2018 Top 10 Award Winner: Ted Snyder! This is episode #410, and my guest today is Ted Snyder.
Ted is living the proverbial real estate investor dream. He’s bought around 650 houses over the past 10 years or so, and trotted the globe while doing it…visiting 35 countries during that time.
Though he lives in California now, he buys properties virtually, all over the country. He doesn’t spend money on advertising, and doesn’t even have any employees. What is this magical investing model you ask? Ted buys at online auctions for most of his deals, which has enabled to live the life of his dreams.
We talk all about it in today’s episode.
Please welcome Ted Snyder to the show!
Highlights of this show
- Meet Ted Snyder, Virtual Real Estate Investor.
- Learn how Ted has purchased over 650 houses virtually, outside of his own market.
- Join the conversation on how to get started buying at online auctions.
Resources and Links from this show:
- Ted Snyder on Facebook
- Investor Fuel Real Estate Mastermind
- Xome Online Real Estate Auctions
- Fair House Deals
Listen to the Audio Version of this Episode
FlipNerd Show Transcript:
Mike: This is the FlipNerd.com Expert Real Estate Investing Show, the show for real estate investors, whether you’re a veteran or brand new. I’m your host Mike Hambright, and each week I bring you a new expert guest that will share their knowledge and lessons with you. If you’re excited about real estate investing, believe in personal responsibility, and taking control of your life and financial destiny, you’re in the right place.
This is episode number 410, and my guest today is Ted Snyder. Ted is living the proverbial real estate investor dream. He’s bought around 650 houses over the past 10 years or so, and has trotted the globe while doing it, visiting 35 countries during that time. In fact, he lived in Germany for a while, and was buying and selling houses while he lived there, pretty incredible. He’s going to share that story with us. Though he lives in California now, he buys properties virtually all over the country. I don’t think he buys any in California. He doesn’t spend money on advertising. He doesn’t have any employees. What is this magical investing model you ask? Well, Ted buys at auction, online auctions for most of his deals, which has enabled him to live the life of his dreams.
We’re going to talk all about it in today’s episode. I think you’re really going to enjoy it. Please help me welcome Ted Snyder to the show.
Hey, Ted. Welcome to the show.
Ted: Hey, Mike. It’s great to be here from sunny Southern California. How are you?
Mike: Yeah. I mean, it’s not that sunny in Dallas right now. It’s been weird. We’ve had days where it’s 80, and then the . . . because the time of the year it’s 80 one day and then 30 the next day, so looking forward to getting past that. But, hey, I’m glad to have you here. I’m excited to talk about your model. We’ve been friends now for a while. You’re a member of the Investor Fuel Mastermind, so we’re excited to have you in there, but, man, you’ve done a lot of volume, and you’re doing it pretty much on your own from wherever you’re at in the world. So, pretty cool stuff. I think people are going to enjoy the show today. Why don’t you tell us a little bit about your background?
Ted: Yeah, definitely. So I’m originally from Southern California, but since then I’ve lived in Philadelphia, New York, Munich, Germany, and, most recently, then back again to L.A. And thank God it’s warming up. It’s in the 90s now, but we were suffering through weeks of temperatures in the 60s, my gosh.
Mike: Oh, yeah, that’s cool. People in Minnesota are laughing right now, but . . . yeah.
Ted: That’s my joke that I tell my people back in Baltimore. But, anyway, yeah, so I’ve been doing real estate full-time since 2008. And since I started, I’ve done about 650 deals, all virtually. I’ve never done a deal in Southern California, New York, or Munich, so all remotely. Love what I do. I mean, I think real estate is awesome just because it’s so tangible. I mean, I like, kind of, the fact that this is a real place, a house where a family is going to live.
You know, and I got in . . . you know, after I graduated from college, I went the corporate route. I worked for Jones Lang LaSalle, and it was good, but I’m more of a deal maker than an order-taker, so it just wasn’t for me. And then I went to a small real estate development consulting firm, which I loved, great group of people to work with, and kind of got a few deals going on the side, and built that up to the point where a job became more of an inconvenience. So it was hard to leave that company because I really loved the people, but I just didn’t want to have to ask to go on vacation anymore.
Mike: Yeah, exactly. We’re going to talk about the lifestyle part of this, some of the benefits. But, yeah, so, your model . . . so, when you kind of moved out on your own. So, when you moved out on your own, what was that? You were maybe making more money than you made in your job, or you saw the light that, “Hey, I could make more money than in my job, and have the freedoms that I want?” What, kind of, drove you there?
Ted: I mean, both. I was, like . . . it just kind of took off, and the model back then was super-simple. I was focusing on the Rust Belt like Ohio and Michigan. Those were really . . . and Indiana. Those were the three states I was working in. And I was just buying property on the MLS, getting pictures, putting the properties on eBay, and wholesaling them, and I was like, “Man, this is easy,” and I just caught the bug.
Mike: So what’s the cheapest, and what’s the most expensive house that you sold on eBay?
Ted: The cheapest one on eBay was a house I had in Flint, Michigan. I bought it for 4,000 bucks. It burned down, and I sold the burned-down house for 500 bucks.
Mike: Oh, you bought it . . . you paid $4,000?
Ted: I paid $4,000. It burned down. Fortunately . . .
Mike: Oh, it burned down after you bought it?
Ted: It burned down after I bought it, and fortunately I had insurance on it. And then I had to resell it, so I just put on there, “Fire-damaged house, Flint, Michigan,” put up the pictures and sold it for $500.
Mike: So 500 bucks. And then what’s the most you’ve sold a house for on eBay?
Ted: So, on eBay, the most I’ve sold a house for, I’ve sold some condos on eBay, I think in the $50,000 range, but the most expensive thing I ever sold on eBay . . . well, two things. One was a five-acre private island in Nicaragua. I actually picked it up. I had sold a house to this couple in Canton, Ohio. They’re from South Padre Island, Texas, wonderful people. And then I call them up seeing if they were interested in buying more, and they said, “Well we’re not interested in buying more, but can you help us sell this five-acre private island in Nicaragua?”
So I put it up there on eBay, and a pharmacist in Texas actually won the auction and called me up and said, “Well I bid on it because my son said to buy it, then my son said, ‘Well, Dad, I was kidding.'” So I think that was $300,000.
Mike: Oh, wow.
Ted: And then I sold an Italian restaurant in Maui. I sold that for $700,000 on eBay. It was a friend of family who was selling that.
Mike: That’s incredible. We could probably have a whole show on those things. Certainly, you and I need to talk more, I want to learn more about those stories. So that’s hilarious. And you’re not selling houses on eBay at all, anymore, now, right?
Ted: No. Probably, as of a month or two ago, I sold my last one. The eBay model has totally crashed. eBay made a lot of changes to the website, and kind of fell behind competitively. I think people go on Amazon now. They didn’t treat the sellers well. Before I would have lots of bidders on a home, people were excited to buy it. Now it got to the point where I could put it on eBay 10 times, and all the buyers would just flake. So something in that eBay model changed. Plus, the inventory on the MLS is a lot tighter. You can’t buy these $5,000 and $6,000 Ohio houses anymore.
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Ted: . . . I would have lots of bidders on a home, people who are excited to buy it. Now it got to the point where I could put it on eBay 10 times, and all the buyers would just flake. So something in that eBay model changed. Plus, the inventory on the MLS is a lot tighter. You can’t buy these $5,000 and $6,000 Ohio houses anymore.
Mike: So, now you’re primarily buying houses from auction, and I know we’re going to talk some more about that. So you’ve bought hundreds of houses at auction now. So talk a little bit about that model. Well, I guess, before we, kind of, get into the auction model, let’s talk about why you do it. So I know you’re talking about adding some staff now, or a virtual assistant, but for the most part, you’ve been a one-man band, kind of doing this all yourself from wherever you’re at, right?
Ted: Mm-hmm. Yeah. So, I mean, why I do it, one is . . . you know, I mean, let’s be honest, it pays the bills. I mean, I’m not going to be altruistic here and say I’m doing it for, like, you know . . . it pays the bills, it’s good money, it’s a great lifestyle it’s kind of . . . what I’m doing I consider low-risk, and allows me to take a lot of vacations. I’ve visited 35 countries in my lifetime.
But, beyond that, I guess my “why” is I really do enjoy the tangible aspect of real estate. I mean, just knowing that when I rehab a house, I’m kind of taking this sad, depressed, dilapidated thing, and I am totally rehabbing it. It’s, kind of, like a phoenix rising from the ashes, and I know that there’s a family that’s going to move in there, that’s going to buy it from me, that’s going to have pride of ownership. Their kids are going to grow up there. They’re going to make memories there. And, I mean that’s almost as big as any paycheck as well.
Mike: Yeah. That’s awesome.
Ted: Just like seeing a transformation and knowing that somebody is going to love this house.
Mike: Yep. That’s awesome.
Ted: I just sold two houses in Florida, both to veterans, and . . .
Mike: I saw one of those, man. I couldn’t believe how high-quality the rehab was. That was great.
Ted: Yeah. [Inaudible 00:10:24].
Mike: So talk a little bit about the . . . I know you moved to Germany, and obviously you traveled around quite a bit in Europe, but the whole time you were there, you were buying and selling houses every day just like if you were at Southern California now, right?
Ted: Well, not every day, but, yeah, pretty . . .
Mike: Okay. But, I mean, you focused on doing that every day, not that you were buying one every day, but you were focused on the running your business from afar.
Ted: Yeah. That was my full-time business over in Germany, and so I had . . . you know, I kept my New York cell phone. I just ported that over to Vonage, had it ringing in my apartment. It was awesome because at 3:00 German time, it was 9 a.m. New York time, so I could kind of have the whole morning off to go sit in a beer garden with my wife, and then roll in to work around 2:00, kind of have an hour of quiet before people got to work, and then just kind of get my work done.
And you had made a good point about having block time getting up 5 in the morning, turning your cell phone off when it’s quiet. And that is super-powerful because during the day I find there’s a lot of distractions: email, phone calls, and having that whole morning in Germany, just totally quiet, it made me so productive. I could get up at 9 a.m., and it would be 3 a.m., so I’d have so much quiet block time.
Mike: Right. It’s funny I have a training program that I created a while back, and in order to get it done, I just kept trying. It was taking longer than I wanted to, and I found myself . . . I’d never . . . I’m not a morning person generally, because I like to stay up late, but I blocked . . . the way I got it done quickly is, I said, “I’m going to start getting up at 3 a.m., and from, like, 3:00 until 6:30 when my son gets up and start getting ready for school.” And that three, three and a half hours, I was able to complete probably more than what I would consider a full day’s work every day, just by not checking email or social media, nobody around, it was just dead-quiet. I’m thinking to myself, “What the heck am I doing right now? It’s so early.” But I could just knock stuff out. So that’s a real thing.
Ted: So powerful. Now that I’m in California, I’m, like, behind the gun. If I wake up at 7:00, it’s 10 a.m., and, you know [inaudible 00:12:40], “Where have you been?”
Mike: Yeah. That’s funny. So, that’s cool. So the lifestyle thing is just a big part of why you do what you do. And, unlike people like me that invest primarily in the market that I live in, my customers know I’m here, my title companies . . . everybody knows I’m here, but for you . . . and you feel some obligation, like, “Hey, can you meet for lunch? Can you stop by . . . ?” You don’t have to deal with any of that stuff because you’re not where you invest at.
Ted: Exactly. No one knows where I am . . . well, except now, I just, kind of . . . but my business is based in . . . you know, my business address is in Florida, and I always have to explain, “So you’re selling a house in Alabama with a business address in Florida, but you’re in California?” [Inaudible 00:13:25] people.
Mike: I guess even when you were in Germany, you didn’t tell anybody you were there? I mean, they didn’t really need to know where you were, but . . . ?
Mike: Yeah. That’s awesome. So let’s talk about the . . . we’re going to get into the auction model here in a second, but the fact that you’re buying at auction, you’re not currently spending money on advertising, and you really haven’t for all these years, and it’s been just primarily you running this business. So you’ve bought 650 houses pretty much by yourself, and so you effectively have little-to-no overhead, right?
Ted: Right. No. I mean, I work at home. I have a nice beautiful office in my garage, which I actually just, last summer, kind of, renovated to look like in the same style that we renovate our houses. So that was kind of cool, but no overhead, other than my cell phone.
Mike: Well, let’s talk about, like, where you buy. Let’s talk a little bit more about buying at the auction, and what your model is now.
Ted: Sure. So I buy primarily at auctions. My favorite one is xome.com, and I buy some on the MLS, although that’s getting more and more rare. So I focus on three big markets for doing rehabs, which would be New Jersey, Baltimore, and basically all of Maryland, and then Central Florida: Volusia County, Daytona Beach, DeLand, Ormond Beach.
So those are the areas where I rehab, and, kind of, do more expensive products, but then for everything else, I’ll buy anywhere. I do wholesaling, or I just buy on the auction, and if the numbers make sense, and if it’s a cheap property, it doesn’t matter where it is. I mean most of . . . actually, all of my properties have been east of the Mississippi. That’s where they’ve fallen. I think that’s where you can get, kind of, the more distressed and lower-priced properties. My sweet spot on wholesaling is buying under 20,000 bucks.
Mike: Under $20,000, yeah. Okay. And so, and some of that stuff . . . and why is that? I mean, is it because some people ignore that stuff because they don’t feel like it’s a big-enough deal for them to worry about, or why is the cheap stuff . . . why do you focus there?
Ted: Well, I think one big reason is it’s just my comfort zone. If I’m going to buy something, sight unseen, and not do anything to it . . . like, I know if I’m buying a property for 10,000 bucks, the most I can ever lose is $10,000. That’s very unlikely that I would lose that. There’s not a lot of competition for those properties, and if you buy a property for 10,000 bucks, it’s pretty easy to turn around and sell it for $15,000 or $16,000. You’re not going to get a huge margin on each one, but you can do it, you can scale it, you don’t have to tie up a lot of capital, there’s really no risk, and it’s easy.
Mike: And it’s a volume place. So you’re like, “Hey, I don’t make as much on each deal, but I can do a lot of them,” without any advertising cost, without acquisitions manager, or some that you have to pay a commission to, all from the comfort of your laptop or wherever you’re at, right?
Ted: Right. And, I mean, doing it at that price point, I’m not stressing out as, like, “Oh, my gosh, I’m running out of money. How am I going to close on my properties?” You know, I could have a huge portfolio of $10,000 properties, and if a few of them took longer to sell, it wouldn’t stress . . . I mean, it would stress me out, but it wouldn’t, like, stress me out that I’m just . . . I don’t . . .
Mike: You don’t have, like, a $300,000, $400,000, or $500,000 house that’s just not moving, and now you’re looking at going below what you paid for it just to get rid of it, yeah.
Ted: I actually do have one.
Ted: [Inaudible 00:17:28] in Maryland. That’s fine, but . . . it’ll be fine.
Mike: So talk about . . . I think, most people, when they hear the auction, they would assume that it’s harder to buy at the auction now. And I’m talking, I guess, mainly about the county auctions, or sheriff sales, things like that. So I know a lot of folks have done that in the past and then it got harder to buy there, or they believe people overpay for houses, or whatever. I know the online auctions are a little bit different, but just talk about, kind of, where the auctions have been, and compared to where they are now, and maybe even compare to where you think they’re going.
Ted: Sure. So, I mean, I haven’t really bought much at tax auction. I’ve bought probably four or five at the tax auction, really cheap properties, not a lot of success there. When I bought this property, it was actually in Florida, and it was a condo hotel. It was an abandoned condo hotel, and I didn’t even realize what I was buying. My local agent said, “Don’t buy this one,” and I didn’t even pay attention to her email. So I got it, and I put that one up on eBay. I think I bought it for $4,000 and sold it for $8,000 on eBay. And then a few weeks later, I had it under contract, and the guy who lost it at the tax sale said, “Oh, darn it, I didn’t even realize I lost it at the tax sale. I’ll pay you, like, $20 grand for this property.”
So I put him in touch with the guy I sold to, and he had a nice wholesale deal on that.
Mike: Wow. Wow.
Ted: So that’s been my experience at tax auction. So I started buying on Xome, which was formerly HomeSearch in about 2014, kind of as a necessity. Up until then, I was just an MLS guy, and it was working really well, but the deals straight on the MLS were fewer and far between, and I started seeing a lot of these properties said “Auction only, HomeSearch, Xome.” And at first it was kind of irritating, like, “Well, why do I want to go on this auction and deal with that? It’s so hard.” And then I started buying a few, and I’m like, “Man, I’m getting some killer deals.”
And so I started buying a . . . you know, back then, like, my big market was Florida, and so I started buying all these condos on Xome down in Florida. And, sometimes I would just, like, go in and clean it up, and put it back on the MLS, and I was making great margins on it. So, “Man, this is easy.” And then, at the end of 2016, I started buying properties, kind of, in my traditional markets, the Ohio areas, buying really cheap properties, and I was selling some of those on eBay, and I was like, “You know, I could put these straight on the MLS, too, and it’d be a lot easier.”
So I was just buying property and putting them on the MLS, and it was working out really good, and I just kept scaling and going from there. And then I started looking . . . you know, condos were my sweet spot, so I started looking at all the condos, and I bought this condo in Maryland. And just through luck I was looking for a real estate agent out there, and I called this lady and she said, “Oh, my gosh, I can help you. I’ve been on HGTV.” And so I met an agent in Baltimore, and she is just golden. So she’s helped me there, and now we’re doing some pretty big flips together, big rehabs in Maryland. Then I started looking, I found a place in New Jersey to rehab, found a great agent there. So I’ve just kind of grown with the auctions.
Mike: So you have a few markets where you say, “When I buy houses there, I’m going to rehab them?” And that’s because you have . . . I guess, because you have relationships, you have boots on the ground, people that . . . and then they’re not the cheapo houses where you’re not going to rehab $20,000 houses. And then you have, “Hey, I’ll go anywhere else for the cheap houses because I think I can make a market there.”
Truthfully, probably the typical person . . . I would say, my guess is you’re probably primarily selling to not-established investors for the most part. You’re selling to the people that want to be an investor, or they want a “Fixer Upper” in their neighborhood, or something like that, that don’t take the time when they see, “Hey, I’d like to buy that house,” but then they see it’s going to the auction, they don’t quite get it. But then when they see it’s available on the MLS, and they can buy it, kind of, the traditional route, then they can play. Is that, kind of, what’s going on?
Ted: Yeah. I mean, I had one . . . exactly, right. I had one in Ohio that I bought, and a guy who lived across the street wanted to buy it. For whatever reason, he missed out, or wasn’t the high bidder at the auction, so I won it, and we sold it to him for probably $7 grand or $8 grand more than I paid for it. He knew it, and he was just fine with it.
Mike: That’s awesome. Yeah. I think there’s a lot of people that want to be investors that want to be close to home, or they drive past a house and, “Oh, I’d love to buy that house and fix it up,” then they see it’s at auction, they don’t really know what that means. Like, they don’t know, “I have to . . . ” Probably on Xome or probably every site, you have to set up an account, you have to get verified, probably, you have to become like a . . .
Ted: Credit card with $2,500 [SP] deposit. And, honestly, that was me three years ago. I was like, “I don’t want to hassle with this auction. I just want to [inaudible 00:22:35] easy on the MLS.” And I’m glad that I did because it’s just . . . it’s easy, really. I would encourage anyone who’s currently an investor, or who wants to be an investor to go check out Xome, and just try to get one deal. I mean be smart about it, but just go out and buy one because it’s easy.
Mike: Yeah. And this might be hard for you to . . . there’s a lot of people that are scared to even start investing, even in their backyard, and then, kind of, say, “Now you’re going to do this five states away from where you live, or on the other side of the country,” and a lot of people are . . . I found when you do things a lot, like, you have hundreds of times, hundreds of deals, you’re not scared of anything anymore. You think, “Well, this is . . . I mean, I just have to make a decision and go with it, and if I have a problem, I’m going to overcome it, and just is what it is.”
So, it takes a lot of experience to get there. For the folks that you just said, “Hey, go try it,” help them overcome their fears. Help them overcome, like, buying in a distant land, maybe a state they’ve never even been to physically before, just to say . . . kind of like what you said, “If you’re buying cheap houses, what’s the worst that could happen?”
Ted: Well, I mean imagine you’re in California, like me, and you want to start out. So you go on Xome, and you find this house in Canton, Ohio, actually a duplex, and you can get it for 6,000 bucks. I mean that’s the price of a 15-year-old SUV, 6,000 bucks. If you can buy a house for the price of a crummy, used car, what’s your downside? So go put it under contract, and then talk to a local agent, make sure that the resale value is there, and then list it with them.
You know, this is a real-life example. I bought this duplex in Dayton for . . . not Dayton, Canton for $6 grand. It’s under contract now for $14,000 to a local real estate investor, a real estate agent, super easy, no [risk 00:24:41].
Mike: One thing I’ll say with what you just said there, just to, kind of, give people some comfort, is that usually when these houses are on the auction, they’re also listed on the MLS. So you could find either the listing agent or an agent there that can go check it out. If you say, “Hey, if I buy this, I want you to list it for me,” and, for the right agent, they’re willing to say, “Sounds good to me. I’ll do some legwork for you. Let me go run and check it out, see if I see anything wrong with it, tell you what I think the market value is.” They’re willing to do that work for you to give you some . . . a little bit of boots on the ground to make you feel a little more comfortable.
Ted: Mike, it’s even easier than that. I mean, all of these Xome properties are listed on the MLS with an agent. So you just pick up the phone, call the listing agent, you’re lucky if they pick up because I don’t know what it is, real estate agents don’t like picking up the phone. But if you get them on the phone and they’ll talk to you, and you say “What’s this property worth as is? You know, if I bought it and I gave it back to you to put on the MLS, what do you think we could get for it?” And if they tell you, “Yeah $15,000 to 20,000 bucks, and you can get it for $6,000 or $7,000,” then it’s a no-brainer.
Mike: Those houses, when they’re listed . . . like, let’s say a house like that that you bought for $6,000, what is it typically listed for on the MLS? So it’s going to have to have an asking price, even though the asking price may not matter based on what happens at the auction. But what would something like that be listed for on the auction, or what’s typical?
Ted: Yeah. I think this one was probably listed for either $25,000 or $29,000. It was pretty high.
Mike: And you got it for $6,000?
Ted: They, kind of, set unrealistic asking prices on the MLS, but . . . you know. And it’s funny with Xome, sometimes they’ll take, like, really lowball bids, and other times they come back to you and asking for stuff which is just unreasonable, and there’s not a lot of rhyme or reason to it. You just, kind of, have to go after a lot of stuff. So, if you’re just getting started, though, I would identify a bunch that look good, and then call the agents and, kind of, do your due diligence upfront.
For me, I, kind of, do my due diligence after I bid because I’ve been doing a lot, and I buy a lot from Xome, and I usually have a pretty good sense of what’s going to work, anyway. But if you’re just getting started, make the calls. But don’t go in thinking that you’re going to buy a $6,000 property out of state, rehab it for $20 grand, and sell it for $100,000, because if you go in with that mentality, you will lose your shirt. You know, in terms of that, like, with these low-end properties, trying to rehab them, it’s, you got to be there, you got to know what you’re doing, or you got to have, like, a really good property manager.
You know, I’ve sold to a lot of people who have done very well. There’s a lot of people who I’ve sold to and they’ve hooked up with a good property manager who’s gotten a reasonable rehab, and gotten a tenant in there, and then they come back and bought a lot more properties. But you really need a good trusted contact, so I wouldn’t recommend starting that way.
Mike: Yeah. We’ll probably have you back some time to talk about, kind of, virtual rehabbing because that could be a whole show, in and of itself. Managing a rehab in your back yard is hard enough, let alone on the other side of the country, but I know you’ve cracked the code on it, and you do pretty well with that.
So, yeah, what you’re kind of saying is, don’t advise people . . . if you’ve never bought at the auction before, don’t plan to rehab from multiple states away, because that’s maybe a nightmare waiting to happen if you haven’t done it before.
Ted: I think so. And, more importantly, don’t plan to rehab a really cheap house, because they’re cheap for a reason. And just because it’s cheap doesn’t mean that you can’t buy . . . you know, my motto has always been, “Buy cheap, sell cheap.” So buy so cheap that you can turn around and sell it cheap that somebody . . .
Mike: Just not as cheap as you bought it for?
Ted: Exactly, usually.
Mike: So let’s talk about, real, real fast, there’s obviously a lot of auction sites out there, Auction.com, a whole bunch of sites, and you’re primarily using Xome right now. Maybe at a high level, what are the differences that you’ve seen with different platforms over time?
Ted: Sure. So, I buy mostly on Xome. I bought two properties at Auction.com. The issue I have with Auction.com is they don’t give you as much info upfront, they don’t really put a lot of pictures up on there. And then, after you win the bid, they’re sending you these automated emails saying, like, “You need to sign this contract and send earnest money within three hours.” So they’re putting a lot of pressure on you as a buyer. And then you send everything in, and then they don’t tell you for 30 days if the seller’s accepted it, and good luck trying to get them to respond to you or even care about you.
Mike: So they’re primarily selling, I think, trust . . . acting as a trustee, or through trustees, I think, foreclosure-type auctions. Are the properties that are on Xome, for example, are they coming from a different source?
Ted: So, Auction.com . . . I only buy REOs. I’ve never bought a trustee sale. So Xome and Auction.com both have REOs and trustee sales, so the ones I was referring to with Auction.com, they’re also REOs. But, I mean, just from a level of treating the buyer well, and treating the buyer with respect, and how you would want to be treated, it’s a very frustrating process. Not to say that you couldn’t make money there . . . I mean, you probably can, but for me it’s the 80/20 rule. If I’m going to try to have, kind of, a cushy lifestyle, and do this when it works for me, I want something that’s easy, that’s not going to frustrate me, that I’m not going to have to be constantly following up to see if I’ve got the contract.
And so, Xome I know a lot of the asset managers there. When you win a bid you complete a checkout form which you enter in all your information, your real estate agent’s information, and they usually tell you within a . . . you know, sometimes instantaneously, but usually within a day or two if you’ve won the auction. And then they don’t require earnest money until you’ve got a signed contract, whereas Auction.com, they want you to put up $3 grand earnest money, and you don’t even know if you have a deal.
And I’ve won one property on Hubzu, but that was such a nightmare. They outsource all their customer service to India, and I literally spent time . . . I was trying to get in touch with the local real estate agent, and I spent time arguing with this guy over in a call center in India, giving me, like, an eight-digit phone number, and I’m like, “No. Phone numbers are 10 digits.” He’s like, “No, sir. This is the phone number.” So Hubzu is just notorious for being very difficult to work with.
I mean, that said, you could . . . you know, I’m sure there’s some good deals on there, but also the way they run their auctions, I noticed the Hubzu auctions, they’ll come up, like, 10 times before they’ll finally sell. And so I don’t know what kind of algorithm or what kind of formula they’re running to determine their price, but I know it would probably drive me nuts if I had to bid on a property 10 times, or on 10 different [inaudible 00:31:49] before I got it. And so, Xome doesn’t . . . you know, Xome is just easy to work with.
Mike: Yeah, okay. So, Ted, we’ve got just a couple minutes left here. So maybe give your best . . . why don’t you give a pitch to people that are listening right now as to why they should . . . let’s just say there’s two people that are listening. Hopefully, we have a lot more than two people listening to the show right now, but let’s just kind of put two main groups of people, either those that want to be real state investors, they haven’t done anything yet, they don’t know how to get started, and this sounds interesting, like, “I’ll buy in an auction instead of some of the traditional ways, maybe, like that I buy, which is doing it in my own market, spending money on advertising to generate leads.”
And then somebody that is doing some investing now but not enough volume, not as much as they want, and they want to grow, and they’re listening to this, say, “Hey, that might be how I move forward with some of my business.” Maybe, kind of, talk to those new or newer-type people as to why this makes sense.
Ted: Okay. So here’s my elevator pitch, if you will. If you’re a new real estate investor, and you don’t know quite how to get started, if you don’t have a marketing machine built up for acquiring property directly from sellers, then you can go on Xome right now, you can look at 4000 or 5000 properties across the country, you can see what’s available, do your due diligence, and start placing bids, and you could have an auction property under contract by the end of today. It’s an easy way to jump in the game. And there’s a lot of properties under $20,000, and even under $10,000. So you can jump in today with little-to-no risk and be on your way to a successful real estate investing career.
Mike: Yeah. That’s awesome. Awesome, Ted. Hey, thanks for sharing your information today, and your story.
Ted: It’s fun. Thanks for having me.
Mike: If folks wanted to learn more about you, about what you’ve got going on or . . . where could they go to learn more?
Ted: So I’m on Facebook. I have a direct-to-seller, kind of motivated-seller site, fairhousedeals.com. So, you can email me at [email protected], and I’m usually pretty quick to respond. Would love to chat with anyone over the phone. You know, if you want to call me, just send me an email, get in touch, and set up a time.
Ted: I’m pretty available. So, if you email me and I don’t respond within the hour, send . . . call the FBI because [inaudible 00:34:24].
Mike: Awesome, man. Hey, thanks for sharing. This is good stuff. Hopefully, I think some folks listening today . . . hey, people are always looking for different angles or different ways to do things, and you definitely are . . . you know, you’re doing it differently than a lot of folks we’ve talked to on the show before. And it’s pretty intriguing, so I think people are going to find a lot of interest in that.
Ted: Absolutely. Well, good luck to everyone out there. And if you want to bounce ideas off me, or just chat more about the auctions, would love to.
Mike: Yeah. Awesome. Well, buddy, I’ll see you next month at Investor Fuel.
Ted: See you in May at Investor Fuel, man. Good times there. What a great group?
Mike: Yeah. We’re glad you’re part of it. Yeah. Awesome.
Everybody, hey, thanks for joining us. This is episode number 200 . . . oh, I’m sorry, 410 with Ted Snyder. Interesting model here. It’s pretty cool. I’m going to check it out a little bit more myself. Ted and I have been talking about it. But if you enjoyed today’s show, if you would, please, subscribe to us on iTunes if you haven’t yet. After 410 episodes, your subscriptions and positive ratings on iTunes, Stitcher Radio, Google Play, YouTube, anywhere where you can get our show . . . and, of course, you can watch it and listen to it on FlipNerd.com, as well, is kind of the fuel that, kind of, keeps us going here. So we’re going to keep great guests coming at you here, providing great information. Give us some positive ratings, we’d love it.
So, everybody have a great day. We’ll see you again soon. Take care.
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