How to Double Your Wholesale Profits

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 424. My guest today is Adrien Chabot. Adrien is a Northwest Indiana real estate investor just around the bend from Chicago. He’s been a fulltime real estate for only about two years and with his partner, they’re on track to do about 100 deals this year. Pretty amazing.
Like many of us in this market cycle, Adrien started to feel his margins getting pinched because of higher marketing costs and sometimes having to pay more for deals to beat out the competition. He could’ve just accepted lower margins but he’s come with a number of techniques to sell his properties for more which has actually allowed him to nearly double his deal profits. Today’s he’s going to share those tips with you. Get your pen ready because there’s some powerful tips and advice shared during this episode. Please help me welcome Adrien to the show.
Hey, Adrien. Welcome to the show.
Adrien:Hey, thanks for having me.
Mike:Yeah. Excited to talk about some these things that we said we’re going to talk about. For folks that listen to our show, they probably, if you listen to the show religiously you gather that we have a little pre-meeting here to talk about what we’re going to talk about and jump a little bit. So I’m excited to talk about how to squeeze more profits out of this market because what’s happening to some folks, their marketing costs are going up, they might have to pay a little bit more than they used to for houses, and so the question is, “Well, how do you not decrease your margins? Like how can you make up for it?” This is a very timely discussion because a lot of people are feeling that pinch.
Adrien:I definitely felt that pinch and the changes have definitely been worthwhile.
Mike:Yeah, yeah. Awesome. Well, hey, before we get started with talking about what we’re going to talk about here today, tell us about yourself. Tell us about your background.
Adrien:So I’m originally from, Maine. I live in Indiana now just south of Chicago, in the northwest quadrant. And I came to Indiana back in the late-’90s for college. My background is in biology, and I got my undergrad and masters in biology. My first position I managed a genetics lab up at the University of Chicago. So I was a lab geek. I got to play with Petri dishes and do some really cool stuff.
I left that back in 2008 because it wasn’t good money. I got into sales. I did insurance sales. Door-to-door straight commission. So that was pretty fun. Great company. I loved what I did. I learned a lot. Did that for about eight years, but in the back of my mind, I always wanted to be an investor. My uncle back in Maine had a bunch of small multi-family properties. I saw the passive income he was getting every month.
Like a lot of people I read “Rich Dad Poor Dad,” other books. I used to call myself a fantasy investor and what I mean by that is read a bunch about it. I went on Zillow all the time and looked at properties. I’m like, “Man, if I bought this property, here’s what the mortgage would be. I’m going to get $300 a month on top of the mortgage in passive income.” I did all this stuff, but I never had money to buy anything.
Mike:You just did it on paper?
Adrien:On paper and in my head.
Mike:We can create like a real estate investing, like a fantasy league.
Adrien:Fantasy league. It was dreaming. It was good because it moved me towards where I wanted to be. Passion was there. And then one of my insurance clients was a big time wholesaler in this area and he had introduced me to wholesaling. So I did a ton of research on it on BiggerPockets and other websites, and initially I was turned off by it because if you go on any of those sites and you research wholesaling, you got people that hate it. People that love it.
And everything you read is true. There are good wholesalers. There’s bad wholesalers. So at first, I was turned off by it, but at the same time, I’m like that’s my intro into real estate without money. So as I’m doing my research, I’m like there’s got to be a way to do it ethically, morally, honestly, so I decided to build a company around that. In 2015, I just happened to be on Craigslist. I see a guy post a house for sell, called him up right away, met him the next day, put it under contract, sold it for a week later. I think I made like $7,500. And in November and December of 2015 I did three deals, all of them off Craigslist, and I made $20,000. I’m like this is pretty cool.
Mike:Yeah. Your day job was door knocking, door-to-door insurance sales, right?
Adrien:Started at 10 a.m. and I went till 8 p.m. every day. And I had three kids at the time that I wasn’t seeing a lot because I was also traveling once a week for that. So I told my wife in January of 2016 that I was going full-time with this wholesaling thing.
Mike:Yeah, that’s awesome.
Adrien:I bought a small absentee list of 250 people and we literally handwrote all of those yellow letters and sent them out. And then I found a couple of local people that I met off of BiggerPockets that I taught how to birddog and that was a benefit of doing the direct sales is I knew what vacant houses were like. So I taught them how to look for, you know, the overgrown landscaping, the little mini trees growing out of gutters, you, know, bad roots, and over a two-month period we put together a list of about 700 houses that I continued to mail.
So I worked my butt off. Those first three or four months it was a grind, but I was making money. And towards the latter half of 2016 I came across two or three properties that couldn’t wholesale the traditional way. I had to close on them either because they’re occupied or the owner wouldn’t give me access. [inaudible 00:06:07] local that lended on those and closed on them and we split the profit. Of those three houses we split a total of $110,000.
And that person that lent is now my business partner. We got together in October 2016. And one of the very first things we did is we joined a mastermind, which at the time was phenomenal because there were so many things that we didn’t know that we didn’t know. So we didn’t know about CallRail. We didn’t know about CRM. We didn’t know about all sorts of different systems that made everything really efficient.
Mike:Right, right.
Adrien:It was the best 15,000 we had spent at the time. 2017 we did 78 properties. We’re putting in systems now to hire more people, ramp everything up, and eventually not work as much in the business, but focus more on working on the business. Long-term goals is obviously like most investors is to continue to build up a passive income. I’m not so much interested in a bunch of single-family homes. I’m looking for more of the multi-family homes.
Mike:Okay.
Adrien:Is kind what we’re focusing on right now.
Mike:Yeah. Awesome, awesome. So for a couple of years you guys are on track to do over a hundred this year. Is that right?
Adrien:That’s a goal this year.
Mike:Yeah. That’s awesome.
Adrien:A little bit behind schedule for that, but it’s a tough market. Profits are way up but the house count is a little bit down but we’ll hit it.
Mike:Yeah, yeah. That’s great. Yeah. And of course you guys are part of my mastermind group now, the Investor Fuel group. We just had our last meeting and it was awesome to get to know you guys better there.
Adrien:Yeah. It’s good to be in a group where there’s a bunch of other people crushing it as well.
Mike:Yeah, yeah. Awesome, awesome. That’s great, man. I think one of the messages I want to get across for the folks here listening right now is you’d been dabbling with it a few years, but you guys really got serious last year. So in the past like two years, two and a half years or so you’ve gone from, as you’ve said, kind of playing in the fantasy league to really what most people consider the big leagues now, right, based on your volume. So hopefully that encourages people listening out there that they’re coming in, in a more challenging market than we’ve seen . . . I’ve been an investor for little over 10 years now, so more challenging market because of where we are in the market cycle, right?
Adrien:Right.
Mike:And you guys are still able to come in and crush it. I’m always inspired by people . . . a lot of veteran investors are whining. They kind of whine in the market, like, “Oh, it’s not as easy as it used to be.” And people come in and they don’t have . . . I was once in that position. I didn’t have any bad habits. I didn’t know how it should’ve been or how it used to be and you kind of always have that first couple of years when you’re crushing it and you’re new out of the gate. It’s always inspiring I think to other people because a lot of people question whether it can be done or does it even work in this market and things like that. Any kind of feedback to those people that are just getting started, I guess, based on the lessons you’ve learned yourself?
Adrien:You know, when I was selling insurance I did a lot of recruiting and a lot of new agents come in and what I always taught them and this was taught to me in previous sales careers is it takes three things to be successful – work hard, study hard, and be coachable. So when I started, work hard, I mean, I was at my office 8 o’clock every day and I worked every single minute of the day. I mean, I didn’t waste time on Facebook. If I wasn’t talking to a seller, if I wasn’t networking with a buyer, then I was reading a book whether it was a leadership book, a real estate book, I was reading stuff online, BiggerPockets.
As a wholesaler you need to know everything. You need to know how people are making decisions when they are buying rentals, how they’re making decisions for flips. So I kept reading, reading, reading and learning more. I networked a ton. I educated myself. So just go out there, work hard, study hard, just be coachable and things will get better. You don’t have to be an expert overnight. It took me a good four, five, six months before I felt comfortable and confident talking to sellers. But I worked hard enough to find the low hanging fruit. ‘
Mike:Yeah, yeah. Man, that is the key to this business. Really it’s the key to being successful at anything is just focus and commitment. Right? I say this all the time because I coach and mentor a lot of people in real estate obviously. But a lot of people fail and they give up before they even do a single deal. They just give up because they realize that it harder work that HGTV and a lot of other people would lead you to believe and then when you get into then you realize, “This is harder that I thought, so let me just do something else.” Right?
Adrien:Man, I can remember the day pretty clearly. It was probably about 70, 75 days into when I consider having gone fulltime and I had made good money. I did up that point eight or nine deals. Those deals were probably averaging 3,000 to 4,000 a deal. Nothing to brag home about. They paid the bills but mentally it was a grind and I can remember sitting in my office kind of having a “come to Jesus” moment and wondering if I had made the right decision.
Mike:Yeah.
Adrien:I didn’t have a ton of deals in the pipeline, so the future wasn’t very positive. I’m like, man, I can back into insurance where . . . even though it was straight commission, I had the system down where I knew I was getting guaranteed money every month. It was fairly easy to go out and make sales. So in my head I’m like, “I can go back to that. It was easy. It’s not what I want. Or I can focus, get committed on what I’m going to do here, and you know, burn the bridges and not make it an option going back.” So that’s what I decided to do and literally like a week later I fell into my biggest sale at that time.
Mike:Yeah. That’s awesome. Stay committed. Awesome. So let’s jump into the topic for today. We’re talking about how to get your profits up on your deals, right? So if you got to pay a little more for them. If you find you’re spending more on marketing these days. There’s two alternatives. One is just absorb those expenses, right, and make less money. Or figure out a way to sell them for more.
And kind classically I think a lot of us as real estate investors we’ve always been taught how to kind of perform on the buy side and on the sell side we just kind of say if we buy it deep enough like the rest will take care of itself, right? It’s kind of always your philosophy too when you first started. And then when you start to realize like, “Hey, my margins are eroding here,” you start thinking about what could I do to sell them for more than I would in the past.
Adrien:Right. Yeah.
Mike:Let’s dive in. I know one of the things, you’ve done a couple of pretty cool things to get that . . . Let’s talk about the first one which is just kind of not taking that first offer necessarily.
Adrien:So and I started this a year later than I should but I can remember the first properties that we did in 2017 I sent it out to buyers at 35. One of the guys that looked who’s a really good buyer for me now, I didn’t know him at the time, he looked. He’s like, “I’ll get back in a day or two.” I didn’t hear from him. Someone else gave him the 35, so I closed with him. That guy was like, man, after doing all my research, I would’ve given you 45. I’m like, well you should’ve got back to me earlier.
And over the course of last year, that came up several times where like, “Man, if you had given my more time or I would’ve paid more.” I hesitate to change things. My partner had been like man, we’ve got to figure out a way to do this a different way. So what we started to do instead of putting it out at say 70,000 and taking the first offer. Because what started happening at the end of last year is buyers that used to beat me down on price were putting offers in sight unseen at full price within 10 minutes of me sending it out. I’m like, “Man, if they’re willing to pay that now, I know I’m leaving money on the plate.”
So what we decided to do and we started this year is I’d send out a property let’s say on a Tuesday at 10 o’clock. I’d send it out on a Tuesday morning at 10 o’clock at say $70,000. I would give everybody at least 48 hours to go look at the property now. So some came to look at the property Tuesday at 11 o’clock, put in an offer at 70, but they know because I’ve trained them that I’m not going to review offers until the deadline, which is at least 48 hours later. That lets many people go look at the property. It gives agents, I have a bunch of agents, it gives them time to contact their investors, go look at the property and everybody has to have offers in by . . . You know, if I send it out Tuesday morning, offers need to be in by Thursday at 3.
What this does is there’s sending highest and best. So if I send it at 70, I’m getting offers at 75, 80, 85 because part of it fear of missing out. Some of the investors have put in low ball offers on properties that they really wanted from me. They didn’t get it because someone put in a higher offer, so now they’re putting in an offer. It still makes sense for them whether they’re going to make money, but it’s higher than the number that I put it out there at.
Mike:Yeah, that’s awesome. It’s like an auction but you’re not bidding back and forth. It’s like guess kind of what they refer to like an blind auction, right?
Adrien:[inaudible 00:15:16] Mike:Just give me your best price and we’ll see if you’re the best, and if you’re not, we’re not going to give you a chance to come up. Like you’ve got one opportunity, put your best foot forward.
Adrien:People ask me that all the time. “Hey, if I’m not the highest offer, can you contact me and give me an opportunity to increase my offer?” I’m like, “No.” Because on our average property, we’re getting 8, 10, 12 offers. [inaudible 00:15:36] auctioneer going to go back and forth and try to bid them up. If you’re the highest and best, if you’re the highest offer, then you can have it. And it’s made a huge difference in our profits this year.
Mike:That’s great. And you’re right. This is a market where you can do that. Right? What you said exactly, the fear of missing out.
Adrien:It’s annoyed some of my good buyers that were used to doing it a certain way. As humans we don’t like change. We fight it. So when they’re used to getting a property, being able to put an offer in at full asking without seeing it, and now they have to actually go look at it and evaluate their numbers, they’re not happy. But I understand that right now houses are at a premium. There’s not a lot of inventory for houses that make good flips or good rentals. And I have those houses. We’re paying a lot more for the houses. Our marketing budget has probably doubled this year. Our pay per click used to be $60 a click. We’re at $200 a click.
Mike:Right, yeah.
Adrien:I just got a loan.
Mike:Yep. And the thing is you’re not forcing anybody to pay the price. You’re just instilling that fear that they might miss out unless they put their best foot forward, and so they don’t have to bid. They don’t have to put in an offer.
Adrien:In the market that we’re in low ball offers whether it’s on the MLS or through the wholesaler, it just doesn’t work right now because there’s so many people willing to pay more. And that’s what we’re looking for is that person that will pay more.
Mike:Yep, yep.
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Adrien: . . . $200 a click.
Mike:Right, yeah.
Adrien:I just got a loan.
Mike:Yep. And the thing is you’re not forcing anybody to pay a price. You’re just instilling that fear that they might miss out unless they put their best foot forward and so, they don’t have to bid. They don’t have to an offer.
Adrien:In the market that we’re in low ball offers whether the MLS or through the wholesaler, it just doesn’t work right now because there’s so many people willing to pay more. And that’s what we’re looking for is that person that will pay more.
Mike:Yep, yep. So talk a little about. I know you guys have a fairly active meetup group, club and I know that that’s helped you build your buyer’s list and kind of build your reputation. So talk about that impact on your business and maybe how that can help other people too.
Adrien:Yeah. So I started that club back . . . and we’re like a REIA but we’re not part of the national organization. I started that back last year in January and the reason I started that was twofold. One, I like teaching. I like educating. I like mentoring people. So it gave me a platform to do that every month. And secondly, it’s obviously it’s branding and puts us in front so investors.
So our first meeting that we did January 2017 we had 15 people there and as we’re doing this meeting, I’m like, “Man, was this a good idea?” Because it takes a ton of time, a ton of energy to put it all together. But we average 85 a meeting. We do it once a month just like any group. It’s just been a great way to meet new buyers, build our brand. The speakers that we bring in are phenomenal. It’s a meeting where all the speakers that are coming in, they’re not selling their junk. They’re teaching about a specific real estate topic. We do a ton of networking. It’s just been a great event to be able to give back, teach, and mentor.
Mike:And in those events do you . . . I know in some groups that bring deals to the group. The problem I always have with that . . . Do you do that or . . .
Adrien:We have an opportunity at the end of the meeting for anybody to present any deal that have. I don’t do a ton of presenting there because I don’t want it seem like the group is all about me.
Mike:Right.
Adrien:It’s the same brand that we have. I didn’t mention this but we have a brand for buying houses from people and then we have a brand for selling houses to people. Two separate websites. Two separate Facebook groups. So on the sell side that’s the same brand that we do the monthly group through. They’re seeing my emails for properties. They’re seeing the properties on the same website that has the same group information, so that’s how we’re putting it out in front of people.
Mike:Yeah, yeah. Because there’s some group that say, “Well, we’ll bring our deals to the group.” And I’m like what if you get a deal like the day after a meeting? You’re not going hang on to it for a month until your next meeting. So . . .
Adrien:Exactly. Yeah.
Mike:So the buy and sell side of this business needs to be like 24/7 kind of fluid. Not like let me hold on to it until we have a meeting.
Adrien:The biggest things with the group. There’s a group in this area that is part of the national group. A lot of the speakers they bring in, you know, they give you a really good topic, but then they’re selling it. To get the meat and potatoes, you have to buy the program. It was frustrating so I wanted a group that had really good speakers. Most of the speakers are local people that are doing stuff currently. They’re active investors. They’re active attorneys or active property managers. The last guy that spoke he’s on pace to do 50 flips this year and he talked about how he increases the value on his property so he can get top dollar for them.
Mike:That’s awesome.
Adrien:[inaudible 00:21:37] Mike:What’s the name of your club, your group?
Adrien:Invest NWI.
Mike:For Northwest Indiana, I assume. Yeah. Awesome. So we’ll add a link.
Adrien:[inaudible 00:21:52] buyers, that’s the buy side. And region if you’re familiar with the Bears, “The Region,” Mike Ditka.
Mike:Yeah.
Adrien:That’s how we named that because the nickname of this area is “The Region.” That’s Region Home Buyers and then on the sell side it’s Invest NWI. So that’s how we do wholesale deals. That’s all of our mentoring and the monthly program is all through Invest NWI.
Mike:Awesome, awesome. I know another thing you’ve done that we were talking about is a lot of people just say, “I’m going to build my list,” and we just kind of . . . we have this nameless, faceless list this big email list you’re kind of blasting them to and there’s nothing wrong with that, but sometimes it’s hard to build relationships with people. You just don’t know who they are and what they’re even looking for.
And so I know you’ve made some efforts to actually kind of get to know your buyers a little better, what they’re looking for. And honestly, sometimes that helps you do a deal you wouldn’t do otherwise because you’re like, I couldn’t pay that much for it but I know somebody that really wants this area and if they’re willing to pay a little bit more, maybe I can make this happen. Talk about that kind of relationship building side with your buyer’s list.
Adrien:Yeah. So a lot of times people think this is just a numbers business. I got to go buy a house at 70% minus ARV minus my wholesale fee and I’ll email that out to all of these people that have signed up and people will just come and buy.
Keep in mind, there’s a huge obstacle that you have to overcome is that most wholesalers are distrusted and they’re not looked at as professionals. Honestly I get emails from other wholesalers, the deals aren’t deals. So to overcome that I understand this is a people business. People do business with people that they like and trust. Well, how do they like and trust you if they don’t know you?
So the reason I gained 25 pounds as I started wholesaling is I meet investors all the time, Dunkin’ Donuts, Starbucks, wherever. And a nice Boston cream donut goes a long way. But building that relationship with me, they see me. I see them. You’re building that trust.
I just had a guy that I met when I got started in 2015. He hates wholesalers. He’s one of my better buyers now because he likes me. He trusts me. He knows that the deals I send out are good deals that he’s going to make money on. But it took a long time with building that relationship with him.
Another big thing too is this almost like a reverse wholesaling thing that we can do is going back a year ago, two years ago, it was very easy to get a house under contract using the traditional formulas. But now the market being as tight as it is in some of the communities I’m buying in, you’re not buying a house at 70% minus ARV minus your wholesale. You just can’t get the houses that low anymore. So by spending the time networking with the buyers, understanding how they’re making their buying decisions, it allows me to go target houses that they’re going to buy at higher prices than I normally would’ve.
Mike:Right.
Adrien:For example, I just had a closing today. I was the agent for it. It was a house that I couldn’t buy to wholesale so I listed it so I could still monetize the lead. And it was in an area where I don’t do a lot of purchasing there. So I wasn’t quite sure what someone would spend on a house like this. So listing it doesn’t cost me any money. So the guy owned 45. I listed it at 55, and ended up selling it to one of my buyers.
And during the part time it was listed, I got a ton of feedback from other buyers that looked at it, so now I realized in this market in that community I can go buy houses just like that that are going to see for 50-55. So by knowing what my buyers are buying and what they’re willing to pay, I can now go find stuff for them and pay more than my formulas or my gut feeling is telling me I should pay.
Mike:Yeah. And buyers move so fast it’s something to be said for, you can get a house under contract. We’re honest with sellers like, “That’s a little more than we would normally pay for it, but if you kind of give me . . . ” effectively you don’t say it this way but, “Let me get it under contract and let me go market it a few days and see if I can make anything happen, and if I can’t then I’m just going to terminate our contract. We’ll be back where we are right now. Just give me a week and see what happens.”
So you don’t say it like that, right? But fundamentally that’s what you’re doing. Let me go see if I can make something happen and if not, then I’ll talk about plan B.
Adrien:Yep. And we close . . . when I started wholesaling one of the biggest things that you read about is wholesalers putting under contract and then they don’t close on it. They’re essentially lying to the seller about being the one who’s actually going to buy it. And I wanted to build a company on honesty and integrity, so when I got started my cash offer was so stupid low that if they took it, I knew I could find someone that would lend on it and close on it.
And if that didn’t work for me, and if that cash offer didn’t work for the seller, then I’d be like, “Look, I know other investors that whether they’re doing the work themselves or their exit strategy is different, they’re going to pay more. So why don’t we do this? We’ll put the house under contract at the number you want. That way we can start to title work, make sure that there are no issues. I’ll bring in the buyers. I’ll do all the legwork, I’ll show them the house, and then they’ll pay me on top of it. But you get what you want.”
And I did that and that’s how I got my first six, seven, eight deals done. They knew exactly what I was doing, so I felt good about it. And even now there are times where, because of their mortgage or the condition, my cash offer doesn’t make sense. So I’ll do the same thing. “Hey, let’s put it under contract at the price that works for you. I have a massive network of cash buyers I can show this to. You know, maybe one of them will give you their price, your price, plus a little bit on top for me to make it worth my time,” and at the end of the day as long as you’re solving that seller’s problem and helping them get from point A to point b, they don’t really care what you’re going to make on top of it.
Mike:Right. That’s exactly right. Yeah. I think the important thing is exactly as you said. Don’t ever mislead somebody. You don’t want to be that guy that is locking up contracts all over town that truthfully you paid so much that nobody is going to buy it from you. And telling the seller not letting them know that you might cancel the contract if you can’t find somebody. So we’ve had people who over the years for sure call us and say, “I have it under contract with somebody, but they’re not answering their phone and we don’t know where they’re at,” but basically they’re not performing right. And then we go and clean up those messes sometimes . . .
Adrien:[inaudible 00:28:34] Mike:Pardon my French, that was a shitty thing to do to a seller. Say that again.
Adrien:You probably got that house under contract for a lot less than that person did anyway.
Mike:Yeah. Yeah. Exactly. So I want to talk a little bit more about the building up relationships with buyers. It’s easy to say. I build relationships and kind of learn what they want, but is there a kind of tactical way, not to take anything away from being genuine but kind of a way to set aside time to get to know people? Because we all get so busy in our lives that it sounds nice that I want to be able to do that but I never get to it. Is there anything that you do that you can share with listeners as to how you dedicate time or take time to go build those relationships?
Adrien:Yeah. So I read a book and I do a lot of reading. My goal this year is to read 24 books. I don’t remember which book this was in but the idea was never eat alone. And I think that might’ve actually been a title.
Mike:Yeah, there’s a book, “Never Eat Alone.” Yeah.
Adrien:That’s it. Well, I’m eating. I’ll probably have a snack in the morning, coffee and donuts. I’m eating lunch. Sometimes I’m doing dinner. So I was very intentional about inviting people to lunch, dinner, whatever. I scheduled time in my calendar when I got started to meet with investors, so my goal was every week I want to meet, whether it was just coffee, soda, whatever, I wanted to meet with three to five investors every single week.
Mike:That’s great.
Adrien:So I did that. Same thing if they couldn’t meet in person because I have a lot of investors that are out of state. I try to spend, you know, get them on the phone for 30 minutes and pick their brain. And the idea is you kind of give and take. You want to be able to help them out. So the idea with meeting with them is, “Hey, my job is to go and find properties that fit what you’re looking for. Help teach me what you’re looking for, how you’re making those decisions that way I can go find your properties.”
Mike:Yeah, that’s awesome.
Adrien:That’s how I learned about how they make their decisions on rehabbing and what they’re going to fix. I’d also encourage people if they’re not doing rehabs to do one or two. Partner with someone because you’re going to learn a whole lot about the process by actually doing it yourself.
Mike:No doubt.
Adrien:I learned that I don’t want to do anymore rehabs.
Mike:Yeah. That’s awesome. Yeah, I think that’s a great tip is if you’re doing meals, you’re going to do it anyway. I kind of teach people the same thing. In fact, I have a bunch of coaching and mentoring students, I just gave a presentation on is use your platform or your time you’re already doing, things you’re already doing. Don’t go try to create new time to make it up.
So if you have for example, if you have a group like yours, a meetup group or even if you don’t have one, if you’re a member of one, just say hey I’m going to this group. Is there any way you can come meet me there? And we can chat.” Just kind of use what you already doing as a way to leverage . . . you’re kind of leveraging your time. Right? If you got an appointment across town in 20 minutes, then just say, “Hey, I’m free right now for the next 15 minutes . Can you jump on a call and talk a little bit?” Because you’re driving the car anyway. Your options are listen to some news that’s going to bring you down or spend some time in a productive way, right?
Adrien:Exactly. Another big thing that I do and this kind of falls into the networking with the buyer thing is a lot times the wholesaler will sell the house or property and then just kind of wash their hands of it. I’m always following up with the buyers. What did they do with the property?
Mike:That’s awesome.
Adrien:With someone who flipped it, I’m looking at the listing pictures. I’m talking with them about it. Because I’m in the property and I have an idea on the rehab in my head, like what surprises did you see? What did you do? How much did you put into it? And that really helped me become better at, one, buying the houses and also selling them to know what the end result was.
Mike:Yeah. That’s one of my great regrets with hundreds and hundreds of houses purchased, I never really kept track of what happened because . . . Well, when we rehabbed, obviously I know but happened but when we wholesale, you know, I never, I just didn’t spend the time. I could’ve had VAs or somebody say in 60 days or 90 days go look at this, go see if the house is listed, or what’s happened.
So in hindsight I wish I had kept . . . because we know we make an investment on what we think the ARV is, right? So I would be interesting overtime to see here’s what we thought it was. Because I think what’s happened actually is people often sold them for more than we thought the ARV was because we generally kind of conservative and I’ve had a couple people say, “Oh, you thought it was going to be worth this.” I had people say this, “We sold it for like $30,000 more.” I’m like, “Oh . . . you know, I’m happy for you.” But it means I have less money on the table, right?
Adrien:Yeah. I don’t actually give ARVs a lot anymore because then you’re putting a ceiling on what the house is worth. And so many investors right now are pushing the market that if you tell them the house is worth 200 they’re going to run all their numbers at the 200 and put in an offer based on that even though in their head they’re going to sell it for 225 or 240.
Mike:Yep, yep. Absolutely. Awesome. Well, Adrien, this is great stuff. So we kind of share a whole bunch of stuff today on what people can do to kind squeeze more profits out of the deals. If folks listening to this, like it’s a bunch of great stuff, they got a bunch of notes, like a little bit overwhelmed, what’s kind of one thing they should take away from this and maybe apply to business today?
Adrien:Number one thing I would recommend someone to do is call on their buyers and chat with them for 30 minutes about what they’re doing.
Mike:Awesome.
Adrien:Really building that buyers list and listen, learning what they want and making that relationship.
Mike:Awesome, awesome. Good stuff. Cool, man. So if folks want to learn more about you, I know you mentioned a couple of your club websites. Tell us the URL for that, investnwi.com?
Adrien:That’s the website for the wholesale deals. We just built it out. It’ll probably be out next week or so. It’s investnwigroup.com. That’s for our monthly group.
Mike:And by the way, if you guys haven’t picked up on it, for NWI he did say upfront he’s a Northwest Indiana kind of right around the corner of the lake from Chicago, so awesome.
Awesome, man. I appreciate your time today.
Adrien:No, it’s awesome. Thanks for the invite.
Mike:This is good stuff, everybody. I hoped you all learned a lot from this. This was episode 424. Some great nuggets here. If you kind of tuned out for a second, you might want to go back and listen to some great nuggets on how to squeeze more profit out of your deals.
Guys, if you haven’t yet, please go out to Stitcher Radio, iTunes, Google Play, wherever you listen to us at, even YouTube, and subscribe and give us a positive rating. We’d appreciate it. After hundreds of episodes, I can promise you other than spending time with my friends like Adrien here, that’s the only other thing that fuels me is adding value. And the way that I know I’m adding value, that we’re adding value is by your ratings and reviews and subscriptions. So appreciate that. Everybody, we’ll see you on the next episode. Have a great day.
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