All Forum Posts by: Jim Pellerin

Hi Bryan,

I'm a big believer in investing in a syndication or apartment buildings over SFHs. If you have $200K, go raise more capital and buy a 100+ unit apartment.

I read the linked article. So a couple of questions?

1. What's the difference between a syndicator and a sponsor and a general partner?

2. Which are you?

3. Are you currently looking for investors, properties or sponsors?

Here's a an overview that I recommend for anyone getting started. Not the fastest and most financially beneficial but the easiest way to get started and ease your way into it.

1. Decide on an area you want to work in. Pick an active area where theres lots of wholesaling. This will expose you to other wholesalers and lots of buyers.

2. Build a buyers list. A good way to do that is go into a Facebook group "wholesaling in Orlando" for example. Read about a months of posts looking for cash buyers and see who's replying to properties for sale. Reach out to people who look like buyers. Ask if you can add them to your list and get their email. This is tedious and takes a bit of time. I found about 100 people in just 1 weekend. That's a good start.

3. Find acquisition wholesalers to partner with. Stay away from people that are sending out big list blasts. Chances are your buyers are already on there and most of the deals on these lists are not that good. Search in FB groups the same way as above. Check out Craigslist, FB marketplace, Zillow, FSBO sites, etc. Most acquisition wholesalers don't like to partner but keep looking. Its called co-wholesaling or JV-ing. And some wont want to split their fees and tell you to just add yours on the deal. This drives the price up and hurts the deal.

4. You can start looking for your own deals at the same time. I wrote a post on how to do that on this forum. This will take awhile. 

You probably have to look at 100 deals, analylize 25, offer on 10, close 1. This is a job and you need to be putting in the time. Some wholesalers make about10 to 20 offers a day.

Hope that helps.

 Theres 2 views to this.

1 view is, go find a great deal and the investor will find you.

the other view, and the one I believe, is go and create a buyers list first. Then the pressure is off when you find a property.

 Most know about this now. I was able to add it to my existing policy for next to nothing. I just had to add the city as an interested part as well. They would be notified if the policy was every cancelled. .

@Spencer Gibson This has always been my argument against SFH investments. Low or no cash flow. I had 100 at one time and I hated it. Even with a Property Management firm, I was heavily involved and I didn't make an income.

My recommendation is ... don't do it. Find a way to syndicate with other investors. Raise a bunch of capital. It's easier than you think. Purchase a larger (50+ units) multi-unit that is self-managed. Why have 50 individual units to manage, when you can have 1 that has 50 units in it. 

I think it depends on the volume of transactions you want to do and the type of investing. If you are a 5 deal a month wholesaler, than yes. Especially in states that require it to do wholesaling. Like Illinois.  

If you are a one every 2 year buy rent and hold investor, than no. 

The big disadvantage is you are also buying any liabilities associated with the company. You could be exposed to all kinds of ongoing legal actions etc. Make sure you do a lot of due diligence.

If you are using Airbnb they will already have done the leg work for you. When you go to register with them they will identify a requirement that you need register it with the city. That usually means getting a city permit to allow you to host a STR for your property.

 It depends on how motivated the seller is and if he needs the cash to purchase his next home.

I like to start with full asking price and 0% interest. For say 3 years. The basic premise is that it gets the place sold and he can move.

If they counter, it usually is with a low interest rate of $3% or thereabouts.

If they need the money, then it's not even an option.