Posted on: October 11, 2021
WI 794 | Virtual Wholesaling

 

Some investors may be situated in an area where it is not conducive for their real estate wholesaling business. What would be your best move if you are in the same situation? Do you just quit and give up on your dreams? Well, that’s not the case for Lauren Hardy who has been living in Orange County California, a place where the real estate industry is not that profitable. The system she has set up greatly helped her and her students earn well even being in an unconducive market. Her strategy, vision, and goals have proven that setting up a virtual wholesaling business defies boundaries.

In this episode, Lauren who is an expert in wholesaling houses virtually will be sharing valuable insights related to opportunities for virtual wholesaling. She will be talking about how to escape a competitive and saturated market and how to avoid problems that may arise when you set up your wholesaling business.

What is Virtual Wholesaling and Does It Make Sense for Your Business

I’m going to talk about what you need to know about wholesaling houses virtually. I am an expert at virtual wholesaling. It is all that I do. I’m a volume wholesaler and all of my territories are outside of my backyard. The reason is because I live in Southern California, specifically Orange County, and it is cutthroat here. It is very hard to wholesale houses in my backyard. You might be in a similar situation.

Maybe your backyard is too expensive or too high-priced. The investment model does not make sense in your backyard. It could also be that you live in an area where real estate does not hold much value, so it could be either too expensive or not expensive enough. I am going to go over some of the big things that you need to consider if you are going to consider a virtual wholesaling model.

I am going to explain some of the opportunities that come with virtual wholesaling. I’m going to show you how virtual wholesaling can be done from anywhere. I’m going to share with you how you can escape your competitive, saturated market, but I’m going to also share with you how virtual wholesaling can open up the door to a lot of headaches and problems if you go about it the wrong way. Let’s get into it.

When you learn the virtual model, you have no boundaries. Virtual investing opens up more opportunities for profiting.

Virtual investing can be done from anywhere. I like to say the tagline, “Live anywhere. Invest where you want,” and I believe in this concept. It’s a concept that I grew up with. My father owned properties that were in Ohio when we lived in California. I have been investing in out-of-state properties for the last couple of years, so it is a concept that I very much believe in. I also have a coaching program and I’ve put 350 students through it, so I know that virtual wholesaling can be done. I have students that live in India and Spain. I have tons of students all over the globe who have successfully been wholesaling houses. Isn’t it amazing that you do not have to be tied to where you live?

I personally love living in Orange County, California. It’s amazing. The weather is unbeatable. It’s a beautiful place to live. There’s a ton of stuff to do, but it’s not very easy if we’re talking real estate investments. You have to have a ton of money and the returns don’t make sense. There are places in this country where the returns make way more sense. I want to go where the profit margin is the highest, and it’s not here. Even if I did want to compete in this market, I didn’t come born with a trust fund. It’s super expensive. The average house price here is $850,000, so you really have to have a lot going for you to start flipping or wholesaling houses in an area like where I live.

Does that mean that I give up on all my dreams with real estate investing? No. It just means that I need to look elsewhere, and I know I’m not alone. A lot of people fall into this category. A lot of people get into wholesaling or they hear about wholesaling and they don’t even realize that they are in a market that’s not conducive to wholesaling or real estate investing techniques. They go after it for years, banging their head against the wall and wondering why they are not doing as many deals as their friend who lives in Arizona.

WI 794 | Virtual Wholesaling

Virtual Wholesaling: Work with a local wholesaler who is crushing it and doing deals so you start learning the lay of the land.

 

Believe that it can be done from anywhere and you can invest wherever you want. When you learn the virtual model, you have no boundaries. Virtual investing opens up more opportunities for profiting. What I mean by that is you can utilize different investment techniques that you might not be able to do in your home market. Let’s say that you live in a market that’s very low-priced, and the cashflow is great.

Maybe you get a 2% rent to price ratio where you live, and that’s awesome, but house flipping is not super profitable there because the price of the properties is so low that by the time you remodel and fix them up, you don’t have much profit left. That is a very real scenario, but let’s say you have these dreams of being a high-end house flipper. If you learn the virtual model, you can do that. You can go to, let’s say, the major metro that’s maybe four hours away, and you can successfully flip houses and do that type of investment technique.

Let’s talk about the opposite scenario. Maybe your backyard is pretty good for flipping. The average house price is $450,000, so if you get a good deal, you can dump $60,000 in that property, fix it up like you’re on HGTV, and can make a good profit doing that. That’s great, but what if you want to buy cashflowing rentals? You are going to find that it’s going to get harder to find a property that meets that rent to price ratio you want. Most people want a 1% rent to price ratio, and there’s plenty of places in the country that are 1% or better.

It might mean that your backyard is not necessarily that place, but there’s plenty of places that do meet that model. If you can do it virtually, you can go to those places where you can get that 1% rent to price ratio. What if building houses excites you? What if you hear about a new territory that is emerging? It’s a market that’s emerging because maybe an employer just moved their headquarters there and you want to get into development. If you know how to work these deals virtually, you can do that. I did exactly that.

With virtual wholesaling, you can finally escape the competitive market in your local area. When you feel the heat of competition, consider the options outside of your territory.

When I got into virtual, Nashville was booming. It was insane. I wanted a piece of that, so I took my business to Nashville. I still lived in California, but I was building houses in Nashville, and I was able to participate in that development boom, and it was amazing. It was a great time. I made a ton of money. I wouldn’t have been able to do that if I did not take that leap into going virtual.

One reason I really like virtual and why most people talk about it is because they want to escape their competitive market. Let’s say you were in a market that was pretty good years ago, but as time has gone by, more and more wholesalers have entered the market. Now, it’s super saturated and getting very difficult to get deals. Let’s say that you’re noticing things like your marketing budget is starting to go up, or you have to spend more money in marketing to get that one deal, whereas maybe years ago, you didn’t have to spend that much in marketing. That’s when you start feeling the heat of the competition, and that is when you probably do want to start considering your options outside of your territory.

It could be that you want to go maybe an hour away, you want to go somewhere that’s three hours away, or you want to completely leave and go out of state. That’s where going virtual is going to come in hand and it’s going to allow you to not have to deal with a market that is getting supersaturated. I myself have left markets because there was a point where the amount of competition made it impossible to profit, but now I get that I’m talking about going virtual in a way that it’s all like roses and butterflies. It can be great, and it can be very lucrative. Let’s talk about how virtual can cause some headaches.

Let’s talk about some of the pitfalls of going virtual. What can be difficult about going virtual is you don’t know the area you’re in. You don’t know the lay of the land, and you don’t have a big base of buyers. There are a lot of ways that going virtual can be very difficult because you don’t understand the territory. For example, you might lock up a property or a contract in an area that nobody is buying in, but you think it’s a good deal because you got the contracts 50% off. How are you going to know that that contract is never going to move? That happens a lot when you go virtual at first. Expect that.

WI 794 | Virtual Wholesaling

Virtual Wholesaling: People who go virtual struggle to understand the pricing in a particular area and the buyer’s expectations.

 

I always recommend that you work with a local joint venture partner, somebody local in the area that is successful in the business you’re trying to do. If we’re talking wholesaling here, work with a local wholesaler that is crushing it and doing deals, so you start learning the lay of the land. It can also be hard to comp houses out.

Let’s say you are used to an area where the properties were built in the 1960s and above, so you’re used to construction that’s a little bit newer. You go to a virtual territory where houses were built in the early 1900s. That is going to give you a run for your money. It’s going to take a minute for you to understand the construction. It’s going to take a while for you to understand what you should lock up under contract versus what needs way too much work. Those are the two things that I noticed the most with going virtual, where people struggle and understanding the pricing in the area and the buyer’s expectations.

There are some areas where a buyer will buy something that’s $0.70 on the dollar, and then there are areas where buyers want it $0.50 on the dollar. It takes you having some basic market knowledge for you to understand those differences. That is how going virtual can cause some headaches. A lot of people, when they’re going through those headaches, that’s when they want to turn around and give up. I see that all the time. Usually, when people go virtual without getting any kind of mentorship, a joint venture partner, or both, they usually give up when they face these issues. They’ll get something under contract and they get excited about It, and when they can’t move it, they just give up on the whole virtual concept.

I’m here to tell you that I’ve seen enough people do this, and then I’ve seen people succeed. The difference is they get mentorship. They get a coaching program like mine. They cut their learning curve when it comes to running your business virtually, and they also get a local joint venture partner. That combination seems to be the success formula from what I’ve seen.

That is it. I hope that you learned enough to give you some ideas of what you should know when you go virtually. If you want to learn more about virtual wholesaling and you want to master this, check out my coaching program at www.VirtualInvestingMastery.com. I hope that this answered some questions. Until next time. Thanks for reading.

 

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About Lauren Hardy

WI 794 | Virtual WholesalingLauren Hardy is a Virtual Investing expert and Real Estate influencer who owns multiple companies in the real estate industry including real estate investment, coaching, and software companies. She is also a Wholesaling Inc coach and co-host of the Wholesaling Inc Podcast.

Her experience in the last decade has been focused on real estate investing and creating products and services to serve the real estate investing community. If you are interested in investing in real estate virtually, house flipping, or virtual landlording, Lauren’s your girl.

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