Posted on: May 03, 2021

If the previous episode was about working within your area, today is about seeking opportunities in multiple markets. Lauren graces the podcast to give an overview of her experiences in real estate investing.

Using anecdotes, she will present four steps that wholesalers can take when their market is getting too saturated. Stay tuned because Lauren is an example that, with technology, the challenges of closing deals out of state can be overcome.

Key Takeaways

  • Find counties or states that are not wholesaler-trendy
  • Take the time to network with investors in those areas
  • Pull a cash buyers list and look at the transaction details
  • Test your marketing method using a smaller list
  • Experience in the virtual space is an advantage

 

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Episode Transcription

Lauren Hardy:
Hey, what’s up guys? This is Lauren Hardy, and you’re listening to the Wholesaling Inc. Podcast. And I want to talk about the four steps to going virtual when you’re starting to feel like your current market is feeling too saturated. So we’ve all been here … maybe not, we all. But if you have some experience in wholesaling you might have felt this before, where your market is starting to feel really crowded. It’s starting to feel like everybody is getting into this market. You might be noticing that your wholesale fees are smaller than usual. Maybe you’re used to getting 12,000 per deal. And lately all your deals are barely hitting 10,000. These are signs that your fears may be coming true and your market is getting too saturated. So I actually had this exact thing happen to me several times in my career. I have jumped markets a total of three times now. So I can commiserate. I can also share with you what I did and what’s helped me.
Let me get started by introducing who I am, because this might be your first time listening to the Wholesaling Inc. Podcast, or maybe this is the first time you’ve ever heard one with me on it. My name is Lauren Hardy. I live in Southern California, specifically Orange County. It is one of the highest priced markets in the United States. I am a mom of two girls named Reece and Presley; they’re 10 and 7 years old. I’m also a single mom. I got into real estate investing, originally, as a house flipper. So I was flipping houses in my local market. It was awesome. This was like 2012, we were still in a recession, there was still a ton of distressed inventory. It was a completely different market climate than it is today.
At that time, being a house flipper in the OCLA Riverside market was actually not that difficult. I could send some direct mail out and rely on getting my next flip. But as the years went by, I noticed that I would have to send more direct mail out to get that flip. And I noticed that I couldn’t be as aggressive with my offers because my sellers were getting other bids that were higher than what I was able to offer. So I realized that my market was getting more and more saturated. And as time went on, I learned that it might be easier to do this business in another market.
So that’s my virtual journey, that’s where it all began. That was around 2016. At that point, I went to Nashville, Tennessee. And at that point, in Nashville, it wasn’t very saturated. It was still a really, really good time to get into that market. There wasn’t that much competition for what I was doing. We were building new homes. So we were wholesaling lots, we were building houses, ground-up construction. I did some flips there as well, but I definitely did a lot of wholesaling. There were some hedge fund activities, so hedge funds were looking for rentals. It was pretty awesome for a couple of years.
I really left California not looking back, because the money I was making in Nashville was really good. And I didn’t have to try that hard. I didn’t have to spend too much money in marketing dollars to get these deals. So it was awesome, right? But, like anything, it started to get saturated. I started noticing that it would take more indirect mail. You’ve heard this before, right? Took more in direct mail. I had to send more postcards to get that one deal. And that one deal, the profit was shrinking more and more. And it was because other investors were coming into that market. And they really were, I mean, it was pretty crazy. If anybody is familiar with the Nashville real estate boom, it was the number one real estate market at that time.
So here I was again going, “Oh my gosh, my cheese moved again.” Right? If any of you guys have read that book, Who Moved My Cheese? you might know what I’m talking about. But it was a time where I had to adapt to what was going on and I had to pivot. So here I am, again, couple of years later, pivoting again. Going, “Okay, I need to find another market. I got to pack up and find another market to go to.”
So, that led me to Oklahoma. So a lot of you guys know that Oklahoma is one of my virtual markets, but maybe you guys didn’t know, actually, Nashville was the first one I was in. So I’ve had to pivot quite a few times. And Oklahoma is an awesome market. I’m still in it, and I’ve been in it for a few years now. And we’ve gotten pretty well-known in the area. We, I would say, are one of the largest wholesale companies in Oklahoma. We’re both in the major metros, Tulsa in Oklahoma City. I love it. I love Oklahoma.
But in the last year, a lot of things have been going on with Oklahoma that are making me think that I should make sure that not all of my eggs are in one basket. So, here’s what’s going on. Number one, is a market saturation with other wholesalers. There are a lot more wholesalers doing volume than there was when I got into it about three years ago. It’s just a fact, there’s way more people doing it. And they’re utilizing all the same marketing methods that I am. So when we speak with sellers, sellers are saying that they are hearing from other investors as well, and they’re shopping my offer around. And so, there’s that.
There’s also new legislation. So not every state has to go through this, but Oklahoma is going through some legislation, there’s some bills that are likely going to get passed that are going to strongly affect the way I market my properties that I have equitable interest in. I don’t want to dive too deep into that, but it’s similar to like what happened in Ohio many years ago. They are just changing things up, and it’s making it where it’s going to be harder for me to market the contracts I get.
Those two things have made me realize that I don’t want to have all my eggs in Oklahoma’s basket and I need to pivot again. Now I’m not completely moving out of Oklahoma, but I did want another, maybe, one to two markets that I could bounce off of. So that way, if things do slow down there, I have other options.
I want to go into the four steps that I took when I was in this situation. And the end result will blow your mind, because it absolutely blew my mind. So here’s what I started doing. I came up with a few counties that I had interest in. And I made sure, this time, that these counties weren’t overly wholesaler trendy. And what I mean by that is that you’re not hearing a bunch of people are in it.
Now, I actually have the fortunate situation where I am a coach for Wholesaling Inc. so I hear a lot of background data. I have, I think, over 250 students. So I thought of areas where I never heard a student say they were going to go to. It sounds hilarious, but I literally thought, “Where are, maybe, three counties in the United States where you’ve never heard a student say they wanted to go to?” I literally wanted to avoid anywhere that had a ton of competition.
So I wrote those states down. I wrote those counties down. And here is the first thing that I did, I networked with other investors in those areas. So I picked up the phone, I went to Facebook, I kind of saw who was doing deals in that area. Looking on the Facebook Real Estate Investment Association, those groups. A lot of those groups have Facebook pages. I reached out to other investors. I also asked around of people that I knew were in that area. Just ask around, “What are you doing in that market? Let’s get on the phone.” So I got on the phone and networked with several. I think I networked with at least four different investors in those areas. So take time, okay? This is going to be a week where you’re just taking time to network.
You’re going to get a lot of data from those conversations. You are going to ask them questions like, “Well, how many deals are you doing? What’s the deal size? Are you comfortable sharing what your average wholesale fee is? What are your favorite cities?” You could even network with other buyers, landlord buyers, hedge funds, flippers. Ask them about their deals, “How many deals are you buying? Are you able to buy deals off of wholesalers?” So right there, you are going to get a gut feeling about the market once you do this little exercise. So, that’s step one.
The next step I took … it sounds funny, but I stalked other wholesalers in the market on the Facebook groups. So I went to the local Facebook group for the Real Estate Investment Association. So go to Facebook, on the search bar go: Real Estate Investor Association, insert your county or city until you land on one. Almost every major county has a REIA, if not five, so you will find something. I went on those Facebook pages and I just looked at the deals other wholesalers were putting out. And what I wanted to see was that a wholesaler would post a deal and buyers would comment. They would say, “Yes, email me the details,” and they would put their email addresses. That shows me that there’s actual activity there with other buyers.
So I wanted to just see that people are doing deals there, that’s essentially what I’m doing. But the other thing I was doing is looking at their deals, specifically. I wanted to see what the deals look like. So I got on their buyers list and I looked at their advertisements for the deals that they had. So I call that stalking. It sounds creepy. It sounds creepier than it is, but it does give you an idea of what kind of deals that you’re going to be doing. And I think it’s a very important exercise.
So the next thing I did, number three, is I pull a cash buyers list and I actually look at the transaction details. So if you pull a cash buyers list from ListSource, you can do this … I am unsure if you can do it from any other provider. But you can put extra details that don’t normally get exported on that Excel list. If you’re at the checkout page of ListSource … if you guys use ListSource … you go to the checkout page. To the left there is some tab in there that says: add additional information. And you can see there’s a ton of additional information, like square footage, beds and bath, sale price. If they had a lien, who’s the lender. Lots of steps.
So I export as much as I possibly can so I can just see: who’s doing the deals? What kind of deals are they? What prices are they paying? I like to see what’s the average size of the homes and the average age of the homes. It really helps me get comfortable with that market to see that there’s other investors buying in it and what type of activity it is.
So after you’ve done these three steps, you’re feeling pretty good right now. You’re already feeling like, “Okay, I got an idea of what the deals are, and the price points, and the types of homes.”
The fourth step is, I test it. I test it with a smaller list, and I just want to see how it goes. So I will normally pull a vacant list and I’ll run it through our marketing methods. I will do some outbound marketing and I will gauge what the sellers sound like. And this is funny. It’s gut feeling, again. I mean, all this stuff is very gut feeling. But you’ll hear it in the sellers voices. The conversations either going to go, “Oh gosh, I get these all the time. What do you want? What’s your offer?” Or the sellers might be really nice and, just, you might feel that they seem more willing to talk to you for some reason, that they don’t get investors hammering them with postcards and text messages and calls every day.
And I also want to hear this seller’s reception to my offer. So when we make the offer to sellers. Because we don’t just talk to them, I mean, we actually make offers and try to lock up a deal. We hear the seller feedback to our offers. And it is a fact, you go to a higher price market where there’s a ton of competition, the sellers are going to be not as receptive to your offers. Where if you go to an area that there’s not as much competition and maybe the price points a little bit lower, let’s say 200,000 and below, you’re going to hear a different tone out of the seller. And that’s going to help with that gut feeling I keep going back to, you’re going to start feeling like, “This is a great market for me to be in,” or, “You know what? This is no better than what I’m doing here in Oklahoma.”
So I did this exact thing, you guys, I did it. I did all these steps and I went for it. And I did a small list, it had about 3,000 addresses that I was working. Pretty small for me. And I just worked the list and we made a bunch of offers, we talked to sellers. We noticed some things, there were some setbacks. We noticed that it was really hard to comp properties. We weren’t really used to this type of neighborhood, the properties were all very different. We weren’t as experienced with this type of geography. So there were some challenges with coming up with offer pricing, but we just worked through it. We kept making offers, even if we were not super confident in our pricing.
And we actually locked up a few, I would say, three contracts. One, we locked up in an area we learned nobody likes. So, that was not ideal. But we learned something, it was a learning experience. And then the other two were literal home runs of the year. No joke. We have not seen fees like this in our local market where we were, Oklahoma, in a very, very long time. I think, collectively, if I’m not getting this right, both of those contracts together made about $36,000.
And that’s, I mean, for just testing something, it was our first go. To be able to put those under contract and have them sold that quickly was incredible for us. That was that gut feeling, that fact that the thing that happens where you’re like, “Okay, this is my sign that this is the market we need to move to.” So after then, I mean, our whole team was really excited about this new market. I mean, we are definitely going gangbusters. I pulled more lists. I mean, I got fully committed. We started building a buyers list. We went all in.
So, that was it. I mean, four steps I took. And they’re not always going to have that home run result, okay? You might do the test and you’re like, “Ah, man, this … nope, struck out.” This is where you really need experience in being virtual. Because I have the experience, I know what to listen for. I know that by step four, I know what it’s supposed to look like. And if it doesn’t look like that, then I’m out. I also don’t make other mistakes. I mean, there’s so many other mistakes people might make, like with their sales funnel management. So, I’m lucky I have that experience. Not everybody does. So I highly recommend getting some kind of mentor that’s experienced in virtual.
I happen to have a coaching program. I’m not trying to shamelessly plug it, but I’ve helped several people do this exact thing, these exact steps. But if you are really interested in my coaching program, you can check out www.virtualinvestingmastery.com, you’ll find out all the details there. I do recommend getting some help with somebody who’s gone virtual, if this is the first time you’ve ever gone virtual, because you are not going to know what to look out for. By the time you’ve gotten to step four, it might be really unclear to you.
So anyway, I hope that you guys got something out of this. This experience, for us, was very, very exciting. And I keep thinking, I’m so thankful that I have this skill of going virtual, because I’m not stuck in Oklahoma anymore. I could just pick up and leave. And there are several people in Oklahoma going, “Lauren, how do you do it? How do you even do that? I can’t even wrap my head around doing deals that are not in my backyard. How is that even possible?” And it is, it really is. I’m so lucky.
Although I thought this was a curse, I thought that living in Southern California was a curse because I couldn’t do the business that I wanted to do here in my local market. And I thought of it as a curse. But now I look back going, it was such a blessing that I was forced to learn the skill of virtual because now I can pick up and I can leave when a market starts to feel too saturated, or when there’s legislation getting passed that I’m not happy about. It’s really an amazing thing to be able to do that. And that’s why I came up with the coaching program, was so I can teach other people that you’re not stuck in your home market, you’re not stuck in your backyard. You really can live anywhere and invest wherever you want.
So, that’s it guys. I hope that you liked the story. Please feel free to follow me on Instagram, shout out and tell me if you got anything out of this episode. And I will see you guys next time.

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