All Forum Posts by: Darwin Crawford

Ok.  So I'm on a BP streak this week, and stumbled on this.  

@Account Closed has to say on this, he's got more deals under his belt than most on here.  

To answer your question, its going to go like this: 

1) Address of house/houses you want to buy

2) Find the owners, usually via a skip trace website or something similar, or asking around.  Property radar dot com can help too if you are on a budget. 

3) Call the owners up, see if they want to sell.  If they do, negotiate a price. It must be low enough that another investor would want to buy it.  If its too high, you're dead in the water.  

4) Place a contract on the property, open escrow (although AL might be a lawyer state, I haven't done a deal there in a few years), and then start contacting flippers.  

5) Understand that wholesaling any home in an area with low demand (rural/small towns with slow economies) is going to be tough.  We used to cover the whole state of Alabama at the office and only sold deals in Birmingham and Huntsville.   In slower economies, we literally paid $10 for houses sometimes.  Not a typo.  

6) Invest in some training.  If you truly want to do this, it will pay back multiples of whatever it costs. 

Phew.  Ok man, gonna give it to you straight.  I have trained up quite a few folks in WHSE offices, and here is how it works.  No sugar coating.  

1) WHSE is a business.  It involves systems, money, and repeatable models.  It is highly location dependent, and takes money to do correctly.  

2) you need training.  You don't need a mentor, because as a newbie, you literally have nothing to bring to the table other than work ethic and time.  You need concrete skills that can translate directly into deals.  Go get them.  You can pay for them or develop them on your own.  Paying for them can be, but is not always, a way to get them faster. 

3) this forum has a lot of knowledge, but also a lot of hot air.  Like any other forum, anywhere, on earth or possibly elsewhere.  And most wholesalers are completely full of you know what.  You can usually tell how full of it they are by how loudly they claim not to be full of it.  

4) Learn how the business works.  Have realistic expectations.  Don't listen to these clowns on social media posting their checks.  They spent that check way before they ever got it.  

5) shameless plug here, but I literally give away a lot of the training that professional offices use on my YT channel.  I don't really care whether you watch it or not, I don't make money off it, but I can assure you it works.  I also watch a lot of people fail at this because they don't know what they're doing.  

6) If you really want to know about the business, I wrote it all down here: https://www.biggerpockets.com/forums/93/topics/525099-how-to-be-a-better-wholesaler-with-faqs

Wishing you all the success in the world, but it must be earned.  

@Donald Walker - "How is the market for wholesaling in PHX"

A: It's crowded AF my friend.  As in really effing crowded.  Handful of large offices with equally large budgets for data aggregation and sorting, call centers, and a handful of poorly trained reps.  

They do get some deals.  No arguing that.  However, the big money in wholesaling comes from being able to connect with people who can sell deals to newbies, who tend to overpay.  

Full disclosure, I've worked with several offices here in town, not doing it currently, and trained quite a few of their reps.  You can certainly make money at it, but you'd better have sharp skills, a work ethic, and the ability to learn to love the word "no".  

I also know a handful of small operators that do well, 1-3 deals per month, but it took them a bit to get there.  Lots of cold calling, ad spend, etc.  Most don't see any money for 60-90 days.  

Bottom line - its kind of a street rat culture, lots of low-level hustler types who like to post checks to their social media, rent flashy apartments, and other silly stuff, but the good ones do well.  

So just be a good one, and you'll be fine. 

@Levar Cooper - just so you know, PHX is basically ground zero for wholesalers/wholesaling.  

Some great people in the business, and some not so great ones.  Just do your homework and you'll be fine.  

Don't overpay, there are always more deals out there, despite what a lot of people might lead you to believe...

Welcome to the valley, its a great place to live and invest.  

@Brad D. - my old office used to sell to Invitation and Progress Residential, who I think have since merged.  

Chandler/Gilbert Queen creek are super hot markets right now.   

Parts of Mesa are great, others are not - get an agent that knows the area there.  

Surprise I don't know much about at all, ditto on Litchfield Park, other than having wholesaled a lot of deals, but those are all flippers.    

Peoria is another that can go either way - got some good some bad.  

If it were me, and I was a remote landlord, I'd stick with Chandler/Gilbert/Queen creek.  Better schools, better demographics, and lots of 80k/yr jobs.  Will be tougher to cash flow but easier to manage.  The further out you go the more subject to valuation drops you will be. 

I'm a local guy, so I live and invest (personally) only in Scottsdale, but that might change in the next year or two.  Deals are getting skinny here.  

Another place to look is Laveen.  I have a good friend who is a teacher out there, on her way to administration, and the schools are great, well funded, and its growing like crazy.  Pricing isn't too bad right now either.  

the small MFH sector out here is insanely competitive.  Lots of syndicated California dollars you will be competing with, and they aren't scared to pay over asking in cash.  Those are niche plays, and you better have super sharp management.  This is the space where I am, and its basically a lot like a barfight, just less organized.  

Above all - stay out of HOA neighborhoods. They are, 9 times out of 10, a nightmare to deal with.

@Brad D. - for that price point, I'd tell you to go look in Maryvale, within PHX metro: https://www.trulia.com/n/az/phoenix/maryvale/80438/

Its got some deals, but gets murdered by the wholesalers here in town, so you're going to have tons of competition at the price point you want.  PHX is basically ground zero for wholesaling.  For better or worse...

But it's doable if you want to do the work.  

I had a duplex in Casa Grande, it worked fine, kinda sub-par tenant base, and the schools suck, but it's supposedly getting better.  The management down there isn't awesome, but I'm sure you can make it work.  Water bills can get high pretty quick, and the local water company has a monopoly on it just FYI.  Fine as long as you factor it in. 

@Brad D. - good flyover question, but being honest, that is the type of advice agents dispense and get paid for.  I am not an agent.  Tucson is just a smaller town, and comes with all the pros/cons of any other smaller town.  

Might help us all here to assist you if you shared what you are looking for?  i.e. cash-flow, appreciation, blend of both, etc.  as well as what your risk tolerance and desired price points are.  PHX metro is about 85 miles east to west, and has many, many, many options for investing.  

I'm with you on buying the dip, however I can tell you there are bargains to be had in any market, if you are willing to put in the work.  

Buckeye can be a great spot. Because it's cheap, you can actually get some cash flow with SFR's, which can be tricky to do in PHX metro right now.

On the flip side, the outlying communities like Buckeye, tonpah, etc all take the biggest hits in value when RE slows down.  

the one thing I will caution you against is the presence of "rural ghettos", which are HOA/Cookie cutter neighborhoods in phoenix that look nice from the road driving by, but are a nightmare of maintenance and low quality tenant bases. They aren't as common as they were, but some do still exist.

Also - construction labor here is very tight right now, so just put a warranty on anything you buy, there are a lot of really shoddily built homes being sold right now, and they builders are out the back door as soon as you close.  

AZ has a long history of boom and bust, and we are booming right now.  Plan accordingly, inspect what you expect, and its a wonderful place to invest and call home!

Well.  I closed on it.  

And as expected, its a DUMP.  As in a total dump.  

Lender got the job done, took a few of the usual "hurry your a$$ up" calls but we managed.  

@James McCreary - happy to hop on a call sometime and do a google map tour, just let me know what you're looking for.  

My contact info is in my profile.  

Team BP - hope all is well.  

Snagged a 4-unit building here in AZ, working through escrow right now, and wanted to share something I've found.  

Long story short, the place is completely clapped out, and needs a pile of work on the outside/mechanicals, and the price reflects it.  

Historically, funding has been my achillies heel, so I went digging.  Found 2 lending programs that I'm very happy with so far, not pitching, just sharing.  PM me if you want actual contact details.  

Lender 1 - based in LA, CA - does 8.5% "hard-money" type loans for acquisition and repositioning. 80% LTV and once you've done a deal, they'll do purchase/reno on your second one. Their weapon - speed. Hard money at a discount. Tastier than a box of donuts.

Lender 2 - also CA based. this one excited me a lot, they have a 30-year fixed product that is lease-based, and 80% LTV. Basically, if your credit doesn't suck, (700+) and your existing leases cover PITI, you can get fixed financing, they do both multi-family up to 10 units and mixed use, but nothing commercial...I tried.

The rates from lender 2 are about .75% higher than a full-doc conventional (just had a friend close one), but to me, the lease-based thing without worrying about DTI's was a big relief. They also don't mind raggedy stuff, so if you have a nasty one, they work well.

Right now we are a week in on lender 2, and they have my approval on the table for this friday, and can close 5 days after.  

Yes, I'm paying a little more in interest, but the deal can handle it, and as we all know, moving quickly is about the only way to snag deals in certain markets...

Hope that helps!

Happy Investing!

 - Darwin