I have my first virtual assistant that will start working for me next month.  So until then,  I’m fine tuning my business while still getting deals closed.  The real estate market is surely changing and as CEO, I must position my company so that we can capitalize off of the market for years to come.

Changes I’ve made in my business:

• Including a repair estimate with all of my hard offers:  Prior to now, I would only send repair estimates in on my short sale offers.  But sending the estimates with my hard offers to homeowners is making a huge difference in my negotiating power and acceptances.  With the new application I’m using, proptrackr, I can create a repair estimate based on my inspection of the property within minutes.  I don’t have any knowledge of repair cost, but the system gives you approximate figures and creates a professional pdf format repair estimate for me to present to the seller with my offer.
• On my craigslist ads for wholesale buyers, I don’t include my email address, only my phone number:  I decided to do this because I was getting inquiries from a number of tire-kickers and decided that if I have them call me, I can pre-screen them.  I performed split test marketing, where some of my ads had a link to my website, and others would just have a number.  After testing each strategy, getting calls deemed to be more effective.  I don’t include my personal phone number in the ad, but I put one of my Google Voice numbers instead.  Google voice is awesome!  It’s free, you can forward it to any of your pre-programed numbers in seconds, and you can have it go directly to voicemail when you don’t want to be disturbed.  I’ve gotten great results with this and picked up several new buyers that I probably wouldn’t have if they had emailed me……  The fact of the matter is, you must talk to people in this business.  Internet is great for gathering leads, but you still must have a conversation with people in order to really get a grasp on how you can better serve them.
• Making it a habit to ask everyone I come in contact with the same question, “So, do you rent or do you own?”  You would be surprised at how many leads you can get just by running your mouth.  I’m making it a habit to ask at least 5 people a day this question.  There’s always somebody, that knows somebody, that needs my services.  I gave my card to a lady, that gave it to a family member that was in pre-foreclosure.  The seller called me and we are in the process of performing a short sale on the property right now.
• Ask for owner financing initially in every deal.  I should be doing this anyway.  I’m making it a habit to ask for this first.  Owner financing provides solutions to buyers and sellers alike.  As a seller, you are able to open up the pool of available buyers to your home and not limiting yourself to only buyers with cash.  For buyers, owner financing is simply borrowing funds to purchase a property just like you would with hard money or private funding.  You are simply having the seller hold a note for the purchase price.  There are a number of ways to structure and owner financing deal, but that is beyond the scope of this post.  I’m currently going back through all of my leads from the past several months and contacting sellers to see who wants to sell via owner financing.  I’ve closed a handful of owner financed transactions and the results were very lucrative.
• Stop being so controlling.  This is a huge step for me.  I’ve always been the type of person that said, “if it needs to be done right, then only I can do it”.  Putting trust in others to get the job done has been hard for me to accept, but my business and life depends on me being able to make this transformation.  I must leverage my time.  My VA that will start working with me next month has experience with real estate.  She works for another investor and he has already trained her.  All I have to do is fine tune her on handling my business.  I’m sure working with the VA will be great and allow me more time with my family.

These are just a few minor adjustments I’ve made in my business.  I will continue to practice these tactics and make changes as I see fit.  Practice doesn’t make perfect, but it does make improvements.  Be sure to make adjustments in your business and practice your new implemented actions.  Analyze your biz to see if your tactics are improving overall revenue.

Happy Investing!

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To begin with, one of my strong strategies for effective marketing is to invest in heavy usage of  bandit signs and direct mail in order to find extraordinary deals.  My system is designed to alert me via email when someone calls the number on my bandit signs.

Well, today while doing a typical afternoon drive-by on some new leads and perspective properties, I got an email from a seller via my bandit signs.  The email surprised me because the message was from none other than a bank.  I was puzzled,  I have never known banks to call bandit signs. But this really showed me the sign of the times in Real Estate.  There are properties out there that banks own that they are really desperate and anxious to get rid of.  Believe me I have no problem with lifting the burdens off their books, at a reasonable discount, that is!

I was very curious as to what this bank wanted to discuss and how they found out about my business.  I, without hesitation, called the person whom contacted me back immediately.  I politely introduced myself and extended the same courtesy to him.  He begin to explain to me why he contacted me.  He indicated that he had  gotten my  number from a borrower that got it from one of my many bandit signs. He also said that the borrower was about to go into foreclosure and is looking to sell the property fast.  The borrower gave the number to him so that they could work something out with me directly.  The bank representative went on to say that the borrower was willing to sign over the deed and cooperate any way necessary to get the house sold.  WOW!!

I was thrilled to get this call and began explaining to them how my company could benefit them and what solutions that we could prospectively offer.  I also explained to him that in order for us to purchase the property via a short sale, we needed to be assure that the process would be quick and simple.  He totally understood and he provided me with more information on the property.

Getting this call from this bank today, was my confirmation that now is the time to buy real estate.  The tax credit has ended, buyers are not motivated all, even by the low interest rate.  Banks are the most motivated sellers in the market right now!

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In order to make an offer on a property, you must first know your market.  All markets are different and what’s a great deal in my area may not work for investors in your area.  Find out what the average sale price is for your target area.  Once you have studied your market, acquire some good comps from an agent to determine the “After Repair Value” , or ARV for the property.  Having an accurate ARV is very important for determining an offer.  If you overprice a property by $10K that is surely valued under $100K, then you will end up offering too much and you probably won’t be able to wholesale the property.  I recommend that you always double check the ARV for a property to be sure you are in the range of a few thousand dollars.  Or better yet, have your partner or someone else come up with an ARV and see how close your numbers are.

The formula to calculate an offer amount for a wholesale property is the Maximum Allowable Cash Offer or MACO formula.  In this formula, you need to know the ARV and an estimate on the repairs.  I use $10K as the minimum repair estimate on every house unless it is brand new.  This gives me some cushion in my offer, besides nearly every house can stand some upgrades.  For wholesale deals, always factor in an assignment fee of $10K.  Using the MACO formula is a safe way to calculate an offer price as along as you have an accurate ARV and repair estimate.

Say we have a home with an ARV of $100K based on the comps.  The home needs approximately $15K in repairs for it to be in great condition.  Here are the numbers:

MACO = Maximum Allowable Cash Offer = ?
ARV = After Repair Value = $100K
RE = Repair Estimate = $15K
AF = Assignment Fee = $10K

MACO = (ARV x 0.65) – RE – AF

MACO = ($100K x 0.65) – $15K – $10K

MACO = ($65K) – $15K – $10K

MACO = $65K – $25

MACO = $40,000

The Maximum Allowable Cash Offer is $40,000.   If you are not ashamed of your offer, then it is probably too much.  Your initial offer is always zero because you should never be the first to state a sale price.  Allow the seller to state a sale price first.  He who speaks first looses  = ) .  That’s an entire different post.  Sometimes you won’t be able to make that $10,000 fee.  This is fine, you can’t hit the ball out the park on each deal, but you can try.  Your fee may be any where from $3K – $15K.  I’ve closed several deals where I’ve only made $3K.  The idea is that you can make money if you know the market and stick to the formula.  Always be sure to include a contingency clause in your purchase agreement in case you need to renegotiate the sales price or back out of the deal.

Remember, great deals are made, not found.  Happy Investing!!

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At this point I ordered 100 fresh new signs and stakes.  I shied away from the yellow signs and went with the blue-on-white.  I also made some adjustments in my message and included, “Cash in 48 hrs”.  I knew that this would definitely get the eye of many motivated sellers.  Once my signs came in, I watch the weather report to be sure that the following weekend wasn’t a rainy one.  I prepped my signs by putting the stakes in them.  That Friday evening, my help and I went out to put the signs up.  I was driving and my trained assistants, Brandon and Jay, put the signs out.  When I would pull up to a corner of a busy intersection, they would hop out of the truck and put signs on the corners.  I usually put signs at all four of the corners at busy intersections though some may only need 2 in the directions of the flow of traffic.

Bandit signs are not placed directly on the corner of an intersection.  This is a No-No!  You should place your signs approximately 10 – 20 feet from the corner of an intersection.  This way when the traffic is stopped, the 2nd, 3rd, and 4th car can read the sign while they are waiting at the light or stop sign.

Normally people don’t write down your number when they see the sign initially.  Just like with direct mail, people respond to the 3rd or 4th sign the see. As I was telling you about my first experience with bandit signs, it wasn’t so great.  The reason why is I only put out 25 signs.  This wasn’t enough to generate me a deal based on the research I’ve done in my area through trial and error.  But when I got my new signs and put up all 100 in one evening, the response was totally outrageous!!  I mean, the first week I got well over 60 calls.  The calls continued for 2-3 weeks.  By the end, I had received well over 100 calls.  This resulted in 4 contracts and 2 closed deals.  Profit from these two (2) deals, $8,200 ($5,200 check and $3,000 check).  That’s $8,200 from 1 month worth of work.  Imagine how much marketing can be done with $8K!

You must first research your market and see what area or zip investors are buying properties.  Once you have a target area, you want to flood it with bandit signs.  If you don’t get any complaints on your bandit signs, then you don’t have enough signs out.  I usually get 1 or 2 calls from people complaining about my signs.  The more the better.  Generally 100 signs will generate at least 1 deal.  Some areas may take more and others may take less.

I had something happen to me that was a first last month.  In the video below, I put up two signs while making a video of how to put up bandit signs.  I only put out 2 signs because they were the only ones I had.  Anyway I got a call from those signs and got a deal.  I put it under contract and called only 1 investor.  We scheduled a time to look at the property and he put it under contract.  That one deal I put in about 1 hr of work and made $3,500.  This rarely happens, but I was really flattered.  You don’t want to chance putting out too few signs.  Go ahead, put the work in, put out 100 signs  and get that deal!

In the video below, I show you how to put bandit signs up.  Enjoy…

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Twitter is one of the fastest growing social media sites on the web today.  A number of people don’t fully understand how to use twitter to maximize on business profit.  There are a number of twitter tools/applications available on the market today to help you integrate your business into the social media world.  As technology advances, these tools become outdated, except for Tweet Attacks!  People using twitter want to read updates from real people and not automatic post or API.  I’ve recently been introduced to, in my opinion, the ultimate twitter tool, Tweet Attacks.

The Tweet Attacks software will allow you to integrate your business into twitter social media and you will appear as a real person.  Not only that, you can target certain keywords that you wish to target and respond too.  This system is awesome!  Already 1 week in and my network is growing.  Take a look at the video below.

Unlike a number of programs on the market, tweet attacks  is a one time fee and the system is yours for life.  You also get constant updates for life.  The system comes with a 7 day money back guarantee.  You can purchase the system at a discounted price here.

Here are some of the features Tweet Attacks can offer.

• Automatically follow users with the same interest
• Automatically follow users that are in real need of your products and services
• Automatically follow the followers of users who are already popular in your niche
• Ignore users with no pictures and who tweet links to minimize following spammers
• Follow users from other users lists
• Follow users with your specified random number of users in a specified random time intervals
• Follow and unfollow users using the web browser and not API to appear more natural
• Auto unfollow users who don’t follow you back
• Auto unfollow users you followed in a specified number of days
• VIP list and protect very special users from unfollowing even if they don’t follow you back

GET TWEET ATTACKS, WITH THIS DISCOUNT CODE LINK.

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The recent home comparable sales method uses comparables or comps.  Comps are properties similar to the subject property as far as size (sq. ft.), bedrooms, baths, age, and lot size.  In addition to this, comps should be homes that have sold within the last 3 months, no more then 2 miles or less from subject property, and preferably MLS comps (comps from a Realtor or agent that come from the MLS).

To find comps, I suggest that you have a real estate agent on your team that can supply you with some recent ones.  But if you are unable to get some comps from an agent, there are a number of other resources available.  Here are a few of them:

• Zillow
• Trulia
• Cyberhomes
• RealQuest (paid service)

With these comps, you can begin to get the FMV of the property.  Begin with the comps closest to the subject property then work your way outwards but no more then 2 miles from subject.  I like to stay in less then a mile from the subject property to get a more accurate value.  Determine the cost per square foot for each comp.  This is determined by dividing the sale price by the total square footage (sqft) of the property.  Below is an example of how to determine the cost per square foot for a home that’s 1,048 sqft and sold for $74,500.

$74,500 / 1,048 sqft.  =$71/sqft.

Based on the calculations above, this home sold for $71 per square foot.  To check your math, if you multiply the $71/sqft times the total square footage of 1,048, this equals the sale price of approximately $74,500.  You want to find a minimum of 5 comps, but if you are only able to come up with a few, then you will have to use them.  After you’ve found the cost per square foot for each comp, you want to discard the highest and lowest values if you have five comps or more.  If you have less then 5 comps, just simply use what you have without discarding any.

Now you must determine the average for all the comps you’ve accumulated.  Add all of the cost per square foot up for each comp and divide by the number of total comps you have.  This will give you an average cost per square foot for the subject property.  Take the square feet of the subject property and multiply it by the average square footage that you came up with in your calculations.  Below is an example.

Multiply by the total square feet of subject property: 1,097 x $63 = $69,111
The FMV of the subject property is $69,111

The fair market value of $69,111 isn’t necessarily the value of the home.  If the property needs repairs, this must be taken into consideration.  But the FMV does give you a value for the home if it is in great condition.

Tags: determine property value, estimate property value, find property value, home comparable

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How To Turn $500 into $5,000 in 28 Days
Using Wholesale Real Estate

(coming July 2010)

Dear Friend,

Torrey Brothers is my name and Wholesale Real Estate Investing is my game! I reside and operate  Hot Wholesale Rehabs, out of  Greensboro, NC.  When we first started this business,  we struggled in the beginning, as all businesses do. The biggest obstacle at that time, was that we were unable to be consistent with marketing, therefore, limiting the amount of  deals that we needed to continue to operate.  Closing on the deals was not the issue.  I would close on a great venture and then wait months and months before another deal was lined up, and that was the problem! Indeed it was frustrating and we needed a solution.  So we researched and realized that in order to truly be successful in the wholesale real estate business, one mustMarket, Market, and Market for properties continuously! The deals are there and you can keep the deals streaming in the pipeline without delay with a few simple steps! We finally learned the marketing strategy that would guarantee a successful deal 99% of the time. We continued to repeat this marketing system and continued to get the HOT leads before any of the competition! It’s very easy, learn your market and area to find out where the money is flowing, and in this eBook, I will show you how to do just that and how to get in front of the action. In real estate investing, the opportunity’s are there! Wholesalers and fix & flippers are a great resource for keeping a steady cash flow too.  HOW TO TURN $500 into $5000 in 28 DAYS, will show you how to aggressively market so you can get paid! I will walk you through your first deal and show you how to make wholesale real estate work for you !

Who is this eBook for?

HOW TO TURN $500 into $5000 in 28 DAYS is for you, the beginning Investor! I will give you the step by step process to getting that first deal closed using as little cash as possible.  This eBook will be your blueprint to get that first deal under your belt! After the first deal, you will have more money in your bank account and plenty of funds to do more marketing and get more deals.  HOW TO TURN $500 into $5000 in 28 DAYS is your private resource for getting the first deal closed without paying thousands of dollars for a costly seminar. I can get you the same results for pennies on the dollar! No travel costs, seminar cost, material cost, shipping or handling cost…Just 1 small price to pay for 1 great tool, that will bring a lifetime of real estate success!

I look forward to working with you!

What Will You Learn in This eBook?

This priceless information includes……….

• What to do first and foremost before you begin your marketing

• How to get every motivated seller in your area to call you

• What to say to sellers instantly to determine if they are motivated

• How to determine how much to offer on a property

• How to secure the deal without any of your own money

• The fastest way to build a buyers list

• How to lock in your buyers

• How to estimate repairs expenses

• How to secure and  collect your assignment fee

And Much More……..

You will also get my email address so that you can ask as many questions as you would like.

We are giving away a limited amount of free copies to some fortunate investors.  Could Be YOU!!  Imagine getting your hands on information that, if done properly, will generate cash for you within a month!  If you would like to have the opportunity to get a free copy of this content packed eBook, “Sign Up Below!”

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If you wholesale properties to other investors, you want to know what area these investors are buying properties.  One sure way to determine where investors are buying properties is by reading your local Housing Report.  Every quarter, 3 months, your local city Realtors Association releases a detailed housing report for your city.  This report shows the statistics for your area, what’s selling in the different city zips, days on the market, what different price ranges are selling, and the direction your market is heading. In the video below, I go over the most recent housing report for my area, Greensboro, NC.

Housing reports for your area can either be found on the internet or obtained from your agent.  If you search the internet, you want to enter your local city Realtors Association.  For example, I’m in Greensboro, NC, so for my search I entered “Greensboro Realtors Association”.  Depending on your city, you may or may not be able to find the “housing report” on the internet.  If this is the case, all you have to do is contact your local agent and ask him/her to send you a copy of the most recent housing report.  If you have questions, you can have your agent explain the housing report to you.

Remember, real estate is simply a numbers game.  Learn how to read the numbers, and you will be miles ahead of your competition.  In the video above, I point out what to look for when you read over the housing report.  I also encourage you to read the entire report several times so that you get a clear understanding of your market.

In the video I point out the two zip codes in my area that have the most sales for “bread and butter” properties.  ”Bread and butter” properties are those that investors like to buy to rent out or sale creatively with owner financing or lease option.  You can take a detailed look at the Greensboro Housing Report 2010.1 below.  I would love to hear your questions and comments.

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The President and my good friend, Barack Obama, was on a comedy roll at the “White House Correspondents” dinner on Saturday. He did kill it!

Some of those in attendance were comedian Bill Maher, GOP Chairman Michael Steele, Mayor Michael Bloomberg, actor Michael Douglas, and comedian Jay Leno.   The Pres is hilarious, what do you think?

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In February I challenged myself to make $75,000 in 90 days, a challenge similar to what Jason Rodriguez and I embarked on in late 2009.  I must admit that after awhile, I began to loose focus.  Looking back at it, I would change the time frame from 90 days to 30 days and the monetary goal from $75K to $25K in 30 days.  This would allow me to focus my concentration for a shorter period of time.  But overall, I did get a couple of deals closed in my own personal challenge.  This self challenge was very healthy and educating.  Based on my marketing, I realize that for every 100 signs I put out, I get about 1.5 deals.  This is important to know because each market is different.  So you must test your market to see what is the average response rate for your marketing pieces.

I put out 100 signs in my area.  Out of the 100 signs, I got over 50 calls easy.  Most of the calls were indeed junk, meaning no equity, seller stuck on stupid, or just not good deals.  But when I did get a call from a seller that just wanted to sell, like yesterday and willing to sell at a significant discount, it was well worth the effort.  I learned to keep all my leads and follow up with them monthly because people’s situations change.  The numbers show that once you contact the seller in the 4 – 5 follow up, your chances of getting a great deal are significantly higher.  But you have to be a “Go Getta”.  This is serious business, you can’t be fucking around.  I don’t go see a house at all, Period!  Number one, I don’t have the gas to be riding around viewing homes.  Number two, most sellers are not motivated enough for you to waste your time.  If I go to a house, I’m going with the intention of getting it under contract, I don’t get paid to look at houses.

My 90 day challenge ends in Mid May, just a couple more weeks.  So far I’ve closed 2 deals specifically from my “challenge” marketing.  My total take thus far is around $14,000.  I will close on one more deal by the end of the challenge.  I will let you know how that goes in a couple weeks.

I’m focusing my marketing on two specific strategies and I’m going to work them hard.  These two strategies include bandit signs and probate marketing.  Here is my take on bandit signs, “if no one is complaining about your signs, then you are not putting enough out”! People should be calling you complaining that your signs are everywhere, and then you’ll know that you’ve put out enough to attract some attention.  I’m in the process of ordering 300 signs and going to flood Greensboro with blue and white signs.  I spoke with another investor and he said he hates signs.  That’s because he only put out 40 signs.  But that’s fine with me, less competition.

Let me recap on the keys to wholesale deals.  Number one, you have to do a ton of marketing.  Picking two forms of marketing and focusing on them has worked well for me.  Number two, the money is in the follow up.  This is where ivnestors loose their head at along with stacks of cash.  Do a ton of marketing and follow up on your leads every month to 45 days and you will be on your way to big pay days.

I’m out marketing so the next seller can find me.  “I’m here Mr./Ms. Seller, CALL ME….”.  This is the life of a “Go Getta”, damn right I’m a “Go Getta”!  Are you?

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