Tom Zeeb - Techniques and Tips for Real Estate Wholesaling

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Welcome to the Untold Stories of Real Estate Investing. I'm your host, Wayne Courageous. Today I'm excited to have Tom Z with us. Tom almost went broke in 2001. A near death experience while white water rafting pushed him to find a new way to break free from his 9 to 5 job. His first deal almost took him under as well. But real estate investing saved him in the end, both personally and financially. Hundreds of deals later, he's happy to share the same negotiation, marketing and business techniques that set him free so you can do the same. Simple, structured and step by step. Tom works with real estate investors of all levels to get their business built correctly so that their personal goals and lifestyle stays at the center of everything they do, giving them more money, more time and more freedom to spend as they please. Welcome to our show tomorrow.

Thanks Wayne. Good to be here.

Well, got to know you a little bit beforehand. You were in Washington D.C. for a good while and now in Florida. So tell us about your experience in real estate and sort of how you got to where you are today.

Yeah, I built my real estate, got into real estate and then built a business up in the Washington D.C. area and then moved to Florida about two years ago. Two and a bit, two and a half now maybe. And rebuilding what I do, what I did up there, here with different rentals, I do a little bit of everything. Some rentals, some rehabs, but I am primarily a wholesaler. I love just quickly putting properties under contract and assigning them to somebody else. Mainly because it fits my personality type.

Yeah, so when you have these rentals, let's start there and then go into wholesaling and then I really want to pick your brain on negotiation. But on these rentals, how do you scale in the rental business? Because my understanding of it and I owned single family and did some rentals in my understanding. So you can only have like 10. Correct me if I'm wrong because this is why I do this podcast because I'm always learning. But like 10 homes under your name for or is that per.

Believe it might be four in general for mortgages outstanding. Here's the thing. I don't hold anything in my own name. They're all in different trusts. I'm either try maybe you get a mortgage on them initially. I usually try to use private money instead. And then you can always refinance out. There's a lot of different ways of doing it, but I prefer not to have particularly single family residential rentals in my own name because of the risk level.

So you do more of an LLC.

Per home or trust analysis.

Okay, and then you said private money. Talk to me about that.

Oh, private money is when you get other investors. There's a lot of people out there that want to invest in real estate, but they don't actually want to do the work to invest in real estate. So what they effectively want is their money secured by the security of real estate. So you can have them lend you money on deals and you pay them, you know, 6%, 8%. That used to be a very good return versus what a. What a bank would offer them. You know, it still is a decent return. It might be pressing up a little bit now. We'll see. But the. They'll lend you money and then you do your deals. Borrowing the money from somebody else and paying them interest on it.

Yeah, we haven't really talked about that on the podcast because we talk a lot about syndication, passive investing. You know, you're putting your money into an investment and seeing a return on that through cash flow distributions and then of course, the equity. But there's another way. If you, if you're sitting heavy on cash and looking to get into real estate or diversify. What you're talking about is they could potentially be the capital behind buying and renovating single family homes in particular.

Absolutely.

And then. And them not having to do it. But it's more. Do they get the upside of it as well or is it more of the return?

Depends how you structure it. If you're borrowing money for rehab, you might pay them out additional on the rehab, you might not. It's whatever two parties can come to agreement on. So you're, you're agreeing with them. What, what are they after? What are they looking. Do they want to get out of it? And then you think about what do you want, what do you after and what do you want to get out of it? And then you come to the meeting of the minds.

Yeah, it makes sense. I mean, the thing I love about real estate, it's a team sport. And you know, say that a lot on this podcast and it's like you determine like what is your core competency and what can you bring to the table and then what does the lender want or what, what does it take to close a deal? Whether it's a single family, a storage, industrial, multi, no matter what, it's all has the same principle of, you know, if you can't bring in the full capital, if you don't have the full net worth or you don't have the time to fully devote to renovating or repositioning an asset, then you bring other people who can fill those, Fill those voids.

Yeah.

And a lot of times we've talked about it on the bigger scale, but you know, I really just want to hone in here that you don't have to go on the bigger 100, 200, 300 plus units. You know, you can partner even on these single family rentals like you've done and you did that in Washington D.C. pricing is so expensive for homes anyway. It's, you know, know. So if they're private lending, are they the equity for the, for the mortgage or are they the lender themselves?

So kind of are the lender themselves.

Got it. So they would have to bring in. So in D.C. i mean what, what was the median household or probably like 700 at least.

Yeah. Depending what side of the city you're on. 7,800 million dollars in some parts it depended. But you could drop to 4 or 500 in a different sector just over the city line. Right. So it depended where you were.

Yeah. If you went down to like Fredericksburg and you wanted to do the two hour commute. People do it.

A lot of people do.

People do it.

That two hour commute isn't that bad if you're only doing it one day a week. So things have shifted again.

A lot of shifted. Yeah. We looked at a house and I think it was Stafford, Virginia, mfr. And I was looking at like the train that bring us into like Union Station when we live there. But it was on land and I really wanted to to be on some land. But anyway it didn't work. We had a good realtor who told us to get a septic and soil inspection and found out that that had failed. And anyway we got lucky. So. Interesting. So how did you find these? The capital partners.

Capital partners. You shop around for them? I go to a lot of real estate investor associations. I run one in the D.C. area and there's, there's a constant flow of people through that are looking to park their money into solid deals.

Yeah, I think it's important because it's like people want to always know, like, how do I get started? Or they feel like they have to be saving, you know, 50, 100, 200 plus, whatever, thousands of dollars to go in and buy that. But straight up networking goes back to the team sport of going and networking. Going to what? Meetup.com and searching, real estate investing, meetups, etc.

You mentioned finding somewhere to start. If you, if you're waiting around to save up 50 grand, you're going to be waiting a long time.

Right?

It's hard to save that amount of money. What I'd rather see people do is I teach people to go and earn it. Earn it from wholesaling. Go, go learn. Go learn marketing. Negotiate a solid deal, put it under contract and sell it to somebody else who wants to landlord it or someone who wants to rehab it themselves. And they'll pay you to take over that deal when they pay you to take over. Now you've got your nest egg to get into whatever other types of deals you want to do.

Yeah, it's a great segue to wholesaling. So we've talked about a little bit on our podcast, but for those that didn't listen to that one episode, tell us what wholesaling is. And I mean, to me it seems like a lot, a lot, a lot of work, but tell me.

All right, I want to correct you on that.

Yeah, I just wanted another conversation.

Yeah, it's just an exit strategy. Just like buying and holding, just like rehabbing, it's just a different exit strategy. You still need to find the deal through good marketing. You got to negotiate the deal to make it into a deal. Then you get to do your exit strategy, which in my case most time is wholesaling. I want to sell it to somebody else. So if rehabbers are always out there looking to rehab properties and if landlords, you know, buy and hold investors are always out there looking to buy and hold properties, well, they all need to find the deal, then they need to make the deal, negotiate it. Then finally they get to do their chosen exit strategy, which is fix it up and resell it or hang on to it as a rental. Well, as a wholesaler, what I do is I go find it, I negotiate it, and then instead of settling on the deal myself, I sell it to one of those other types of investors and they pay me to take over my position in the deal. So I'm not actually selling them a property, I'm selling them my position in A contract to buy a property.

Yeah, but the hardest part, and I respect you for doing this because like the hardest part in real estate transaction is finding the deal and negotiating the deal. Plus you've got to negotiate the deal at a price, correct me if I'm wrong, at a price lower than what the market would accept or because there's money to be made that way. Or are they paying the fee or, or is there a different way to wholesale where you, you can pay market to get?

No. So I, I think a lot of so called wholesalers that seem to be doing it half rare ended get out there and are messing everything up because they're trying to like, oh, just going to grab something at whatever price, lob on a fee, everything keeps going up. That's nonsense. I work my numbers in reverse. I start with what will the rehab, what are they looking to pay for property? If they are out there looking for it themselves? Right. What are they going to pay? That's the price I know they're going to pay. So I go and negotiate better than that and how much better than that I can get it for. The difference is my spread, that's my profit.

So how do you know what the value of that property is though? I mean you must like, do you zone in on certain neighborhoods where you're just like the matter expert in those neighborhoods or like, or do you partner with a realtor to help you get access to mls or do you have access?

Yeah, all of the above. I do zone in on certain neighborhoods but honestly with my marketing I sometimes you get stuff in random spots that you weren't specifically marketing to because I market as much to a, a type of person or person in trouble, person with a problem, and then probably could be out of range from my normal area. So I got to know how do I handle myself in that area? You get in there and you run comps for the mls. What is this property worth once it's all fixed up bright and shiny and new? And then how much is it going to take to get there? I got to know that number and then I got to know the seller's lowest price, which means I need to ask and negotiate towards it.

Yeah, interesting. So from a. You had mentioned in that that you find people that may be struggling or need to sell. How do you, how do you find those people?

Yeah, well, life presents people with problems and when they have those problems they often need to ditch their property and move on. Like selling that property will solve their problem. Sometimes it's the biggest chunk of change a person will ever have is from the real estate that they own. So when they get into a big old problem of some sort, they can sell that property and get out of it. And I pay their way out of it. So you think about a number of situations that would cause somebody to need to sell a property, maybe even more than they want to, but they're stuck. What if they're getting divorced and can't afford it anymore? What if they're going into pre foreclosure because they can't? Maybe they lost their job. Maybe they're a tired landlord, they're sick and tired of evicting tenants or dealing with the eviction moratoriums that we had for a number of years. You know, they've been falling behind. What if they are an out of state absentee owner? What if they've inherited the property? Right, They've inherited a property in Texas, but now they live in Chicago or they live in L. A or they live in Vegas or New York or wherever they don't want to have to come. You know, grandma passed away, they inherited the house, or their parents passed away, they inherited the house, but they're going, geez, I've got a, I've got a job here, a family here, a life here. I don't have time to go back to Texas and deal with this. Right? So I can step in and say, I will take this off your hands exactly as it is. You don't need to, you don't need to put up penny into it. Just sell it right now. And they're. Because I'm solving their problem and they're happy to have me do that.

So maybe this is part of your course. So I don't want to like spill the beans on the podcast all but again, how are you? Like, there are a lot of people that have. Life happens for everybody. Are you doing mailing like mailers out? Are you, are there website? Like, I mean, obviously from a tax standpoint, you know, you can go to the appraisal or the tax website and you see, you know, if anyone's behind. So I, I get that that's probably. And I, I have a friend in Montana who has been very successful at that, you know, going and buying properties that have like tax lien type issues and, and it's worked out really well for them. But you know, for those people that are getting divorced, I mean, you have people on your team tracking, you know, divorces or what's going on. I mean, how far do you get into this to find people you're fishing in a way.

I know. So I, yeah, I want to clear. I don't, I don't feel like a bottom failure. I'm out there helping people.

But no, I didn't mean it negatively. You're trying to find the, the people that need the, the help.

Finding the motivation to. People need the help just like anyone else that would need the market to somebody particularly. But a lot of people think investors have this bad reputation where these mean evil people out there trying to it. It's. No, not we're doing it with good intention. Here's the thing. Most of these issues that people get into are a matter of public record. Right. Divorce is a matter of public record. Death is a matter of public record. Pre foreclosure is not quite public, but you can still get access to it. Being an out of state absentee owner is a matter of public record. Evicting a tenant is a matter of public records. So yeah, I have, I have teams that research those names at courthouses and then I get those names and market to them with letters, postcards, mailings, targeted. Targeted direct mail.

I love this podcast is so powerful. I'm telling you. I'm getting excited.

Listen in. All right.

We've already talked about if you can't do it on your own, you get a team, you get, you go to conferences, you network. Right. But now we're talking about finding deals and I was, and I was looking for that answer you're talking about. All this stuff is public. You know, you can go out and it just takes work. It takes work. A lot of work.

So what's a four letter word these days? It's a four letter word.

But you have a team too, you know.

Yes.

Doing it. And I'm, I'll give, you know, give a couple advice tips here for people looking. They don't have the time. Even go to upwork and find people who do this. Skip tracing this stuff in the Philippines or other parts of the world where you know, you're not, you know, they, they have access to databases. They have access to public record that Tom's talking about. And while you're sleeping, friends that you know, need jobs etc overseas, they're building this database and they did it, you know, for, for me on our properties we found an off market Tom through going to. We had a list of properties and I always tell people my sick, you know what we do because I want, you know, everybody has their own tree and there's so much real estate and we're not all compete. We're not competing right. In the day though. Like you go to the Harris, you know, in my case it was the Harris County Appraisal district. You put in the address, you find the recorded owner, then go to the state secretary of state website for Texas, put that entity, find the true owner, you know the people behind these entities. Sometimes it's locked up behind attorneys etc but sometimes you know, and then you. I use been verified found numbers but I say I did all this but I didn't do all that. Like I was the leader and saying like hey this is the steps I need to get done. But I outsourced a lot of this work that was just a lot of administrative time consuming tactics with the team that you mentioned Tom, to help you get to your goals. So that's the thing about real estate is like you don't have to do everything yourself, even the grunt work, the administrative work to find that property which I mentioned is my opinion the hardest thing in real estate investing. You know, you can use a team on that. So I'll be quiet there. Anything you want to add to that?

No, that's it. Is it the hardest thing? Yes. And yet that's what's going to make or break your investor. Interesting. Is the hardest thing and yet every single type of real estate investor needs to do it. You can't escape, right? If you don't find deals, you're not going to have anything. What happens in the wholesalers case, that's why I don't consider any more or less difficult because we all need to find the deals. It's just instead of deciding to rehab it myself, I sell it to a rehabber. Instead of deciding the landlord myself, I sell it to a landlord. So in many ways I'm making their life easier because they get to carry on doing what they want to do.

Yeah, absolutely. Well and it goes back to like everybody think about real estate. There's different ways to one make money but there's different ways to enjoy the parts of real estate not everybody enjoys the day to day operations lifecycle property. I have that sickness. I do enjoy that piece. I don't have. I don't enjoy as much the capital raise piece, just that's just not my person. I have to do it because it's. I've got to close on deals. Right. But my comfort personally is day one of closing and you found what you enjoy and what has worked really well for you and what your experience has led you to this point and then you're finding other people to take it and do what their passion and what their experience allows them to do. I think it's fantastic.

Yeah, it's been great because it lets me focus on. Like you said, I get to focus on the parts I love. I enjoy marketing to find the deals and I really love negotiating to make deals. And so I get to focus on that and just, you know, and then sell them on, not have to deal with everything else. I can get back to finding more and negotiating more. I'm a happy camper.

Yeah, man, this is incredible. So people that are even working full time and I had to leave my W2 job a few months ago because it just became too much. I wasn't doing what I thought I could do. I wasn't doing what I needed to do full time with the W2 just because I. I couldn't. And same thing on the, on the. The what I called a side hustle, which was a full time hustle for several years. Right. It's two full time jobs. But for those that are not wanting to do the full aspect of start to finish network, you can do those networking events on the weekends or at lunch, get to know people and then try to find these opportunities, as Tom said, through the public records, outsource as needed. If that is. If you don't have the time, do that and find these deals. Because there are people looking for good opportunities that when you sign that contract sounds like when you put a entity or the trust on the contract to sign, it's likely there's an option to that. It's assignable, right? There's a opportunity.

Yeah. My contracts are all, all assignable. I do, I do most of them. Not even the holds are entrusted. But my wholesale deals are inside of a self directed Roth IRA so that avoid tax as well. It's a beautiful setup.

Okay, well, we need to talk about that like. All right, but let's first hit on.

A whole nother conversation, a whole other conversation.

We're gonna have you back. This is a great. But when you do the contract, for those listeners listening, do it where you're able to assign the contract and then based on your prior work of networking and building those relationships, you'll have those people. Or reach out to Tom and see, you know, with his network and resources as well, to, you know, transfer or close those deals. Hey listeners, it's Wayne Courageous. I just want to pause real quick to say thank you for listening to our show. I hope that you're getting a lot of value out of it. If I could ask you to go ahead and like subscribe and share this podcast. That would mean a lot. It will get a lot of other investors like yourself learning about the process and the steps to successfully invest in real estate, either as a passive or an active investor. I also want to do a quick introduction of CRI partners. I'm the managing principal for CRI partners and we started it back in 2019 with one goal, to grow your wealth passively in real estate. We do so by buying assets in multifamily, build to rent communities and RV boat storage facilities. And we do so in areas that have strong market fundamentals and also have strong partnerships with, with other real estate investors such as ourselves. We personally discovered that passively investing in real estate was a really great blend for people that are busy like yourself, and that you can invest passively in real estate and still reap the rewards of the returns, the tax benefits, et cetera. If you're interested in learning more about passively investing, check out our website. We do a lot of content through our passive investor coaching program, through our podcast, our blogs, and just other information that we do on a daily basis. Check out creipartners.com Again, CRE partners.com if you're interested in building the relationship and joining our investor club, there's a link there to, to join. We'll set up a call and continue building the relationship with you. We're super excited to have that opportunity and I want us to get back to the show and hopefully again you're enjoying the conversation and look forward to connecting soon. Thank you. All right, so let's talk a little about negotiation.

Yeah.

Unless you want to hit any more.

Topics on wholesaling and it's a negotiation. It's my.

All right, so we're, we're like ask. All right, we're going, we're finding deals. We got the team. All right, so now you've got this opportunity where you feel like you're, you're able to buy it at a price where you're a wholesaler or not wholesaler, but someone else will want to come and take it in. How do you, how do you negotiate? How are you negotiating?

Yeah, I've got to get it to the price that I need it at. So there's, there's kind of three main things I focus on negotiation. They're my three Ps. So the first is pinpoint. I gotta pinpoint what the problem of the person I'm talking to is. And I do that by talking to them, you know, asking them questions. What's the problem? What's going on? What are you after? Get them to kind of see the what the way out could be. So I'm digging. I keep peeling off layers of the onion on their issue and getting down to the core of what's wrong. Once I've pinpointed the problem, then I can package up a solution for them. So they've told me what's wrong. They told me what they want. I can put together a package to make that work from the cell of their real estate. Then that only leaves the third P, which is to persuade them to say yes to me. Because most people stay stuck on no unless you have a specific way of moving them to say yes to you. And that's what persuasion is all about. And that's kind of the. It's both the art and the science of negotiation. It's not just, it's not just the art, it's actually more the science of negotiation that matters. There are certain techniques you can use, certain ways you can handle yourself, certain things you can say that. It's the science of what that is that works because you get a predictable response from 98% of people. And so when you use certain techniques, you know you're going to get a certain response, you know, whether or not you have somebody willing and motivated enough to turn it into a deal.

Yeah. Starting with the first P. It tell me if I'm right or wrong on this because it's my perception of my experience in the real estate industry. But negotiating residential is a lot of times based on emotions and pride. And in commercial, it's a lot of spreadsheets, numbers, cap rates, very much more financial based. And part of that is because there's a lot more investors may be involved, there's returns. But on the residential, when you're getting to know someone and finding out what, what can you help them with, it really is more important to have that people. It's a people business. And if you're coming in and you're trying to determine what their needs are, what, what's impacting them at this time. I mean, you have to have empathy and a lot of emotions may go into it. So I'm curious on your.

Absolutely. Residential is going to follow almost always more that emotional track. Right. There's, there's something wrong, they want to get rid of it. Commercial, by its very nature, the, the people are more business people to begin with. Right. They're not, but there's still an emotional end to it. Like a lot of times I find some of my students that deal with commercial properties. And we talk about how to craft the marketing message to match their market so well, you know, let's, let's, what problems do people get into? Well, people get older, right. They get in the old age. They no longer want to manage the properties. They're looking for an exit strategy out. That's when they decide to sell. Or sometimes the property becomes overwhelming or it's change or it's fallen into disrepair. The same thing can happen in commercial. So yes, there's a little more, what would I call it? Like people are more clinical in general, but there's still an emotional element to it because you got to remember there's people behind every property and people have problems and those problems are on the emotional side.

Yeah, well said. Yeah, I, I, I definitely agree with that. I mean the day there's different needs and things going on, even on the commercial side, where if you're negotiating to like for. I'll give you an example. We bought a multi family property last year in Houston. It took two years. We found it off market. It took two years for us to close on it. Because the seller, he had owned it for many years and just loved that property. It was his pride and joy and eventually he was like, you know, I don't want the headaches or stress of it anymore. And because we had built that relationship, it was taken more of the long game to get to that property. But more than that, we, you know, became really good friends from that too. So. And that was a commercial 100 plus unit property. So to your point, emotions, does, can and does go into the commercial as well.

Great property for you. And at one point it was a great property for him. But then he got old and eventually got tired of it. There's nothing wrong with that. That's a, that's the story told probably a hundred times a day. So our job then if you're looking for commercial properties, go, go find people just like that. They're out there. If you don't find them today, you'll find them tomorrow. Yeah.

All right, so we talked a little bit about the first P. What was the second P again?

Package. Package up the solution.

Package the solution. So at that point you already, you're sort of in the upper hand possibly at this point because you know what your abilities are to leverage a win. Win.

Yeah, I would say I have, I, I have the upper hand because I know overall the negotiation process and I'm about ready to unleash the techniques on them to, to really persuade them. But I, at the End of the day, I'm aiming to help somebody so I'm bringing them through the problem so I can understand how to help them. I'm packaging up a solution that will actually help them. Yeah.

And by them going direct to you too, they're saving on commissions. And some of these commissions that sound a 700,000 plus property or, you know, even a $300,000 home, you know, is quite substantial. So not only you're helping them with the ease of the sale, but you're also saving them money too, from a transaction side or are they having to pay commission?

No, there's, there's no commissions on. Because I'm not licensed, I'm actually on the contract. That's what gives me the right to sell it. I'm on the buyer, so I can, I can sell my equitable interest. But the interesting thing is sometimes, sure, they, they think they're saving a commission. I, but when I've negotiated with them, I get it for less of a price than what it would have been anyway. Right. Sometimes the. Usually the property isn't in good enough shape to be selling on the open market. I mean, the time. If you think of the, the properties that agents like to see, they're bright, shiny, fully renovated. I mean, they're picture perfect, they're magazine ready. I like dealing with rundown, dilapidated properties that are in trouble.

Right. All right.

And what about that last Pete Persuade, My favorite part.

All right.

Certain techniques that, like I said, that's the art and particularly the science of negotiation. Okay.

And so you have a program. Talk to us about your mentorship program.

Because, yeah, it's your website.

You got a lot of resources. And when I started, so many of the listeners have listened through our podcast, know that my background has been heavy commercial real estate last 16 years. But in 2019, I got more into multi family and our investments. But when I did that, no matter how many years of experience I had prior, like, it was really important for me to get a mentor, somebody I could call, someone who can open up their list. And so that's why I want to tee it up to you, because those people that are listening in and thinking about wholesaling or getting into, you know, fix and flip or any, you know, type of real estate investing, having that person to go to, who's been there down the road has that experience, you know. So tell us about your mentorship program and how you. You seem to come across, Tom, as someone who's always wanting to help. You're willing to help people get out of Situations with their homes. But you're also wanting to help people flourish in real estate investing.

Just like that's something my students say a lot. I'll, I'll thank my father for. Somehow I wound up being patient and don't mind answering questions. So, yeah, like on the coaching side, but particularly on negotiation, let me, let me show you an example of how we could turn somebody around. So I want to teach you like a quick three negotiation persuasion techniques. All right? You'll benefit from and all your listeners will benefit from. And then that is an example of how I like to teach it. So, Wayne, say a number.

Three.

Three. Whoo. Really?

That's my favorite number.

Okay. How did you feel about my reaction to your number?

You seemed super excited or surprised. Too low?

Yes, it was too low. Too low. Too high. Right. It was too whatever it was. Too not correct. It wasn't the right number that I was expecting. Why? Because I flinched at your number. So my all time favorite negotiation techniques is the flinch every time you hear a number. Any. It doesn't matter what it is. Flinch, act like you were physically attacked by the number. Whether that be, you know, if you're face to face. You can be a little more expressive. If you, if, if you're just on the phone or you might just be listening to this, you hear my, you know, you can hear the surprise of my voice at that number because that immediately puts those thoughts in your head, which is exactly what you said. Like, well, that number's not right or it's too high, it's too low. It's. It's just not right, whatever it happens to be.

Yeah, well said. Love it.

So super important that every time you hear a number, you do that, no matter what. All right. It'll make you a better negotiator just from flinching. Now, the second technique is it's called bracketing. And I'm going to have to explain that work. It's not obvious. Wayne, where do we tend to meet? Where's the most fair place to meet? I like.

Well, whoever has the negotiation power. So, like whoever's at. So if you're joining a meet, sort of a place where I know and I'm comfortable. Yeah, I've been there maybe before.

Sure. But now I'm giving you the advantage. What. Which puts me at a disadvantage. What's. What's more fair? Where should. Where should we meet to be fair?

Their place in the middle.

Well, oh, yeah. If we meet at my place and I'm in the power and you're not.

We'Re going to meet in the middle.

We're going to meet in the middle.

Like the Red River Shootout. Oklahoma.

Yeah, exactly. Dallas, Texas, right? Yeah.

Oklahoma's this weekend, so.

Oh, cool. Look, if it's we meet halfway, I'll meet you in the middle. It just seems fair. Right. So we know that most negotiations will tend to move towards the middle. Maybe not exactly the middle, but the middle. Right. Roughly that middle. So we know that therefore, if I. If I. What I call bracketing, we're going to bracket, which means we engineer where we want the middle to be. So let's say I'm trying to get a house for $250,000. That's my target price. If I get it for 250, I'm in good shape. But when I ask them, hey, how much are you asking for the property? They say 300,000. Oh, what about exactly. Good work. First, you flinch because all. All my negotiation techniques are layers. You keep stacking on the layers. You stack them up, and you say 300,000. Now, wait a minute. I'm trying to get to 250. They're at 300. How high are they?

Well, they're 50,000 higher.

$50,000 higher. So if I'm going to make 250 the middle, where do I need to go?

50,000 below.

50,000 below. Makes sense. So I'm going to bracket because knowing that we're going to move towards the middle, that way, it feels like we both gave up something and we came to a meeting of the minds in the middle. So let's see. 50,000 low. That would put me at 200,000, wouldn't it? Yikes. Wayne, I would never offer $200,000 for that property because of the third technique I want to teach you, which is specific numbers. I would never offer 200,000, but I would offer 200. 3,000, 579. Yeah, very exact. What. What does that make you think and feel about my offer?

Well, it makes it feel like it's higher than 200.

Yes. 1. What else?

It makes it think that you have tried to maximize your purchase price to the best of its ability.

Okay, does it sound like I'm making it up, or does it sound like I've seriously considered it?

Yeah, you've. You've considered it. To get to that 795, you know, number at the very end, you know, you've done. You've crunched your numbers to get to the maximum number you could.

That's how much more seriously my numbers take it. Now, to be Honest, I didn't crunch any numbers. I pulled that out of thin air. All my numbers end in 579. I love those numbers. It. But there's nothing specifically magical about those numbers. It's just the fact you use a specific number. You can use, you know, 113, you can use, you can use, you know, 586, you can use 902. It doesn't matter. What matters is that you have a specific number because then that idea that you've really scientifically calculated, this is what comes across and your offers are going to get a lot more, they're going to carry a lot more weight, and people are going to take you a lot more seriously. So just using those three techniques massively change the way you are as negotiator, whether it's commercial, residential or, or whatever. Non real estate. It doesn't.

I was gonna say that you could go to a furniture store and use this technique. My wife is a great negotiator. I, I'm, I, I don't do as well personally on, you know, when we go out furniture. I just don't want that whole process. Now in real estate, yeah, it's different. We talked about emotions and pride versus business. Right. But it can be really fun. And one of my MBA classes, it was a negotiation class and they were like, start off with a paperclip and see what you can get by the end of the class through negotiation and trading, you know, trade ups and all. And it was just pretty interesting because your point, like, we're talking about this on the real estate side, but this can be when buying a car, you know, negotiating, you know, large or small purchases.

Yeah. Makes a big difference. When you ask what, you know, what do I do with my mentoring students? I teach them marketing and I teach them negotiation. Then the exit strategy choice is up to them. I mean, I'll work with them on any of the negotiation strategies, but we, we aim to figure out what's going to be the best fit for you. Now, you know, if, if you're looking for fast money, stick with wholesaling. If you look for big money and you can float it, then go with rehabbing. If you're looking for steady money, you know, drip, drip, drip, and appreciation over time, then go with buy and hold.

Yeah, this is, this is a awesome podcast. A lot of information, a lot for our listeners and for myself personally. So I won't forget the three P's and I won't forget the reaction anytime someone tells me a number, even if it's at what burger? McDonald's. Like, ah, come on, let's, let's. Can we get that down?

I don't. You might get the 10 manager's discount. You gotta try.

Well, honestly, I mean, it's a good point. My wife, she gets mad at me because I don't use the veterans card enough. I just, you know, and they all. A lot of restaurants, they'll do it. My dad's very proud. Like, he'll, we'll be at Red Lobster or Longhorn Steakhouse and he'll ask for it. I'm just like, I don't know. But that's, But I mean, it's substantial. Now when I'm at Rudy's barbecue and I spent a lot of money on barbecue for, you know, a party, I'm like, I want my disc. I have a better discount. Here's my, here's my license. Just veteran on it. So anyway, all good. Well, how can people. Well, actually, I skipped this question. I always ask this question, what is your proudest moment in real estate investing? And then how can people reach out to you?

Tom? Proudest moment in real estate investing? Let's see. Usually it's when it's when I asked the, the seller for a testimonial letter about how I help them. And I get some whoppers, get some things that you just don't realize how much it really had an impact on people. I had a woman give me a letter one time that she said, you know, I've been wrapped up. Thank you for your compassion. While I've been wrapped up with this, for two years, I've been stuck. You finally got this unlocked and I can finally mourn the death of my husband. It's things like that where you suddenly go, you realize the impact you're having on people and, and that's. That's major huge.

Well, not. That is. It's a great to have those testimonies. I love that you're asking for those testimonials or asking for that feedback too. That's pretty awesome. Well, how can people reach out to you?

Best spot is to go to tomze.com t o m z as in zebra, e b as in boy.com and there's a whole podcast there on negotiation. So there's, there's more great negotiation techniques. You'll understand a lot from that. And if you prefer more video format, you can go to Traction Real Estate Mentors dot com. There's also information about my training program there. It works nationwide. I've got students all across the country, Texas, and not all 50 states. It works in all 50 states, but I have students in probably a good 2830 states now, so it's fantastic. It's there for you as well. This tractionrealestatementors.com awesome.

Tom, thank you so much. Really enjoyed learning from you just in this short amount of time. I mean, it was like 30 minutes or so. We we knocked out a lot. So thanks for being on and hopefully get to know you more in the future.

Sounds good. Thanks for having me.

That's all for this episode. We hope you subscribe, share and leave a review of the show. For more information about passively investing in more multifamily apartments, check out Wayne's free ebook by going to forward Slash ebook. Also, follow us on Facebook by searching CREI Partners. This was the Untold Stories of Real Estate Investing.