Roger thank you for your input. Now please take your seat before I have security remove you from the building. :brow
Sorry if that upsets you, Deal. No ill will intended. I merely answered the question(s) that you asked.
Last post, then. If you don’t think that you can handle the answer, don’t ask the question.
Raj
I handled your answers just fine Roger. Now sit down and behave yourself. And don’t get your feathers all ruffled. :rolleyes
DealMakerGH,
Being in the landlord business, I am very suspicious of people who make wild claims. All you have to do to see what I mean is watch a couple of those silly “flipping” shows on TV. They give the purchase price, the repairs, and the asking price and pronounce the profit, even though the property isn’t even sold. In addition, they totally ignore the holding costs, income taxes, etc, etc, etc. In reality, they MIGHT make half of what they claim.
The same is true of the rental property business. How many people claim to have a positive cash flow yet only subtract the mortgage payment, taxes, and insurance from the rent. They think they are making a profit, but are really losing their butt.
Every single time I’ve seen someone make wild claims about the money they make in REI, it turns out they are a fake. There used to be someone on this forum who claimed to make $50,000 per month as I recall and yet he also claimed to never have a vacancy. I don’t know of a single person with a substantial portfolio that has never had a vacancy. Another person was offering mentoring but thought the only expense associated with rentals was the mortgage payment.
All I’m saying is that I think the silence was deafening. I don’t believe there are very many people making $200K in actual spendable cash on real estate investing. Those that are consistently making that kind of money are running a business, not hanging bandit signs and playing silly guru games.
Mike
I think that the sky is the limit in real estate more than any other game. I will probably pass the 200k mark in august for wholesaling, and flipping, that income would be on top of my realtor income which is fairly decent as well.
I am positive without a doubt that I COULD make 300-400k in wholesaling if I tried, I honestly have begun to lose the spark that money once brought me. To be perfectly frank money doesnt do it anymore, I am beginning to realize money like so many other things in life isnt that great, once you have been there and done it.
Show me a pretty _______(girl or guy), and I will show you someone who’s sick of _________(Insert clever slogan here) Thats how money is too me I guess.
I have my dream job, my dream wife, my dream child, my dream bank account, my dream cars, and I am 31. I own 30+ rental units, I have 5 employees, I pay someone to pick up my rent, to file all my paperwork, to fix my toilets, to clean up my trash, I have even payed people to push deer to me on the last day of hunting season. I do what I want, when I want, how I want. I have been able to keep my dad from having to go back to a normal job because he can work for me whenenver he wants. I save alot for “retirement” but my definition of retirement is doing what I want, when I want, how I want, so I am essentially retired. I guess what I am getting at is after your essentail needs are met money is just a score card for how well you do what you do, it provides a means to never have to do anything that you dont want to do, but…
To people without alot of money it is the light at the end of the tunnel, its hope, its when your going to be happy, its retirement, its freedom. I was the guy without money for a long time. Then when I actually got it, I realized that I was just as happy when I didnt have it, in fact sometimes even happier.
I can remember in college thinking boy I will have made it when I make $30,000 , then I made that, next practically the same moment I hit 30k I thought, i certainly will feel big time when I make 50k. Then I started creeping on my first year at 100k, still I wasnt having that “money feeling”. I passed 100k and started to realize that even if you dont spend more, when you make more, you still think that your “money feeling” is just around the corner. Heck I remember living in my $105,000 home and between my wife and I we made $230,000 and still no “money feeling”.
Its the funniest thing, I had four closing in a day in January and cleared near $100,000 but I get more happiness or “money feeling” when I sell a stupid $30 audio program, it makes my wife crazy, in fact just today, I was bragging to her about audio courses which added up to like $90, (the price of dinner) and I forgot to tell her I made $10,000 on a wholesale deal, and sold 2 houses. Go Figure.
Sorry for the rant but it just got me thinking…
Like the others said, it is a business like any other business, but it is overhyped more than any other business. I said it before, and I will say it again… it reminds me of the gold rush… the people who made the money are those who sold the shovels.
There are tens of thousands of restaurants, and everyone claims restaurant business is profitable… yet 90% of them don’t make $200k. Same in real estate… If you don’t set it up as a successful business, it will never succeed. If you do not manage it right and work on growing it, it will not succeed.
Now, I don’t know why anyone wants to earn $200k wholesaling only. That to me is a poor business plan.
To answer your question, I have not even come close to that point. I have built some equity, but not cash and if I cash it, I won’t get all of it of course. I am one of the few lucky and smart ones who held on to their jobs while learning the business. I do however, see me doing $200k/year in about a year and a half from now.
Well, I personally am glad that Dealmaker asked this question. I love hearing other people’s successes (the real ones, not the fantasy ones) and I love it when actual numbers are included.
Asking about specifics seems much more acceptable online than asking someone directly at a party or professional networking event. Different vibe here.
But then again, my day job is being a psychologist and everyone knows we are all voyeurs. :biggrin
Topaz
I could not agree more, It is a great question because normally someone would not ask it. In a forum situation it is an even better question because it allows you to tell who is “Doing what they know” rather than most people who may or may not “Know what to do”.
Generally you can tell the people that are well experienced rather than well read. Experienced people can give you the in’s and out’s of every part of a wholesale deal. I could get on the phone for 2 or 3 hours with someone to discuss little intracasies of deals. Because I still sell real estate as well, I learn quite a few new things every month, things that would be difficult to get out of a course, you can only get from doing, or very very closely following someone who is doing.
Making $200,000 in California or an expensive market could be done with a few good transaction, in my Market here in Michigan, $200,000 requires quite a few wholesale and flip deals. One good 1,000,000 home with a 20% return can get you $200,000. In my market to reach those numbers I will be doing around 13-20 deals. My first couple deals this year were between 30%-110% returns.
“Now I dont know why anybody would want to make $200,000/yr just wholesaling, that seems like a bad business plan to me”
I hope I am taking this out of context, but is a real estate investor with a great business plan and minimal profits, somehow better than a real estate investor with a bad business plan and $200,000 profit.
I am hoping that you mean that you would try to diversify yourself a bit better, and open up your options. That makes sense to me. My goal is to make $100,000 as a realtor, and $200,000 as a flipper/wholesaler, and make a bit off of my rentals which I just put towards principal anyway.
Real estate is far far from rocket sciece, sure there is a learning curve but just about anything worth while requires learning. I like the comment about the only people making money during the gold rush were the people selling shovels. I was talking on the phone with one of the countries best selling real estate authors, and picking his brain about some ideas. One of the things I was so curios to know about was why nobody had put together any R.E courses that laid everything out simple, and effective. I wanted to know why most anything to do with real estate ends up taking up a 300 page book or 12 CD’s with thousands of minutes in audio. I was stunned by his answer. Essentially he said that if it was made to look simple, there would be no “percieved value” and prices would end up way, way lower on course material even though it was far more valuable and understandable to the end user.
To drive this point home even further, stop and think about all of the E-books and Audio courses online, typically they show a whole layout, of books and CD’s that you will be getting so that it looks like this vast quantity of stuff is arriving in your mail box, when instead you get a file sent to your email box, with a download for audio and a download for a book. Gurus know that if they didnt show you this huge course layout, that you probably would not buy because, who would pay $600 for 2 downloads.
Ok ill stop ranting it just got me going again.
Thank you for your responses. This thread has been very interesting to read through. Do any other investors out there have anything else to add on this subject? If so we are all very interested to hear from you. :beer
Yes, I agree. It was very interesting reading and some of it I did agree with.
Thanks
:beer
Humpty Bump!
In regards to all of the posts, I think they’re all great. But what I would really like to know is what kind of sacrifices did the people who have made $200k or whatever the amount is have to make? I guess I could be somewhat specific about the sacrifices.
-
What sacrifices did you make to have the time you needed to make it in this business?
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What sacrifices did you make to become disciplined?
and lastly,
- What sacrifices did you make to keep yourself focused on your goal and to remain persistent whenever you faced failure?
Looking forward to all you guy’s responses…
:bobble Its amazing all the answers came through. I placed myself in this position and I don’t think anybody really answered it… Good advice, but no real solid answer… or is there? One came close explaining how to break it down… if you wholesale at average $5000 that would be 40 deals a year average 3.3 a month. Or flipping on average (what I got) $15 grand a house
that would come to about a house and a half a month… Then You break it down what it takes to do this… I would strongly suggest that you hook up with a “good” mentor who specilizes in this or keep asking specific quesions as you develope in one of these areas at this forums or others. I could be a poster child for Robert Allen I got checks on my wall for $35000, 15,000 , $50,000–etc BUT not consistent… This is what I have learned so far… BUILD your Data base of Buyers, sellers and investors --that is where the money is… and the consistency. Also learn to Market. P.S. Does any one have marketing tips like to share? To our success. John sr.
I fell just short of making 200k last year as a wholesaler but I can say that I didnt make alot of sacrifices because sacrifices involve giving up something that you want to do, to do something else.
I did exaclty what I wanted to do and made a good amount of money at it. I don’t do sacrifice because sacrifice can only be done short term before you break. I follow my passion and my passion happens to be wholesaling. I would suggest if wholesaling involves alot of sacrifice for you then don’t do it.
Find what your passionate about and do that, this isn’t your practice life. Don’t be a prostitute to life by giving up your time and energy to do things that you don’t enjoy. I know you need to make a living but always go to work on you, as often as you go to work, in the long run you will be living the life of your dreams. In todays economy you can make money doing just about anything if you put your mind to it.
I have great buyers and I’m not afraid to make some money. I also live in a very lazy city (Los Angeles). I get the deals other people don’t because I go that extra step. I am not scared to go knock on a door or make a phone call.
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I have just ONE question… lol :biggrin
The key to all of this seems to be Marketing. What exactly are you succesful wholesalers doing to generate this type of income?
DaTruth
Is there one method for finding investors you would recommend over another if you lived in an area where the total population in a 400 square mile radius is less then 100,000 people. I ended up investing about 150,000 into my now divorced partner’s pocket and have plenty of motivation to make it back very quickly. :banghead :help
I hope my answer helps…I found a WHOLE bunch of “We Buy Houses” in the Sunday RE section. I am set to call each and every one tomorrow and find out what their criteria is to see who will take my deal…and to build my buyers list.
This isn’t necissarily flipping or wholesaling, but the real-estate agent that helped me find the home I live in now said that he expects this year to be the year that he makes his first $1,000,000. I didn’t ask him whether that was net or gross, and I’m assuming it is probably gross, but knowing the guy, I can quite honestly say that I believe him.
Dean