Today’s REI Classroom Lesson
Today, Holly McKhann talks about networking groups in your city and how they can help you grow your real estate investing business.
REI Classroom Summary
By talking with other group members, you can let them know that they’ll get a referral fee by helping send the right people your way. Making it about them and less about you is critical.
Listen to this REI Classroom Lesson
Real Estate Investing Classroom Show Transcripts:
Mike: Welcome back to the FlipNerd.com REI Classroom where experts from across the real estate investing industry teach you quick lessons to take your business to the next level. And now, let’s meet today’s expert host.
Holly: Hi there. I’m Holly McKhann for your REI classroom coach today and I am so excited to share with you my specialty tips on networking.
Mike: This REI classroom real estate classroom lesson is sponsored by VirtualStaffNow.com
Holly: So a little quick background on me, my husband and I have flipped over 200 homes in Southern California in the last six years. And why this topic of networking is important to me, is, after our first 100 homes that we bought at auction on the courthouse steps, that the deals were just there whenever we wanted. We had cash, we had a house. So easy. When these big head funds moved in and squeezed us little guys out, we had to find another way to find houses. And rather than jumping into spending thousands of dollars on marketing, which I know can be very profitable and a lot of people are successful at it, we took the easy way out for me and I just started opening my mouth and talking to people and finding deals in my community and through realtors.
So today, I want to share with you how networking groups have been successful for me. A networking group can be your chamber of commerce, it can be your realtor board. There’s a big group out there called BNI. I think it stands for Business Networking International. I don’t even know. I should know that. And I’ve visited some BNI groups. I’ve never joined one, but look them up online; you can Google them. But all these networking groups out there, there are lots of opportunities to meet other outgoing business owners and salespeople that are trying to increase their business.
When you’re at these networking groups that might meet weekly, monthly, occasionally, the idea is that you’re going to give other people referrals. Everybody wants to give everybody referrals and help them grow their business. They’re really fun. They’re a fun, social atmosphere, but you should definitely go with the goal and objective in mind to not only look for leads for yourself but also to help others. I’ve got a friend that through her BNI group, she has found contractors for her house flipping business, she’s found houses, she’s found realtors that have brought her houses, and she’s found private money investors. So it’s been extremely worth it for her and her BNI group. That’s what she did.
I want to share with you story with you today about a group that I went to just one time. It was a local, little group in Corona, California. I went because my friend John had invited me and there only eight people sitting around the table. It was a breakfast meeting and everyone is going around. There’s an insurance guy, there was a mortgage guy, all different types of industries of people. And I said to the group, “Well, I’m a house flipper. And while you may not know someone that’s got a run-down house they need to sell quickly, probably all of you know realtors. And I know all of you are in other networking groups,” because these were all frequent networkers, “and I know it’s hard for you to find referrals for realtors because you think that, “Oh, a realtor, we only move once every seven years on average and there’s just not a lot of referrals for realtors,” it’ tough.” I said, “So refer me to your realtor. If you get me to a realtor that I can buy a house through, I will give you $250.”
One of the guys there, Joel, a very outgoing, driven, motivated, social young man, probably about 27 years old, he had eight realtors call me within 24 hours. I couldn’t believe it. It was fantastic. My phone’s never rang so much. So they called and learned about my parameters and what I was looking for. I gave them my quick little spiel of, “Bring me a house. I’ll buy it with you and I’ll resell it with you. I’m loyal, I want to do lots of deals with you, I’m an easy client, just find me those ugly, nasty houses that you’re afraid to show any of your what I call ‘retail clients’.”
And one of the ladies, she found me a house. Not only did she find me one house, she found me two houses. It was fantastic and they were both really profitable. So Joel led me to Karen. I bought two houses through Karen the realtor and she was great to work with. Usually, people that know your friends and your sphere of influence have similar mindsets and so they’re really great quality people like you are and the people that you are working with. So I gave Joel $250 times two. He got $500 bucks and he was excited. That was a lot of money to him. He was a struggling young guy.
And that worked so maybe you need to offer more than $250. Maybe it’s less. It depends on your area and what people need and want. But I made it all about the group like, “If you can find me someone that I can buy houses with, I will pay you.” I didn’t make it about me going about me, going, “I need a house. It’s me, me, me. Give me a house.” I said, “I want to pay you guys referral fees so if you can have realtors call me and if I buy houses, I’m going to pay you.” It works really well.
So you can use that not only in networking groups, you can use that with friends and family too. But remember, make it about them. What’s in it for them? Not about you going, “Oh, I need a house. I don’t have any deals.” Just say, “Oh, I’d love to pay you a referral fee. Who do you know?” and get that brain spinning of theirs. So that’s it for my tips on networking in official networking groups and I look forward to seeing you next time. Thank you.
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