The Science of Flipping - How To Get Your First Wholesale Deal

Episode Date: March 1, 2021

How To Get Your First Wholesale Deal

Yo, yo, welcome back to the Science of Flipping podcast. I am your host, Justin Colby. And on this episode, I want to talk to you guys about how to get your very first wholesale deal going right now. Now, if you guys are new to this channel, you will know that this is a podcast that is all about real estate investing, specifically the processes, the tools, the systems, the people for you to be able to have a profitable real estate business. And on this episode, I want to teach you if I were to start all over again, how I would go out and find my very first wholesale property. Now, wholesaling is my favorite way of investing. And I kind of

did it ask backwards, if anyone knows my story, because I started flipping first, and then I found wholesaling about five years into my journey. It would have saved me a lot of heartache and troubles, because rehabbing and flipping is a lot more difficult and takes a whole lot more money than wholesaling. For those that don't know what wholesaling is, it is essentially the function of finding a seller, lining up a buyer for that seller, and then selling your rights to your contract over to your buyer, meaning you're actually never funding the deal. So it's much easier, it's much faster, and you absolutely need no money, no cash, no credit. Now, if I were to get started today, and I wanted to go find a deal right now, a wholesale deal specifically, I would not do texting. I would not do anything that is going to cost me money.

What I will do is I will actually go find another investor who might have the property and line it up with another buyer. Now, the easiest way to do this and the fastest way to do this is through social media. All over Facebook are real estate investors promoting their deals that they want to sell to a buyer. Well, why would a real estate investor use Facebook to sell their deal? It typically means that they are not, add to your buyer's database, and then sell their property to your buyers, you will have a great relationship and you will make your first check. So let me slow that down for you. If you are just getting started and trying to get your first wholesale deal done. What I'm saying here is there are many real estate investors in your market, doesn't matter your market, that are putting their wholesale deal that they contracted with the seller on Facebook marketplace. They're also putting it in Facebook groups,

trying to find a buyer. What I would do is I would leverage that person's deal. I would reach out to that person, make sure that they are direct to the seller. And I would say, hey, if I can bring you a buyer to this, are you able to pay me a little fee inside your number? And if they say no, then you might need to mark it up a little bit. Okay. You might need to add on two, three, four, five grand to their number to make some money. But a lot of times investors will pay you a $1,500 fee or a $2,000 fee if you can find them a buyer in their price point. So now that I've had a conversation with the original investor who's contracted with the seller. Now I need to go find a buyer. So how I would do that is in these Facebook groups, there are many people responding to Facebook posts that other investors are saying, hey, I have a three bedroom, two baths here in

zip code 85032. If you're interested, please let me know. I'll send it to you. There's, you know, 10, 20, 30 replies of people in their email address. And I am going to go reach out to those individuals, contact them, build a relationship with them, let them know who I am. And then say, hey, listen, I don't know if I have a deal right now, but do you mind if I send it to you and maybe even give you a call or a text to see if you want to buy that deal? Great. Now, when you're talking to them, make sure you understand what they're actually looking for. You don't want to be sending, you know, a fix and flipper, some commercial property, you know, that is part restaurants and bars and, you know, is a big commercial strip. Makes sense. Like you don't want to send them something they're not

going to move on. So you want to know what they're looking to buy, what their buying pocket is, and essentially, you know, what they would actually act on. The fact that you're reaching out to that buyer is already steps ahead of what most investors do. Most investors put that buyer's email on their buyers list. They don't really think about it from that point forward. They start sending some emails. Eventually, you know, that buyer doesn't really ever engage with that person because that person's getting so many emails and it would, it becomes useless. But because you listen to this podcast and reach out to the buyer, you will now have a relationship that is different than most other wholesalers. And they will actually start looking at your emails. And because you asked them, if you could text or call them, they will start to have

a better relationship with you than the rest of their other relationships. And you'll be able to move deals faster. This is exactly how I'm currently doing 10 to 20 deals each and every month in Phoenix, Arizona. It's not difficult. It doesn't take any money, but it does take work. And if you were to put me in any market with zero marketing budget, this is exactly how I would get my first deal done. I would not stop until I got my first deal. Again, it does take work. You do need to reach out to, um, you know, I would probably say close to a hundred buyers before you have a buyer that you can sell them a property. But once you get that 100, you are golden because you don't need a list of 20,000 buyers. You need

a list of active buyers. I know there's a lot of gurus out there talking about how many buyers they have on their list. I call it irrelevant because I don't care. I want the buyers who actually buy the property, not the buyers who say they're buyers, but never actually take action. Now, from there, if you start going out and trying to network with other investors who are direct to the seller, like I'm advising you to do here on Facebook, you're going to actually have a full-time job getting in front of these investors, reaching out to the buyers with their deals, and you will be able to start not only getting your first deal, you will get two deals a month and then three deals a month.

And you'll have a consistency and deal flow that can create an incredible income in any market. You can do this virtually. By the way, we are doing this also in Oklahoma City. I'm having conversations each and every day with buyers and investors alike, not just me, but my team as well. This is exactly what I'm doing. If I'm put in a new market right now with little to no marketing budget,

this, my friends, will get you your first wholesale deal. I hope this really, really helped you. If you haven't yet subscribed to my YouTube channel, go over to youtube.com forward slash Justin Colby and subscribe to my YouTube channel. I have hundreds. I'm almost up to 300 videos helping you specifically in real estate. Subscribe, like the videos, and listen, I hope this helps. I hope this moves your needle and i hope this gets your first deal if it does make sure to reach out to me let me know or if you have any questions make sure to reach out to me via instagram the justin colby on instagram uh reach

out to me ask questions and i hope this can get you your first deal and you can give report back talk to you guys on the next episode peace