In this instructional video, seasoned real‑estate investor Joe Homs walks viewers through the complete seller‑conversation process for wholesale deals. He emphasizes the importance of empathy and patience, urging wholesalers to first uncover the seller’s personal situation (job loss, divorce, death, etc.) before diving into property specifics. Homs outlines the critical financial data to collect—ARV, existing loans, and equity—and stresses asking the seller directly for their price expectation. He demonstrates how to compute a Maximum Allowable Offer (MAO) using a target ARV of $500k, a desired purchase price of $350k, and rehab cost estimates of $100‑150k, then explains how to justify that offer during negotiation by highlighting rehab expenses, commission savings, and covering closing costs. The video also covers practical logistics (appointment setting, meeting both spouses together) and the operational costs of wholesaling (subscription tools like PropertyRadar). Homs offers free leads and services to Orange County wholesalers in exchange for future deal referrals, and provides his contact information for viewers seeking assistance.
Chapters
Okay, welcome back to Wholesaling 101. My name is Joe Homs, real estate agent and investor for over 40 years, and we're here talking about Wholesaling 101 today in specific. Seller conversation— what, what, what are you going to ask the seller when you do get an appointment, whether it's on the phone or at the door or whatever? You need to be prepared. You need to be ready to start answering questions. First thing is what's happening with their situation. It kind of rolls into the next one, what is their situation? So the way that I approach things is I'm there to help people. At the end of the day, if we go through all this and I've sat there for an hour or 2 hours with them and I can't put a deal together, that's fine. I just move on to the next deal. So you have to be very patient with people. You have to listen to what they have to say, and you have to deal with their particular problems and issues that got them into this mess, whether it's a loss of job, a death in the family, a divorce, whatever it is. Those are the things you're going to have to deal with. They may be there talking about, you know, something that happened for 10 or 15 minutes. Before you actually get into the conversation of, okay, what's going on with your property in particular, the details, and let's see if I can help you out of this mess. You need to know what the, what the ARV is, the loans, and eventually the equity in the property because that's what you're going to be basically discussing is the equity in that property. They want to keep as much as they can. You want to buy the property at a great deal. And that's what you need to do is figure out, okay, what is all that? What are all those numbers? All that information you should have prepared beforehand before you get to the door. There's many times I'll knock on the door and I'll just make an appointment to come back later on. I always like to have husband and wife there at the same time. That way I don't have to repeat myself twice. So I'm not— if I'm knocking on doors during the day, You know, 1 or 2 in the afternoon and one of the parties is home, I'll just say, when's the other one going to get here? After work or whatever. I'd like to make an appointment to come back then. Go back home, do your homework, come back prepared. Biggest question to ask, the number one question is how much do they want? Please have them tell you, this is what I want. That's what you're going to use for the base of starting a negotiation. Understand that everybody is pretty much the same. We're all human. We all want the top price. Okay, you know, we don't want to sell our property for a discount even though it's distressed and haven't done anything to this property in 40 years. Well, whatever the reason, everybody wants the, you know, the top dollar, but you need to know what the top dollar in their mind is. And it's always very important that you ask them that before you even offer an offer to them of what you want for the property. What is your maximum allowable offer? So for example, if I'm at ARV $500,000 and I want to offer $350,000 as my maximum, I'll offer them $300,000. And then we just basically go from there. And I'll tell them I'm a full rehabber. What that means is that I come in, nothing wrong with your kitchen or bathrooms, but what I do is I come in and I take everything out. I start fresh. Everything's brand new inside the home. That's how I'm able to sell my homes quickly when I put them on the market because that's what today's buyer is looking for. They're looking for a rehabbed home with everything brand new inside, everything new and working inside. So that takes money. And, you know, a normal contractor is going to charge anywhere between $100,000 to $150,000 to completely rehab a house from, you know, top to bottom. And so those are the numbers that I use to justify my price being at $350,000. Okay, and then the last thing is negotiate, negotiate, negotiate. If their number is $500,000, you're at $350,000, it's just a matter of negotiation. If you started out at $300,000, go up $5,000 or $10,000, see how much they come down. Start justifying the price that you are offering them by telling them it's going to cost you $100,000, $150,000 to rehab. Have that number in mind. Tell them that they're saving in cost to commissions. They're saving 6% on a $500,000 deal. That's $30,000 there. Subtract that off the top. Most of the time I even pay closing costs as well. Because remember, closing costs on their side are about 1%. So it's not like it's the end of the world, but just say, hey, you know, I can give you this number. You're going to walk away with $20,000, $30,000, $40,000, whatever it is, thousand dollars, and you're not going to have to pay anything else. You're guaranteed that this is what I'm going to give you at the end of the day. So it makes it sound a lot better. when I'm negotiating with somebody. But the name of the game in wholesaling, in buying any type of properties for flipping, is negotiate, negotiate, negotiate. I negotiate with all my business partners. It's just a matter of if you don't ask, you're never going to get anything. So whether it's escrow, whether it's my contractor, you know, whether it's this person, that real estate agent, whatever, I always ask for a discount. And go from there. If you like what they hear, then fine. If you don't like it, then give them a number that you like and you know go from there. So hopefully with the other videos that I have before this one, you've gotten a great idea. And again, it's just a basic idea of wholesaling. Okay. What I want to tell you now is cost for all this. Okay, obviously there's some costs if you have apps like PropertyRadar that you need to subscribe to, lists that you're going to need to get. If you're working around Orange County and you want to deal with me directly, I'm happy to provide you with a lot of these leads and connect you with a lot of the services that I have. And all this is done free of charge. I don't charge anybody for that. What I do ask in return is that you go out and you become successful as a wholesaler and you start to get some deals. I want to be the first person that you call when you have that deal together, and then please offer that deal to me before you go farm it out to anybody else. So I can provide you with education, I can provide you with the tools, I can provide you with the expertise. All I ask And all this for free. All I ask is that you come back to me and tell me, okay, here's the deal that I have, are you interested? If I'm not interested, I'll just, you know, politely say, sorry, I'm not interested, that doesn't work with the numbers that I use and the numbers that I gave you before. And I know you're excited about getting a deal, but go, you know, basically farm that out to somebody else. Okay. Hopefully this helps you with wholesaling and answers a lot of questions. Again, please give me a call. My name is Joe Homs. I work with H&M Realty Group. I've been an investor for over 40 years. I'll put the number on the screen here that you can contact me at, and feel free to reach out if you're local here in Orange County. Thank you very much.
