wholesaling and where to start. Before we bring him on, let's talk about the meetup coming up really quick. We have a meetup on July 28th, and this is a really cool one because basically it's called Stand Up and Connect. So people will go up and be the speaker for 5 or 10 minutes. And talk about what they're doing, what they need, and then people in the audience can connect with them. So it's kind of a roundtable session. It's really cool. So I invite all you guys to come to that. I also wanna remind you, you get the most outta the show when you jump in the chat and start asking questions because guess what? We're live right now. So make sure to share this far and wide with any new or experienced investor. In your life.

Do you want to introduce— we have like 2 guests today. We—

yes, we do. We have a co-host, and I was just getting there. Uh, before we bring our guest in, let's kind of, uh, you know, tell people how Joe got so young here.

So I'm Andy Homs. I'm, uh, actually Joe's son. Joe is on a cruise, uh, prospecting some, uh, real estate in Other areas, other countries.

Yep.

And so I'm here today to fill in for Joe.

Yeah, really excited. Andy and I have worked on a deal in Huntington Beach. It's been my greatest flip ever, and he knows his stuff. That was one of the first times where I actually did the work, and you showed me how much money you could save when you actually do the work.

Yeah, a little bit here and there. It adds up real quick. Yeah, it was insane.

Yeah, I looked at all the numbers after. I was like, we saved like $30 grand, and I was— in the garage, like, you know, painting. And he's like, here, take this light bulb, go over there and screw it in. I'm like, am I doing it right? He's like, yeah, way to go. So it was good to get hands-on experience.

Yeah. Yeah. So I've been doing fix and flips for about 15 years. Learned from the best, obviously, my dad, Joe. And so that's kind of the way he taught us all was to, you know, get your hands dirty and A little bit of sweat to get the project done. And, you know, we've progressed a little bit over the years to adding in some contractors and stuff to our team. But yeah, you can definitely save yourself a lot of money if you have some of the skills and ability to do some of the work yourself.

Heck yeah. And you're even getting your daughter started in it, right?

That's right.

Yep.

She's probably got like more experience than half of our listeners.

She's only 9, but yep, she came to our last project and was helping with a little bit of painting and You know, sanding and different, you know, stuff that we were working on at the time. And she loves it. She likes to help with design aspects and pick out materials and colors and all that type of stuff too. And she says when she wants to grow up, she wants to get involved in real estate as well.

That's so cool. I mean, think about that, like from your grandpa down to your dad, down to you, down— it's like, that's a skill that's just being passed down.

It's amazing. It's awesome.

I love it. So let's go ahead. Let's bring in our guest right now. Super excited. Brian Tien, welcome to the show. How you doing, Brian?

Good.

Um, thank you so much, Alex and Andy, for having me here. Yeah, I'm super excited to be here.

Right on. All right, well, let's jump into it. You have an amazing background. Why don't you kind of tell people, um, what you were doing before you got into real estate and what you're doing now?

Yeah, sure. So I was actually a PhD student in UC Irvine from 2014 to 2020 in finance. And after that, I joined 2 hedge funds. I was a quantitative researcher, so I was a numbers guy. So I built mathematical models to try to predict how the market— where the market is going, and hopefully we can make some money. And along the way, kind of talk with my friend, and they're really, really into real estate. And gradually I learned that through real estate, I can— like, it's really a great vehicle to build, like, generations of wealth. So I was pretty fascinated, and I decided to get into real estate. So I started with a, like, my first rental property. And, but like, long story short, that was my worst investment to get started with. But later on, several of my rental properties, they went pretty well. And then I decided to get into, okay, well, if I can buy some properties from wholesalers, then why not I get into this stuff on my own? If I'm in California, then I can get into real estate California wholesale. markets, right? And for other non-local areas, if I know how to do stuff, then I can teach somebody else or even like expand my like sort of business to generate leads for somebody else, like investors, so I can scale my business. So that's my initial thoughts to getting into wholesaling. Yeah.

So amazing. Yeah, we had lunch the other day and he's like, telling me, he's sat down, he's like, I know you're a musician. I'm a musician too. I play classical music. And I was like, if you want to feel lazy, sit next to Brian. Because he is like, you've already lived 10 lives and then now you're starting to go into the wholesaling. But I love that attitude. And something that really jumped out to me was how much you were already tracking your metrics.

Yeah.

And I think you were at 14 days or something of cold calling.

Right.

Yeah. What can you kind of share with people? You're like, you're the breakdown of, you know, what you're doing?

Of course. So actually, I was into this for more than 1 month. And actually, this week is the 5th week. And every day I cold call for 4 hours. And my statistics are like, I use the dialers and it dials about 1,500 to 2,000 numbers a day, but not all of them, you know pretty well, like better than me, not all of them will pick up their phone. So I actually have the meaningful conversations. What I mean by meaningful conversation is they actually pick up the phone, they say, hello, what do you want? And they either tell me, okay, I'm not interested, or they say, hey, I'm interested, or I'm not Trying to sell now, but I could be interested in later. So I have around 30 to 50 meaningful conversations out of that. And out of those 30 to 50, I get around 2 cold to warm leads per day. So that's my statistic. That has been the pattern for the past 4 weeks. Yeah.

Nice.

That's great.

Yeah. Really good. Really good. I mean, you're just, just having a regiment like that is really gonna point you in the right direction and, and set you up for success because any of these marketing channels, it takes time to kind of build on itself, you know? And it's like, you gotta, by the end of this year, if you, if you stick with it that long, you'll have somebody that you talked to at the beginning of the year now ready to sell.

Right.

And you've had to nurture and nurture and nurture that.

Exactly, yeah. So at the beginning, I wasn't sure if I'm on the right track. So I started to track my statistics. And what's more important I have to stress is to reach out to professionals like you, Alex, and Joe, and Andy. The other day I ran into this, this post, the great post like Joe shared on BiggerPockets. And I ran into this, hey, he's hosting a great investor meetup tonight. And it's actually about wholesaling. It's the same day. I was like, wow, I need to attend this. Right. And then I meet with Alex and Joe and they are, they were giving me a lot of great advices and And immediately after that day, the second day, I booked an appointment. I had lunch with Alex and Joe. They gave me more great advice and they actually let me know, okay, I was actually on the right track. So that kind of a psychological effect is priceless because you know that, hey, they are the professionals and they have been through what you are Going through, and they're telling you, hey, you're on the right track. And the other day after that, you, Alex, you generously shared with me your drive for dollar list, and I immediately caught that list and found several cold to warm leads. And I actually found one lead for Joe, although that's not the like. kind of actual investment or great deals that we want, but Joe is able to represent that seller on the market. So I find values in things and that's what, that was a completely a great experience for me. So people, if you're trying to get into this and make sure that you reach out to Alex and Joe and Andy, Because they have great things for you and they are generous— generously sharing their experience and help you go along the way.

That's really cool, man. Thank you so much for those kind words. And like on the flip side, we're so excited to see somebody that's like actually taking action. You know, it's like, I'm sure Andy's seen it being here with Joe. People come in and out of these doors all the time. He'll lay it out A to Z. This is what you do. This is the next steps. And then you just never hear from people again just because they kind of fall off or life gets in the way. But to see somebody that's just taking action, it's like, you know, OK, you're going to hit on something really soon.

Yeah, I think part of the reason is kind of like the fact that the time from getting the results— sorry, actually getting the results and the time that you are actually making the actions, kind of that feedback loop is long. So a lot of people, they, if there are like several steps at each step, like 90% people would drop out. That's kind of my expectation. And in fact, me myself constantly feel that kind of frustration.

Right.

But what I know is that I need to like make, take actions and after actions until I make that first deal. And that's also very important why I reached out to you guys because you actually have been through all of this stuff and you have tons of experience of how to Like take all those things that could happen along the way. Yeah. So hopefully I can, like, I can stick with it and until I make my first deal and to get my own proof of concept.

Heck yeah.

Yeah. And then I build a system that I have more and more leads coming into through my funnel and more and more deals that can be closed. That's my goal.

Yeah, that makes sense. And I like how you track your metrics as well, because like you said, you can kind of get lost in what you're doing every day. And is it successful? Is it not? But you kind of know how many leads that you're getting, how many calls it took to get to those leads. And I feel like, to me, that would be helpful to kind of reassure that there is a process that's working, and you're getting some success out of it, instead of just kind of being like, yeah, I was on the phone all day, and I don't even know what— Kind of went on. So that's really good.

Yeah, thank you. And I think that also set me the baseline. So eventually, like, it's not me, it won't be me to call, like, to make the prospecting calls every day, right? It would be the virtual assistant. So it gave me a baseline. So if I can do this every, like, every day for 50 conversations, then my VAs should be able to do this on this ballpark, right? So that gives me OK, if my VA is kind of as effective as somebody else. So that's also a very important metric to note.

Yeah, that's important.

Yeah, and I think we talked about it at lunch, but cold calling has the longest cash conversion cycle, meaning when you put the action in to when it actually cashes out. So it's definitely— I think it's a great one to get started because you're honing in on your negotiating skills, you're overcoming objections and all that stuff. And then it's also teaching you discipline, but it does have that long feedback loop, like really long feedback loop.

Oh yeah.

And I wonder, it's kind of like, think about when you played clarinet, right?

Yeah.

Yeah. So when you're first starting an instrument, and I think about this sometimes too, I'm like, you just like, when you, 'cause I learned guitar, I'm like, you suck for so long.

Oh yeah.

And you're just doing these things with no, No sort of like, you don't get any benefit from it, but you keep doing it and keep doing it and keep doing it and keep doing it. And then finally, you know, it's like, oh, I'm actually playing a song. Oh, it actually sounds cool. Exactly. It's kind of the same thing where it's like you have to keep putting in this action, not knowing, or I guess it's a sort of a theoretical reward until it actually becomes real. And then when it becomes real, it's like, oh yeah, this is where it's at.

Yeah. I'm very glad that you bring that up. It's very similar to like when you play instruments initially and you just suck at it, right? And you don't even know, hey, why am I doing this? Like, the thing that gets me started into this is, hey, I looked, I watched a show and that player was fantastic. But when I actually picked up my own instrument, I was stuck at it, but it's like every hour that you put in practice every day when I was young, that actually accumulates that time and that effort. And after several years, and I have to admit, I quit it once. And then my dad came to me, hey, you need to continue to do this. Because I feel like you really love it. It's just like you haven't get that stage yet.

Mm-hmm.

So I resumed to clarinet playing, and after several years, I can do fantastic music. And that was the point when I actually found, okay, I'm actually doing— playing great music with the initial thought that I was going to do.

Mm-hmm.

So I think that 2 things from that. One important thing from that lesson is the thing that gets you started may not be the thing that you can keep you going along the way. So you need self-discipline and you just need patience. And up to some point, you will see your your own effort, um, realize.

Yeah, absolutely. Um, Andy does a lot of, uh, on-market stuff. So can you explain kind of like how you go about getting these on-market deals?

It's kind of, it's, I mean, it's the same but different. I mean, it's, it's tracking metrics, it's, you know, analyzing deals, um, you know, coming up with kind of lead sources. So searches within the MLS to, to get those kind of, I guess you would call it cold leads or like, you know, the numbers that you're calling just off of a list type of thing. And then once you kind of get some traction on one and you're analyzing the deals and, you know, just going after them just in a slightly different way on the MLS.

Yeah.

And so it's kind of all, you know, the same thing and it's still got the same learning curve. It's, it's very difficult. You're dealing with a lot of other agents that don't necessarily want to work with other investors or, I guess investors at all. And so yeah, I mean, it's just again coming over overcoming objections, all that type of stuff to you know solidify a deal. And then after you're working at it for many years or you know however long it takes to to really kind of get a system going, you know it can be a little bit difficult and you have to just kind of keep at it. And one thing I like about real estate is it's it's kind of like on the job training. Right. And you could start out. brand new, just like wholesaling, and just, you just go at it and you're gonna make mistakes. You're gonna learn things along the way, but that's just all part of the process. And eventually you'll get there. And like you said, like, you'll, you'll eventually obtain that goal that you set out to obtain in the, in the very beginning.

Yeah.

Yeah.

Yeah. It's, it's kind of the same process.

Yeah.

And the one thing I love about the on-market deals, it's like, The overhead is basically nothing. You know what I mean? Like, you could just use your own cell phone, call these agents.

Yeah.

Put it, you know, be putting in an offer where some of these other lead generations or I guess lead sources can get pretty pricey.

True.

You know?

Yeah.

So that's a good, I think it's a good mix to have if you have some on-market stuff, you kind of get your cost per lead down.

Yeah.

Yeah. I mean, obviously there's the, the cost of, You know, becoming a realtor and maintaining your license and the real estate key to access properties if you want to show yourself the property, or you can work with an agent, an investor-friendly agent that will submit offers on your behalf and show you the properties or maybe inspect them for you in the initial stages. And so yeah, it definitely can be a little bit less on the upfront cost compared to getting into something like wholesaling with You always want to have the best list, and all these things can start to add up with the different services and lead gen sources and virtual assistants and all that type of stuff too.

Oh, yeah. Gets crazy. The first check, or maybe it was maybe like the second check, bought frigging every software. I bought like 10 things. I ended up using like 2, you know what I mean? And then it's like you're on these automatic subscriptions. I'm trying to figure out how to integrate them. So then I got rid of everything and then like went back to a spreadsheet, you know?

Yeah.

So it's—

you still do that.

I still, I love my softwares. I love my software. But, um, can you jump into some of the stuff that you're using right now? Like the, the software?

Yeah. Uh, you mean the tools?

The tools?

Yeah.

For dialers, I, I just use ReadyMode cuz, um, I, I feel like, uh, that is like a lot of people, uh, they, they recommend ReadyMode. And I, after several days, I mean, I had my learning curve, but now I'm getting familiar with ReadyMode. And I've actually used and tried another tool, but that didn't work out. That tool claims that, so when you're calling people, if your numbers gets flagged, then they will automatically swap it for you.

Oh.

The catch is they don't even have enough numbers for you to call. So I didn't put a lot of effort into that. So that's kind of like A/B test, but the B test does not go through.

Right.

So that's for my dialer. And I'm happy with ReadyMode. And my CRM, I use Podio.

Okay, nice.

Because like, think about it, I only— I'm just into this for like 4 weeks. If every day I can have 1 to 2 leads, cold to warm leads, then at most I have like 40 to 50 leads, right? And Podio is some kind of— if you have less than 100 records or leads, then it's completely for free. But even if you are above that, it's still like several dollars or maybe $15 per month. So it's quite like starter-friendly software. And that are, I would say that are the only 2 softwares that I use. Of course, I use Google Suite or Google Work. WorkSuite?

Yeah, WorkSuite.

Yeah. And that's it.

That's about it. Okay, great. Yeah, I think that's the best way to approach it. Just keep your overhead as low as possible because it can really start stacking up. $100 here, $100 there.

Right.

Yeah.

All of a sudden, you're paying an extra rent payment. Oh, yeah.

Oh, one thing I forgot. I use Batch Leads to get my list.

Nice.

Yeah. But that's really about it.

Okay.

Yeah.

And Batch Leads includes the skip tracing, right?

It includes skip tracing. Nice. And it's actually the news just came into my side that Batch Leads was actually acquired last week, right? Oh, by PropStream.

Oh, interesting.

And they actually send out several pieces of emails to, to, to us, to the, to their clients to say, hey, Batch Leads is now part of PropStream and more news coming.

I wonder what that'll do. Yeah, that's probably— that's great.

Yeah, maybe some type of integration will save some money.

Yeah, no, totally. Because right now I'm using just PropStream and then I, I export the list and then skip trace it.

Oh.

So having the skip tracing already within the amount you're paying would be nice.

Yeah, it is.

That's good.

Wow.

Interesting. Yeah. PropStream is getting crazy. I know they were bought by Stewart Title.

Oh, OK.

And then PropStream was. And then, yeah, I mean, it makes sense. It's kind of like, we'll just buy out—

Yeah.

—batch.

Couple mil.

I wonder how much that was.

I don't know about that deal.

Yeah.

So tell us a little bit about analyzing deals. And maybe do you kind of apply some of your financial background towards the analysis of deals when you're looking at, you know, you get a lead and they're interested in selling the home? Where are you coming up with the value and putting kind of the deal together?

Yeah, it's actually like, it's not that. So When it comes to ARV, right, it's not that kind of as complicated as I do in my mathematical models. It's just like, hey, what kind of similar properties can you find either on Zillow or on Batch Leads? And I just narrow it down to, okay, the similar property that sold in the past 3 months or 6 months and then take an average. Before taking an average, I will look into the property to say, hey, is this property just flipped? Then if it's flipped, then I'll give it a higher weight. If it's not flipped, then I'll give it less weight.

Okay.

So that's how I come up with ARV. And so, you know, as a wholesaler, besides ARV, we also need to be able to evaluate how that the ballpark of the repair cost.

Right.

So I find a website which is called handsoff.ai. So it uses artificial intelligence technology to, if you talk to it, hey, this is the property I need to get some evaluation and this is how it looks like right now and I would like to repair it up to a certain grade and help me generate a, like, repair, like, repair list itemized and give me that final cost. And so it will do it for you.

Wow. Okay.

But since I don't have, like, tons of experience in repair or flipping side, so I'm currently relying on this. And I figured this is a lot— it's a little bit more expensive than the reality.

So it's kind of a buffer built in then.

Yeah, I think it has like 20% of buffer because it's mainly used by contractors and they have to put their margins, profit margins in there. So there's around like Uh, 20%, uh, buffer. That makes sense there. Yeah. Okay. Yeah.

Yeah. The AI tools that are gonna be coming out are insane. I, I've seen one where like you just walk through the house with the video and then it gives you like a scope of work similar to what you're saying. Oh, like all the stuff that needs to get repaired. Okay. That's, I mean, right now it's all hype, you know? And then when you actually use it, I, I don't know how good it is, but I think it's gonna get there eventually. Yeah. And that's gonna be A time saver and just streamline everything.

Yeah. Yeah, it is. Hopefully it doesn't eliminate us all.

I mean, we probably still have to do like face-to-face. Maybe not. I mean, I've gotten people to sign documents without ever like seeing them face-to-face, but—

Right.

Yeah, we definitely have like AI agents like being able to call for you.

Yeah. I think my experience with AI is like, so this is my take. So AI is kind of the thing that summarizes a lot of things based on previous data. So it is trained based on like the past photos or similar photos and similar walkthrough videos or photos, right? And then it kind of thinks, okay, if I have this kind of condition, then I will need to make this kind of repairs. So it generates a list for you. But ultimately, we as investors or as flippers, we need to decide, okay, I actually need to fix this, but I don't need to fix that. Or this is the grade I need to fix it up to, but—

Right.

You actually— the AI tool has some misjudgment. Yeah. So it only can give you some advices, but whether you're taking it, you need your own judgment. So that's my take on those all kinds of AI tools.

Yeah, I was playing around with AI the other day. I got a proposal for an HVAC system on a property that needs you know, it, it only has a heater. It's a coastal property. There's no air conditioner. And so I took the proposal that I got and just for fun of it, put it in, uh, you know, one of the AIs and said, hey, you know, take the, whatever this, uh, guy's saying it needs and compare it to other companies and what their price would be, or, or just, you know, general, uh, prices for this area. And give me kind of an itemized list of what exactly is on this, uh, and what each item would potentially cost. And it spit it back out. And it, at first it looked okay, but then I started looking at it and it, it said that the original quote was asking for, you know, an air conditioning system for a certain brand, a Goodman brand and all this stuff. And I'm like, I, I even asked him, I'm like, where are you seeing this on there? And it was like, you're right. It is actually not on there.

Right. Yeah.

It's like, it literally was like completely making up stuff and, yeah, like lying. And I'm just like, That's why you got to keep an eye on this stuff.

Yeah, that's also my experience. On certain stuff, I'll ask for AI's opinion. Hey, what do you think of this? And they will give opinion A, and I know that opinion A is not true. So I tell them, hey, I know this is not true. And then immediately it asks, it says, yeah, you're completely right, my boss. And it's actually this. So That's when I, like, I was very alerted to, to refrain myself to completely trust AI.

Right. Yeah. Yeah. It's, it's got the training wheels on for sure.

Oh yeah. Apparently Grok is kicking ass though.

I heard they're going to put it in Teslas. I don't know what that means, but yeah.

Yeah. I heard you can, you know, I don't know if it's like specific to controls within the car, you know, But I've heard someone say that they, they had it and that you could tell the car, hey, I'm driving to this area. This is the address. It's cold right now. And, you know, I'm in this mood and it will put on the music for that mood. It will set the temperature of your car to a certain temperature, put the, you know, heater on or air on or whatever and navigate you to that address. And I'm like, yeah, that could be interesting.

There you go. It's for all the Star Trek fans when they, when they like talk to the computer, it's like computer. Yeah. Set up hologram for the beach, and then it like makes it. That's the only reason we created AI was to have that. Awesome. Back to wholesaling.

Okay.

Yeah. So, um, what I guess, what's kind of like the future steps? I mean, let's— if everything went perfectly, what, what, what do you, uh, what's the path you're following?

Yeah, I'm actually currently This week I'm preparing to hire VA. And so I was preparing my like job posting. I just posted my job postings yesterday and today I already got like 15 to 20 applications.

Okay.

They're all very hardworking people.

Right. Where are you posting it?

onlinejobs.ph.

Okay.

Right. I'm sure you also use that as well. So I'm preparing to interview those candidates tomorrow, and hopefully I can get down to one and to work with him or her starting from next week so I can free myself up from like this kind of 4 hours to do the initial cold calling and so that I can focus more on the follow-up things.

Right.

And once I feel like, okay, I'm getting some traction on those follow-up steps, then I'll hire another guy to— or use the current guy that I'm going to hire as the follow-up manager. And so that I can just go to the properties or visit the properties myself. And so this is kind of a step-by-step System building, right? This is where I'm thinking I, I'm going.

Nice. Yeah, I like that. What are you looking for in a candidate for a VA?

I'm looking for like whether she or he has already has some experience. So for me, if I can do this for 1 month and I can have this kind of results, then I'm looking for somebody who has at least 1 month of experience, right? He or she knows how to handle rejections, handle angry callers, handle like, oh, hey, you know what? I'm not interested. And what did they say next? Hey, do you have a property that maybe your friends or family had? They have a property that They might be open to a cash offer. So I'm looking for that kind of reaction. And I'm also looking for a guy who does not take those rejections personally because that's really important. Otherwise, nobody will be able to do this kind of job because 99.9% of the time you're going to hear no. Yeah, it can get tough.

Right.

Yeah, our job is to find that 0.01%. Like what Joe said, we're looking for gems out of like dirt.

Right.

Yeah. So that's what I'm looking for. And also I'm looking for like the right attitude. So if somebody are not so experienced in this, but he or she has the right attitude, hey, you just tell me what should I do? I follow instructions. That's for step 1. And once he or she gets familiar with all this stuff, because it's not hard, I hope she or he can come up with some ideas to say, hey, Brian, this is how I think we can improve the process. That will be amazing. But that's just a preferred skill or attitude, but it's not a requirement. I know, like, people The reason why people apply for this kind of job is like people all different, they all have different motivations. Some people, they're okay, I can do this. I'm taking this as a paycheck, like money-paying job. Somebody else, they will take this as okay, I actually want to learn something. So Different people have different motivations.

Yeah, absolutely. And you're totally right. Like, I'm blown away by some of these VAs and how hardworking they are for like what they make.

Yeah.

And they're doing it in the middle of the night.

Yeah, that's—

Which is unbelievable too.

Yeah, yeah, yeah. I feel like if I'm the person who does cold calls, right, in the middle of the night and constantly hearing nos, It's kind of like a torturing thing, right?

I, I would ask my VA because like we would do like morning meetings. Yeah, I'd be like, what time is it there? He's like, it's like 2 in the morning. Like, how do you do this, man? This is insane.

Yeah, and think about that. They have family, they have their own life, and they live in their life— they have their normal life in the daytime, and but they have to work During the night. So for anybody, this could be a tough job.

Yeah, yeah, absolutely. The good part is you get used to the nos and you get used to asking people if they're interested in selling their property. We went to an estate sale over in Dana Point and it was one where they had a little booth set up. So you'd walk up and there's 2 ladies putting it on. And I was like, oh, what's going on with the house? They're like, oh yeah, they're thinking about selling it. They don't have any agent right now. And I was like, oh, um, okay, will you give them my number? And then they, they ended up calling me, um, just from that. But it's like, you just get over it, you know? It's like, I'll go up to anybody like that says they have a house and be like, hey, have you thought about selling?

Yeah, yeah, I think that's a, that's a pretty good, um, like habit, right? Yeah, yeah.

Like Garage sales, anything. What was going on with the house though?

Yeah. You never know when that sale will bring you, bring you a new deal.

Yeah. Yeah. Yeah. You never know. Well, they ended up calling me and then they, they like, with each sentence, it like was like, oh, this isn't gonna be a deal. They're like, there's, there's 4 of, there's 4 or 5 of us kids that inherited the house. We all own our properties, so we know what it's worth. And like, I was like, okay, well. I'm an investor, so I'm going to give you a cash offer. You know what that means, right?

It was definitely an investor special. Like, everything was original to the home.

Yeah, it needed to be totally redone.

Yeah, but, um, but they want top dollar.

Yeah, top dollar. Of course, of course they want $2 million for doing nothing. Yo, mom and dad gave it to him.

So speaking of that, I'm wondering how you, like in this kind of situation, right? You know that property doesn't worth this much and you know that they're going to find out. How do you like maybe quote unquote educate them so that they can be more quote unquote cooperate so that you can improve your possibility of closing the deal?

Yeah. I always, I'll do little things like, Third-party stories where I'm like, I see somebody else bought a property similar to yours down the street for, let's say they want $1.6 million and it's worth $1.2 million.

Okay.

$1.2 million. And then just be silent. And then if they're like, oh God, no, that's insane. Or I'd be like, what would you think about that? Or if they're completely stuck on it, then like I told you, I switched to the creative finance, which is what I did with that one. I pitched an ovation. So I was like, well, what if what if the property stays in your guys's name? I can come up a little bit higher. We'll do the fix, and then you know you'll get paid out at the end. But they weren't having that either. So sometimes there's just no there's no getting through to them. You know, but it's just part of it.

Yeah. Well, in the cash cash offer or wholesale type situation, there can be advantages to the seller to working in that type of situation versus. putting on the market. Maybe they don't have the time, or they want to— they don't want the time to use the time that it takes to sell a property on the open market, deal with all the inspections and unknown costs. And, you know, just all the stuff that comes with that may not be, you know, their cup of tea. They want to, you know, get their money and get out of California or whatever their, you know, case may be. I've run into lots of different situations like that. And so Maybe educating them on kind of those advantages to just take a cash offer and move on. I mean, it, it really just has to kind of match the situation. So if it, if it doesn't match, and, you know, you're not going to be able to talk them into it. And like you said, right, you know, if they're stuck on a certain value, you can try and you may be able to get them down on price if they're not being realistic.

Right.

But I mean, it may Just take them putting it on the open market and just having it sit and sit and sit. Maybe they'll call you back later. Yeah. But yeah, sometimes it just doesn't work out, unfortunately. Okay.

So I guess it's sometimes we just need to wait, and which is why like constantly following up is super important. So you know that they're going to find out, okay, this house that we thought were it could worth doesn't really worth that much. Right. And so with constantly Like following up. At some point, they will say, hey, what you told me is correct. And now I realize the value of this house. Let's come up with a price that works for both you and me.

Yeah. Just make sure you lower your price a little bit after they come crawling back.

Oh, OK. That was 3 weeks ago. Sorry.

OK.

Yeah, it's like Brent Daniels puts it, like, people are basically trading their equity for speed and convenience. That's really all it is. And so the more motivating factors that they have, that's where it starts weighing on them. Because people new to this whole thing are like, why would anybody sell at a discount? They don't realize there's all these holding costs, possibly there's like tax bills, all that stuff starts to add up. And if you don't have that, it becomes a burden.

Yeah.

And you're like, I just need to get rid of this thing, you know, and I'm not going to be able to put any money into these repairs. You know, all that kind of stuff. When you're talking to somebody and they're saying all those things, you're like, okay, this could actually be a way that we could help them out, get them their cash, and then we get a deal as well.

Okay.

So that's where I like to just focus on motivation completely. You know, it's like the, the condition, any of that stuff, I'm like, that's secondary to actually like what's going on with your situation. Yeah, break it down. And a lot of that people aren't comfortable talking about. Obviously, you're just a stranger calling them out of the blue. So them opening up to you is, is, it's kind of a psychological skill that you can hone in on with certain questions, open-ended questions, you know, tell me more about this property.

Right.

Tell me more about your situation, digging deeper into that. Then all of a sudden they let their guard down. They're like, well, this is the whole deal, you know, and then you're getting the whole situation and you can kind of plug yourself in with how you can help.

Right. Yeah. And I think maybe another, just add something on top of your advice. Another thing that I got from experience is that last Thursday or Friday, I cold-called a lady. She was originally very like alerted and she told me, Okay, I, I'm going to sell this property after some time, but not now. And I asked her, okay, do you have a, do you have a mortgage? And she told me it's free and clear. So I immediately told her, okay, maybe, ma'am, you need to think about whether you need to do a 1031 exchange because you get a ton of equity, right, in, in this. You get a ton of capital gains. and which Uncle Sam can take a scoop. And I think that's kind of sharing a small piece of advice that they feel, oh, you're not actually taking something from me and out of the blue you are giving me some advice. And then she immediately opened up. She told me, yeah, I'm not sure this thing, this fact helps, but this is— This, this, this and that situation. So she ended up talking more to me and I feel like, wow, this, yeah, offering some advice upfront helps. It's kind of a sweetener to the conversation.

Yeah, absolutely. Yeah, leading with value and being more of a consultant. Like when I was taking the Pace Morby courses, he would start off, he's like, I'm probably not like the right fit for you and probably not the right buyer for you. But can you kind of catch me up to speed? That's like his big thing is like, can you catch me up to speed with what's going on? That could lead anywhere. That could be like, well, just inherited the property, XYZ. But him starting off with, I'm probably not the right buyer, he would always be like taking it away.

Okay.

And that kind of puts their, you know, takes their guard down.

Yeah, I feel like there's like some kind of psychological effects.

Yeah, yeah.

If initially I kind of push you a little bit away, then people want, hey, what you're doing?

Right.

Come to me a little bit closer.

Absolutely.

Right? So I think that's kind of a small psychological trick.

Yeah, no, totally. Yeah. And all it is is like, you just tell me what's going on and I can probably help. But people are like, they lump the callers in with being a salesman. And if a salesman calls you, you can lie to them. Doesn't matter. You're allowed to just say whatever you want because they're trying to trick you with their black magic. That's what people try and— people basically think.

Yeah. Well, and you're probably not the first person to call them and offer them a cash offer. And so maybe differentiating yourself probably goes a long way. Solve their, you know, see if you can solve their problem. Yeah.

We have some questions stacking up.

Fire it off.

So, well, first we have a comment. We've got Charlie in the chat. He says, hey, I'm new to the channel. Right on.

Welcome.

Great stuff.

Cool.

And then we got Liz.

Nice.

She says, what common objections do you face from homeowners and how do you handle them? Maybe like top 3 objections?

Yeah, the most common one is, no, I'm not interested. Please don't call me again. Right. That's the mild one, right? And sometimes people will, hey, why are you calling me? Where did you get my number? And they just hang up. And a lot of times, some objections, they're They're, they're saying, hey, you're telling me you're giving me a cash offer.

Hmm.

So what is your cash offer? And then this is the point I tell them, hey, yes, sir, ma'am. Yes, we're offering a cash offer, but that amount will depend on the location and the condition of the property, right? So whenever they have an objection, And this is great advice you gave me, Alex. You turn that objection into a question and shoot it back. So, hey sir, it will depend on the condition of this property. So do you know, or do you still remember when was the last time you did a remodel for this property? What's the condition was like? What is the roof? Which year did you replace the roof? So that's one of the common objections.

Yeah.

Yeah. And yeah, I think that's basically— that's kind of some typical objections I've run into.

Yeah, and one you always hear also is they'll just keep repeating. They're like, well, I do want to sell. I'm not desperate. Like, I don't have to sell right now. And then they'll go into, but I am behind on a couple of my mortgage payments. And they start going into these motivating factors. But I'm not desperate. I don't have to sell right now. They just keep saying that, keep saying that, keep saying that. And you're like, yeah, no, that's fine. You're not desperate. I get it.

Yeah.

So that, and then you just, like you mentioned, just keep asking questions, digging, digging, digging.

Yeah. And I take that as anxiety, right? So there is a reason that they keep bringing up, hey, I'm a little, a few months behind my mortgage. So that to me, it sounds like, yeah, I do have a motivation to sell if you give me the right price. So that's how I take this kind of like wordings.

Yeah. Oh yeah. For the right price is a huge one too. If I hear that, for the right price, I'm like, okay, so Zillow minus or plus a dollar, probably. Whatever this estimate is, that's what they want. Yeah. How do you get price out of people? That's hard.

Yeah, sometimes I feel like Southern California people, sellers, they're more sophisticated. Perhaps just too many people have called them in the past and they just get used to this kind of calls.

Right.

And whenever I say, hey, what are you trying to get out of this? And somebody, they're completely unrealistic and you can tell they're not really trying to sell. For a property on Zillow, it shows like $770,000, right? They will tell, hey, you give me two million for cash. I'll sell. Yeah, yeah, yeah. And and at that time, initially, like maybe three or fourth day I get into this, I'll try to like how do I how do I put it? I'll try to prove them wrong. Hey, sir, I just saw that Zillow shows this one is just seven seventy, but you're asking for two million. And gradually I shifted to that. Okay, so sir, you're not really trying to sell, right?

Right.

But I feel like that is not even the best answer. The best answer should be, oh, okay, you're trying to get $2 million out of this property. But do you know similar properties? Any similar properties have sold in the past? What are they? What would they sell for?

Right.

So that kind of— I use that as a conversation opener. And sometimes they just, hey, no, that price. I was just— since you bring the cash offer up, so I was just talking about that is just unrealistic. I'm asking for like $770,000 or $800,000. And so you immediately know, okay, He has some— like, he realized that $2 million is not realistic at all.

Yeah.

Yeah.

Yeah. It's just— unless it comes with a couple of Ferraris or something on the side.

Yeah. Yeah, really.

Yeah.

We got Chad asking, have you embraced the lovely triple tap while calling?

Triple tap?

Yeah. If somebody doesn't answer— I've heard about this. Famous triple tap. You call them. So you'll probably do it mostly on the follow-ups. So you call somebody, they don't answer. Call them again. Call them again.

Right. At least 3 times.

Close the session. Yeah, yeah, yeah, yeah. At least 3 times in a row.

Actually, currently I have some leads that I initially categorized them as like cold or warm leads, and then I put into my Podio system. And then when I set the— when it comes to my follow-up days, I call them, use my own number, and they don't pick up. And this is currently a problem that I'm trying to solve. The way I solve it is like before that initial reach-out call, And I'll tell them, hey, I'll probably reach out again with a different number, and do you have a moment to take down my number?

Nice.

That's one thing. And also I ask them, hey, sir, ma'am, do you have— do I have your permission to send a message to your cell phone? Along with my digital name card so that they know who they're talking to.

Nice.

And once they take notes on their cell phone and the next time I call them, my name will automatically pop up on their cell phone. This is the solution that I think might add some help, might be helpful a little bit.

I think so. Yeah. Setting the expectation for the next call definitely helps.

Yeah.

Getting them. Yeah. And then getting them to have your number in their phone because, I mean, I don't know about you guys, I'm getting like 20 spam likely calls a day. I don't know who these people are.

Yeah.

Yeah. So they're probably getting the same thing if they own any rental properties. They're probably getting blown up.

Yeah. It's just unfortunately it's like everyone these days is getting flagged as spam. I was in a transaction a couple weeks ago and I got a spam call and I just happened to pick it up and it's the real estate agent on the other side. I'm just like, oh man. Yeah, the carriers are cold calling people. Savage.

Yeah, the carriers, they're, they're going a little bit crazy these days. They automatically like flag people, uh, who make maybe just a little bit above average calls per day, right? Right.

Most of them are spam, but it's very difficult to maintain a good outgoing number.

Yeah, it is really difficult. And I think different carriers, they use their own servicer or data vendors to evaluate which number are spam number, which number are not spam number. And nowadays for each carrier, like the major carriers, AT&T, T-Mobile, Verizon, they have their own data vendors. You have to register your numbers at each data vendor to tell them, hey, I'm a valid investor. I'm making my calls to actually buy things, not to sell things. And this is my company's information.

Right.

And I am— we are a valid company. We're registered. So I think this helps a little bit.

That makes sense. Yeah. What are some of your favorite lists that you're calling on? I know you mentioned the Driving for Dollars. What are kind of some of the other characteristics that you're putting in on the list that you're generating?

Right. So I think in terms of the motivation, it's definitely the pre-foreclosure list. Okay. Yeah, that's a good one. But the downside is that the The number of properties in pre-foreclosure list is much, much less than other lists, right? So in Orange County, the average number is like 600 properties for the entire Orange County for pre-foreclosure. So that's kind of like half an hour dialing, right?

Yeah. Well, then it's a lot, there's a lot of competition.

Yeah.

Of other people pulling the same list.

Everybody is tracing that, that list. And then the other list I use is like owner-occupied. I call it owner-occupied 60+.

Okay.

Does that name make sense? So it's like they already own this property and they're seniors. That's why I call it 60+.

Yeah.

Yeah. Because there's a filter to filter the age of the owners, and I set it as at least 60, like age over 60.

Okay.

So that's another list I call. And also I call absentee owners.

Okay.

Yeah. So people who has properties, but they don't actually live in it. They're either landlords or investors. But apart from that, we— I also use some other filters. For example, they have to own this property for at least like 5 years. And I required the estimated equity in that to be over 50%.

Okay.

Yeah. And I don't call like the company-owned properties because they are, first, they are hard to skip trace. And second, they are more sophisticated.

Right.

Yeah. So yeah, I think that's— oh, another list is tax default. But that list is similar to like pre-foreclosure. And tax default also doesn't have a lot of properties in there.

Yeah, probably less than pre-foreclosure.

Yeah. Yeah. And I think that, Alex, your list is fantastic. I feel like, yeah, the $1,300. That list, I think the conversion rate in that list is higher than my other list.

Okay, nice. Yeah, yeah, because they may not be on one of the, you know, the list pulling motivating factors. Yeah, just house just looks crappy. Yeah, so yeah, this is the part of the show where we've curated a few videos and I would love to get your reaction on some of this stuff. Oh, these hot topics. Okay, you got a second?

Oh sure.

Yeah.

Okay, do we have anybody else we gotta get in there?

Uh, we got one more, but we could save it for the end. Okay, let's do that. All right, how to make a million dollars wholesaling.

Easiest way to make a million dollars wholesaling.

We'll take North Carolina. Let's say that your average deal, like your average deal size out there, is about $25,000. You know what, let's just say $21,000. All right, okay, this is straight wholesale. You're trying to make $1 million, 48 deals. Okay, so 48 deals a year, 48 divided by 12 is what? That's 4 deals a month for $21,000. In my opinion, come on now, that's very, very easy to do. Let's break it down even a little farther. How many acquisition reps do you need to do 4 deals a month?

1 to 2.

Depending on their ability to convert, right?

Yeah.

Okay, how many disposition people do you need to To sell 4 deals a month?

Say one.

How many transaction coordinators do you need to transact 4 deals a month? One, if that. You know what I mean? Right. You see, like, in essence, it's a very small operation if you think about it, right?

Yeah.

To do 4 deals a month for $1 million in gross revenue, it doesn't take a massive team. Easiest way to make—

Wow. Yeah. I think my take over this video is that Yeah, I definitely believe it's possible. But his angle is more talking more like from the operation angle. So that means he has a huge assumption that everything is already in the system. So he has constant deal flows and his funnels are already set up.

Oh yeah.

Yeah. And he has all of those things, proof of concept, and he constantly do this. So I think it's definitely possible once you are above certain— like you're over a certain stage. I think it's possible.

Yeah, it's kind of like guru math, where they're like, it's super simple. $1 million, what is that? 48 deals? 4 deals a month. That's easy. Yeah, you got to be spending $200 grand a year probably to get to that point.

Right, yeah. All the overhead, and you got to hire the people that are acquiring and—

Yeah, the leads.

—disposing those deals.

Right, exactly.

You know, stuff in between. So that, you know, may not be your take-home at the end of the day. And like you're saying, you got to build that entire system in order to be able to start scaling it to something on that level.

Yeah, that guy is talking about like after the mature stage. But before that stage, it might take somebody like maybe 1 to even 4 years to bring that business To nurture that business from a completely new one to that stage. I think once it's after that stage, it's like that guy can tell, OK, it's pretty easy. But it's just that low-hanging fruit instead of that nurturing stage.

Or you can just pay that guy $50,000 and take his course and just get to the front of the line. Come on. Yeah. What else? What else we got?

We got one more. Hold on. I lost my mouse here. Here we go. How many cold calls for a wholesale deal?

Everyone's asked Zach, how many cold calls should I do? And first of all, it's about quality over quantity. But if you can max quality and quantity together, so let's just say probates. If I cold call 100 probates, I probably have a 20% chance of finding a really good deal there. Now, if I cold call 200 probates, goes up to 40%. And statistically, I do 1,000 probates. It's almost 99.9%. It's never 100% chance you're going to get a deal because you could be absolutely terrible with your stuff, but it gets pretty close to 100%. Why is this? Because people who are even bad at wholesaling, if they cold call enough motivated sellers, it works out. So everyone's asked, Zach, how many?

Simple enough. He didn't really give any numbers there, but—

100 properties, 20% of the chance. Wow. That sounds Amazing. Is that math checking out?

You're a math guy.

Does that check out? Well, I'm, I'm not really calling like probate, uh, for now, but I would think it's, it's amazing results if it's 20% of finding the deal just over 100 property, like property, a list of 100 property. I, I was finding amazing. Yeah. I'm a bit skeptical on that.

Yeah. Yeah.

I don't think that's true at all. All right. Well, we got Joe hosting from the chat. Whoa! He says, ask Andy to speak about currently closed property and if he's going to wholesale or flip it, and ask Brian what he thought about the condition of the home.

Okay, it sounds like you stopped by our deal that we're working on down the street here.

Oh yeah, the other day Joe took me to your property. Yeah. So I was trying to learn, okay, hey Joe, How, like, how much, like, what is the before condition and what is the after condition? And so he took me to 2 properties and to let me take a look at the before condition, the after condition, and help me to evaluate, okay, how much I should, uh, I should, I should evaluate on the cost of repair. And I actually went in into your property and that looks amazing.

Thank you.

And, um, it's amazing opportunity. It's amazing opportunity. And, um, the design, you know, the design, I feel like it's— if I'm the buyer, then this is the, the house.

It's really cool. Yeah, yeah, yeah. It's got a view of the golf course and all that. It's definitely, you know, in realtor speak, it's got lots of potential.

Yeah. And so, so I— it's not a huge house, right? It's, uh, 1,400 or 1,500 square feet.

Right.

And he told me, okay, Andy did this, Andy did that. And I was doing some math in my mind and I evaluated, okay, it may take at least $100,000 to do all those stuff. And when he told me the actual numbers, I was totally blown away.

Oh, okay. You're talking about my one that was, uh, completed?

Yeah.

Okay. Yeah, there's another deal, uh, that he was also talking about that is in the very beginning stages. We just closed escrow on it. Okay. And that one is very run down. That's the one, uh, with the view of the golf course. And yeah, uh, you know, it's, it's filled. It came with all the leftover stuff. It's, you know, yeah, very dirty. Hasn't been occupied for, uh, I think several years at this point. Um, and so yeah, that one is the one that he was talking about, the potential for doing a wholetail situation.

Oh, okay.

Um, we're going to be cleaning it out. Uh, it's, it's about halfway done getting everything cleaned out and removed, and we're gonna put it back on the market as is, uh, to sell to another investor who can flip it, who can use it as a buy and hold. Um, you know, maybe there might be someone, you know, that's like a contractor or someone that can, uh, manage doing the work themselves, right? Um, either before they move in or, you know, do a little bit and then move in and do more as you, as you go along. Um, so yeah, that one was a really good opportunity.

Okay.

And, uh, so we're probably gonna be, uh, doing that, that wholetail situation. Um, I, I, you know, went back and forth. I still kind of go back and forth a little bit on Should I just flip it? But just with the timeline, it's a condo. It's got, you know, $630, I believe, is the HOA fee per month.

Yeah.

Plus, you know, all the stuff that comes with, you know, flipping a property, the timeline, all the expenses with the holding costs and that type of stuff. You know, it kind of just makes sense to just get in and get out as quick as possible and, you know, still make a decent profit doing a wholetail situation.

So I was actually curious about your thought process on how to determine whether you will take, take on this work or job on your own, or versus, uh, okay, just to clean it up and maybe flip this to other investors.

So it really just depends on, you know, the actual deal itself and what the acquisition cost is, what the ARV is. What the rehab is going to cost, and then how long the rehab is going to take. That's, that's the basic kind of calculation that I'm going through.

Okay.

And then, you know, demand for a condo like this is, is pretty high. It's in a really nice area. And so I think, you know, other investors, even, you know, after I kind of tack on my profit margin there, other investors are still going to be able to, to turn a good profit on it as well. And so that's, that's really what comes, what it comes down to when determining whether it's going to be a wholesale or a flip situation.

Okay.

Most of the properties I do, I end up flipping. It just, you know, it's going to make more sense that way. Put a little bit more time and effort into it, a little bit more, you know, management. And then I'm also a real estate broker. And so I, you know, sell them myself and, you know, market them and all that type of stuff. I do open houses. And so there's always that kind of, you know, calculation of the time commitment and everything else that's going to be involved with it. But, you know, it usually ends up being a little bit more lucrative to flip it. And so—

Yeah, of course. Yeah, I'm sure like our audiences, they, they, some of them, they will ask you, hey, to our understanding, right, if you follow a deal from end to end, right, you already got the deal off market and then you flip it and then you sell it to retail, like Either investors or actual homeowners, then you will make the top, top dollars out of this deal. So why, why selling this prematurely to somebody else? Right. Why, why don't we like just flip it? Take the, take the home run, right?

Yeah, that's, that's a question, but it's kind of just what your personal preferences and what your resources look like and what your kind of business model is. Because I mean, you could spend a lot of time doing the management, you know, searching out contractors, getting them in, monitoring everything that they're doing. Because you got to really keep an eye on what's going on at the property, what the end result is going to look like, if you're going to make sure that you're going to get top dollar at the end.

Okay.

And so, you know, you may flip a deal and make, you know, $80,000 or whatever it ends up being at the end of the day. That could take you 3, 4 months of time from acquisition to you know, close of escrow on the resale. But if you're doing wholesaling, you could potentially get, you know, 3 contracts that you make $20K each, and then you're, you know, ahead, or, uh, and do that within, you know, a month or 2.

Right.

So it's, it's kind of just whatever kind of your forte is and what your, your business model is. It's every, you know, you, you choose your own destiny. And so it, you can kind of make what you like be kind of your focus and just, you know, go from there. I mean, whatever, because everyone kind of has different things that they're, you know, better at or that they like more. And so you can kind of cater your business towards those things.

Exactly. I completely agree.

Amazing. Right on. Well, Andy, thanks for co-hosting. Brian, thanks for joining us. How can people reach out if they want to send you deals or want to JV with you? What, uh, what's the best way to reach you?

Yeah, just, uh, send me a message. Um, yeah, reach out to me at, uh, uh, 714-868-6762.

Okay. Yeah, right on.

Yeah, as simple as that.

Sounds good. Right on. Cool. We'll be back next week, uh, talking about some more co-living. Um, Joe, come back safe to us. And all of you, thank you so much. Please share this with any new or experienced investor in your life. And we'll see you next week. Thanks, guys.

Don't forget to like and subscribe.

Thanks.