The competition and activities in real estate wholesaling are becoming saturated. This challenging situation pushed Lauren Hardy to change her game plan and become a virtual wholesaler. She shares why this move is one of the best things she has ever done, even if it meant leaving the competitive market she’s already comfortable with. Lauren shares her virtual wholesaling strategies that allow her to discover opportunities even outside a particular state, how it saves her from long travel times, and how it keeps her tactics fresh at all times.
5 Reasons Why It’s Time To Become A Virtual Wholesaler
The saturation of wholesaling activities and competition in the market she is in is why Lauren Hardy chose to become a wholesaler. She has seen how wholesaling is beginning to grow in different markets again, and she wants to share why becoming a virtual wholesaler is a good choice.
I want to talk about a subject that is very near and dear to my heart, and some people would say I’m an expert at it, and that is virtual wholesaling. The reason I wanted to get into virtual wholesaling is because I’ve noticed around the country, especially in the major metros, it is getting insanely saturated with wholesale activity and competition. I’m hearing it everywhere, “My market is so competitive.” This is most prevalent in the major metros. I thought, “Why don’t I talk about what virtual wholesaling is and how virtual wholesaling changed my life?”
I was in that situation where I was in a very competitive market and I had to go to a less competitive market. It wasn’t easy but it was the best decision I ever made. If you are in that situation where you’re in a very competitive market and you’re feeling like there are wholesalers everywhere, and sellers are hearing or telling you that they are getting these kinds of text messages or calls all the time, and you’re starting to feel like your backyard is not as friendly anymore and you want to move on, I want to talk to you a little bit about the idea of virtual wholesaling. It’s honestly one of the best things I have ever done.
Let’s talk about what I’m going to share with you in this episode. I’m going to go into what wholesaling is in case you are super green, which is awesome. It’s cool. We welcome you here on the show. I also want to go into what does it mean when you go into a virtual market? What is virtual wholesaling? I want to talk to you about when you should go virtual. When does it make sense? I’m going to share that with you in this episode. What if I told you that you don’t have to live in the market that you invest in? What if I told you that you can invest in rentals out of state, or you can wholesale properties out of state. With my virtual wholesaling strategies, you can live anywhere and invest where you want. Let’s get into it.
You don’t have to stay in a competitive market. You can pick up, leave, and find success somewhere else.
What is wholesaling? For those who have not listened to as many podcasts or are super new to the concept of wholesaling, wholesaling is just a jargon term. If you said to an attorney, “I want to be a wholesaler,” they might look at you with a blank stare and have no idea what you’re talking about. It’s actual jargon. What you’re talking about are contract assignments. Contract assignments are prevalent in every industry. It’s not just real estate. What you are doing when you assign your contract is you are assigning your rights and your benefits to that contract to somebody else, and typically you’re doing it for a fee. In real estate, we are essentially assigning our purchase agreement to someone else. We are giving somebody else the rights and benefits to purchasing the property and in return, we get a fee. Here on the show, we cover these topics all day long and we love wholesaling. I love wholesaling.
What is virtual wholesaling? It’s that exact same thing but it’s wholesaling anywhere that isn’t your backyard. Let me give you some examples. It doesn’t just have to be out of state. When I think about when I first went virtual, it wasn’t when I went out of state, even though I didn’t really have that in my mind. I didn’t think I was virtual. When I lived in Orange County, I had such a wide net because deals were so hard to come by, so I had to take a deal wherever I could get it. If that meant Palm Springs or way Northern LA where it would take me two hours to get there, I had to take it. A lot of the work that I did was virtual. I was managing these properties. These were flip houses. I was doing it and utilizing boots on the ground there over the phone, using the internet. I was comping these homes out without seeing them. I was giving offers without seeing the properties. I was doing a lot of virtual work.
If you live in a major Metro, but you are aware that there is a county over, maybe it takes 1 or 2 hours away, but you can’t wrap your head around how you’re going to make this business work in that county, I’m going to tell you that you can. You go virtual. You use some of the strategies that I coach in my coaching program which I’ll go into later. Another example, which is more obvious, is going out of state. More commonly, you hear about people holding rentals out of state. That’s an amazing strategy. If you’re in California, having a rental here makes no sense because the returns are terrible. It’s because the purchase price of the homes here are very expensive and the rents are lower compared to the purchase price, but that is not the case everywhere in the country. Does that mean that because I live in California, I can’t invest or I can’t hold rentals? Absolutely not. It means that I have to go virtual. I have to do this out of state.
I’ve also figured out that you can wholesale virtual. You can flip virtually. I’ve built houses, ground-up construction, virtually. I’ve basically done everything that you can do in your own backyard. I just did it out of state. I was pushed there because I had to but I know a lot of people that also do it for reasons of expansion. That leads me to my next topic. Why do some people go virtual? I want you to read on and see if you resonate with these ideas because I hear this a lot and I’m telling you, if you have any of these issues, I know I can help you. The first one is very obvious. It’s the market is getting too competitive.
This is very prevalent right now, especially in the major metros. I’m going to tell you that I’ve had students that were in major metros. The popular wholesaler, trendy areas. Indianapolis, Phoenix, Atlanta, Oklahoma City, they were in these very trendy metros where you see a lot of wholesalers that had done very well at one point. What happened was they noticed their wholesale fees are starting to get slimmer. They’re seeing wholesalers pop up everywhere. Sellers are giving them responses like, “I get these texts all the time. I get these postcards all the time from you people. It’s like everybody wants my house.” Unfortunately, it seems like the market you’re in is a little bit too saturated if you feel like you’ve heard these things or you felt this way. I’ve had students in my program pick up and go a couple of counties over where it’s still a very viable real estate environment but it’s not as saturated with wholesalers.
They had a ton of success. They saw that their fees were back up. They don’t feel like the market is as competitive. If you resonate with that, you have options. You don’t have to stay in a competitive market. You can pick up and leave and find success somewhere else. That’s exactly what I did. I was in Southern California when I first got into it. It was not as competitive, and as time went on, it got more competitive. I picked up and left and that was the best decision I’ve ever made. Another reason people go virtual is that real estate doesn’t have much value in your town. If you live in a more rural area where real estate doesn’t hold much value, where properties are very inexpensive? Maybe you live where there’s a lot of farmland, tons of land.
Don’t wait and sit around thinking your market will get any better. The longer you wait, the more money you leave sitting on the table.
If you live in that area, you’re going to have a hard time finding a property that has value. It makes sense that you might want to go to the next neighboring area that has better property values, stronger property values, or maybe you want to go to a completely different state. That’s up to you. It doesn’t make any difference at this point because once you’re virtual, you’re virtual. It doesn’t make any difference. That’s another common thing that comes up that I hear. The other reason you might want to go virtual is that property is too expensive and the returns are bad. This comes more into play when you want to grow your rental portfolio one day. Let’s say you are using wholesaling as your gateway to being a landlord and having cashflowing properties, but you look around and you’re like, “None of this property cashflows. How am I ever going to make this work here?” Pick up and go somewhere else. That’s what I did. The pond that I play in, the area that I invest in has amazing rental opportunities. I’m so glad that I didn’t have that limiting belief that I was stuck in my backyard.
Another reason is expansion. This one is my favorite because it’s much more positive. Let’s say you’re killing it. You’re doing great. You love your backyard and it’s awesome but you want to expand. You want to make more money. You want to have a bigger footprint. Virtual wholesaling is going to take you there but if you don’t know what you’re doing, it could get a little tough and it can take your other business down that you’re doing very well. It’s very common where you try to go virtual and then you notice that it takes all your energy and attention, and then you start neglecting the area that you were doing very well in. When you are trying to expand, it’s very important that you are strategic about it, that you get some coaching or mentoring to help you cut that learning curve.
The other reason and this is way more fun. I wish I was in this situation. This is not me but this is some people. It’s this idea where you can live anywhere. You can travel. You can live anywhere and invest where you want. I have students in India and Spain. I have a lot of students in the military. If you are traveling a lot or you have to move around a lot because of another occupation, going virtual is the answer. It’s time for me to story tell because I had a journey in going virtual. I fell into a lot of those topics other than traveling for fun because I am a mom. I’ve got two kids. I’m very stationary. I’ve got to stay in South Cal for a very long time. I’ve got young kids so I’m not going anywhere, but I have taken my business virtual for all the other reasons. I wanted to give you my story about it.
The first thing was I started in Southern California. It wasn’t that hard. It was 2011, so there was still a lot of seller distress. It was pretty easy to get a flip project to work on at that time but California got way expensive. It got very competitive. A lot of people got into the flipping game. A lot of wholesalers started coming in. It started costing a lot in marketing to get that one deal, and that one deal was much less profitable. I was getting stressed out because it started to feel like the pond was drying up. I went virtual. I went to Nashville, Tennessee, then I went to Oklahoma City. The next time after that, I chose to go virtual again to expand. There was an area nearby Oklahoma City. It’s about an hour and a half away. It’s another major metro that had very similar numbers. I thought, “If I can make this area work, why can’t I make the other area and make more money and have more deal opportunities?” I expanded and it worked out very well for me.
Let’s fast forward a few years. Something interesting is going on in my market. There were a couple of things. The first thing is in Oklahoma. There’s some legislation that is going to make it difficult for wholesalers to market the properties that they have under contract. I don’t want to get too into it because I’m not giving legal advice or anything on this show. It’s enough to make me think that I should probably diversify a little bit in my area and not have all my eggs in one state’s basket. Another reason with that area was it was getting very competitive. Back to a major metro that’s very wholesaler trendy, Oklahoma City is a wholesaler trendy area. Anybody who’s reading this from Oklahoma, I’m sure you can agree. Lots of wholesalers have gotten into the markets since I’ve been there. I’ve noticed that the wholesale fees have dropped a bit.
I picked up and I’m still in Oklahoma. I’m not saying I left but I expanded to a completely different state from Oklahoma. It’s something very new for me. It was one of the best decisions I ever made because this area, which I’m not going to announce, is much less competitive. It’s not as well known. It’s not as wholesaler trendy and it’s awesome. In the first six weeks of us marketing there, we ended up tying down around $30,000 in wholesale fees, just in the first six weeks. We pulled one list and we didn’t even work it that hard. With not even knowing the market very well, we dove in and utilized the techniques that I teach in my coaching program, and the techniques that I’ve learned from nine years of doing this business virtually here. It was very easy for me to just pop into another market, see how it was and see how it felt. I fell in love. I love this market. I’m so excited. It was the best decision ever.
I’m in four different markets right now. It’s great that I have been able to expand that way. Honestly, going virtual was my only option. Had I not gone virtual, I wouldn’t be in this business. I’d probably working some corporate full-time job and not be very happy about it. It’s led me to some amazing opportunities. I was able to develop houses in Nashville. Nashville’s going through this huge development boom and I was able to participate in that. If I hear that there’s an opportunity like in the Nashville situation, for example, I’m able to participate in that opportunity. It’s been really good. If this is resonating with you at all, I want to urge you to not wait.
Don’t sit around and think that maybe your market’s going to get any better because we don’t know if it is. The longer you’re waiting, the more money you’re leaving sitting on the table. If you feel like anything struck a nerve in this episode, I want you to schedule a call with my team. They can tell you all about the coaching program and what going virtual will mean for you. Check out www.VirtualInvestingMastery.com. I have a ton of student success stories if you scroll down to the bottom of the page. Thank you so much for reading. I hope that this may have answered some questions. I hope that I was able to resonate and give you some stories that you relate to. Until next time. Thanks for reading.