Wholesaling Commercial Real Estate With John Cleare - RET Ep#32
Join John Cleare in this episode of Real Estate Talk as he dives into the world of wholesaling commercial real estate. Learn how to make the transition from residential to commercial wholesaling and discover the key strategies for success in this competitive industry. If you're looking to expand your real estate portfolio, this episode is a must-watch! #wholesalerealestate #commercialrealestate On Episode #32 introduces John M. Cleare, a licensed Broker from Michigan with over 17 years of experience and a remarkable track record of closing 75 deals annually. John is a respected Real Estate Consultant, Influencer, Speaker, and Investor, specializing in both Residential and Commercial closings across the nation. Known for his commitment, rational approach, and strong work ethic, he focuses on helping real estate investors and homeowners achieve profitable outcomes through swift and successful closings. John's mission revolves around affordable housing, empowering families, and individuals to attain the American dream of home ownership. He welcomes correspondence with like-minded individuals passionate about closing deals and creating win-win situations between sellers and investors. 🔹 John M. Cleare, a licensed Broker in Michigan, brings over 17 years of experience and a track record of closing 75 deals annually. Renowned as a Real Estate Consultant, Influencer, Speaker, and Investor, John's expertise extends to both Residential and Commercial closings nationwide. His commitment, rational approach, and strong work ethic have earned him a loyal client base and repeat business. John's primary focus is helping real estate investors and traditional homeowners achieve profitable outcomes through swift and successful closings. With a solution-oriented mindset, he tackles any issues that arise, ensuring a seamless and rapid close. 💡 John's mission centers around transforming lives through affordable housing, empowering families and individuals to embrace the American dream of home ownership. He finds fulfillment in sitting at the closing table, having seen each deal through to its completion, and encourages everyone to live life to the fullest. ☑ Specializing in Commercial investment opportunities, John welcomes correspondence with like minded individuals who share his passion and enthusiasm for closing deals and fostering win-win situations between sellers and investors. 🔹 Contact John at John@CleareToClose.com 🔹 Join our VIP Buyer List: http://eepurl.com/dqLq-5 🔹 Buy | Sell | Invest: https://linktr.ee/Mr_Cleare 📌 For more information, visit CleareToClose.com TITLE: Wholesaling Commercial Real Estate With John Cleare - RET Ep#32 Tools we use These links maybe Affiliate Links: Propstream 7 day Free Trail https://trial.propstreampro.com/mission Batch Leads 7 Day Free Trail http://leads.getbatch.co/mz1ztlA Batch Dialer http://dialer.getbatch.co/mz3qtOo Batch Skip Tracing http://st.getbatch.co/mz3qubj ✅ Subscribe to The Channel Randy Stedwell for valuable insights into wholesaling and Real Estate through interviews and my personal journey: https://www.youtube.com/@randystedwell ✅ Stay Connected With Us. 👉 Website: https://www.randystedwell.com/ 👉 Instagram: https://www.instagram.com/RandyStedwell 👉 Facebook: https://www.facebook.com/groups/metrodetroitoffmarketrealestate/ 👉 Twitter: https://twitter.com/RandyStedwell ✅ For Business Inquiries: RandyBuysHousesMi@gmail.com ☎️ Call Us On: (586) 307-4765 Welcome to our channel, We are here to Teach and learn about wholesaling and Real Estate in general. We are doing that by interviewing others and sharing my experiences with Wholesaling and my future experiences as I go through this Journey. Come follow along with us, and feel free to ask questions. I am an open book. For Collaboration and Business inquiries, please use the contact information below: 📩 Email: RandyBuysHousesMi@gmail.com 🔔 Subscribe to The Channel Randy Stedwell for valuable insights into wholesaling and Real Estate: ================================= #realestate #dealanalysis #propertyinvestment #negotiation #jointventure #realestatetips #wholesaling Disclaimer: We do not accept any liability for any loss or damage which is incurred by you acting or not acting as a result of listening to any of our publications. For all videos on my channel: This information is for general & educational purposes only. Always consult with an attorney, CPA, or financial professional for advice based on your specific situation. Copyright Disclaimer: Under Section 107 of the Copyright Act 1976, allowance is made for "fair use" for purposes such as criticism, comment, news reporting, teaching, scholarship, and research. Fair use is a use permitted by copyright statute that might otherwise be infringing. Non-profit, educational, or personal use tips the balance in favor of fair use © Randy Stedwell.
Hey everyone out there in YouTube L and our Metro Detroit
off-market Real Estate Group hope you're all having a wonderful day man it was a
very nice day out today and I so I can't wait to bring on this I the this very
special guest uh John clear and he is another
wholesaler I I know I'm a wholesaler but I I love healing hearing from other
wholesalers as well and what they're doing because their diff their business is maybe a lot different than my
business uh but but please do uh come join me and listen to his story he has a
lot more experience than I do and he's actually done something that hey I may want to do later on too going from
residential wholesaling to commercial wholesaling I you know I I can't wait
that's the next step so without further Ado let me bring on John John how are
you doing today I'm wonderful Randy thank you for having me that's awesome awesome so we got your name up here it's
called clear to close hash clear to close because your last name to CL yeah
I love it everything's clear to close so so tell me a little bit about how you
got started in real estate how did Real Estate even come on your mind like you
know you're are did you come out the womb knowing about real estate no not at all um everything goes back to my mother
so basically um I go all the way back to college uh I was fortunate enough to have a full scholarship ship to college
actually had one of the best scholarships The Gates Millennium Scholarship where he pay for undergrad grad and PhD and um in my sophomore year
my mother had gave me the book Rich Dad Poor Dad and speak up just a little bit
more so sorry yeah yeah so my mom had like given me the book Rich Dad Poor Dad
and you know so I like devoured that book um okay so it it like wared my mind
in a good way it um had turned upside down everything that I had been taught I had been taught get good grades you know
um I graduated high school Magnum Kum and I had a full scholarship I was planning on becoming an Industrial
Engineer you know and okay the good thing real quick sorry real quick uh can
you look at your microphone it sounds like you're you might be closing like covering it up or
something no okay you sound good now so okay I
don't know yeah all right so yeah sorry go ahead and finish up
yeah so basically uh sophomore year I read the book that Poor Dad it was dope and um I decided to drop out of college
you know and even with a full scholarship this made my mind up a long time ago that I never want to like work
for anybody else want and you know college was great um but it kind of
taught you how to work with somebody else okay I just never was with
that so you went to college and one thing that I I I have this feeling like
everybody's like go to college have that exact same work might you know work mind frame go to college get a good job do it
until you retire and then that's about it you know right the Rich Dad Poor Dad
I've read the same book I understand exactly how you feel um on that and the
entrepreneurial Spirit but one thing that I gotta say and I think you can
agree with me is college one thing that teaches you whether you go and drop out
it doesn't matter you still learn it is how to learn right it te it's not what
you're learning in college it's it teaches you how to learn abely absolutely so now you you can get that
from Community College too you can get that for you don't have to go to a university level and spend a whole bunch of money but right teaching you how to
learn and that that there will help you you know and I'm sure that helped you as
well going forward right it did especially because of the subject matter that I was studying in industrial
engineering which is all about business optimization so how do you do you know
like how do you achieve the maximum results with the you know least amount of input so right I engineered into my
wholesale business make it very easy even before the pandemic I was doing virtual wholesaling even in my own State
Michigan you know so I would rely go properties that I was wholesaling even before the pandemic I think a lot of
people caught on to that during the pandemic because you really didn't have a choice didn't have a choice
yeah I was doing that long okay so what year did you start
wholesaling well I started real estate in 2006 that's actually one my first two
properties um I was living in Atlanta at the time so I quickly atire land that's
that's what got it got me into wholesaling um it was actually a a high
wholesaler who was doing very well for herself and she said hey you can make 10 15K per deal without using your own cash
and credit and I'm like okay this has to be a better way I looked at her stuff their free PDFs I never bought anybody's
por you know but I did learn on bigger pets I'm a big uh you know bigger pet
Advocate you know I've always that information on the Forum and I just kind
of learned the RO from there and so I I bought my first two properties in 2006
started wholesaling in 2006 closing my first apartment deal the next year in
2007 what it kept going with the with the commercial if 2008 didn't happen
so okay but I kept whelling you know single family residential at the time I
was doing like the luxury stuff Community plus stuff you know the juicy stuff with like you know six
figure you know like amounts of equity in it we were doing it nationwide I've been doing Nationwide
pretty much since I first started wholesaling um so even though I was in
Atlanta at the time I was selling deals in Texas and Florida and Arizona Tennessee you know and uh then I had to
ramp things back up after 2018 uh so because a lot of my contacts at the time
they were millionaires on paper but a lot of were underwater you know on their properties so a lot of them went back to
N9 to- fivs um me because I I I wasn't underwater I could keep going right and
that's the beauty of like you know even though you're not buying and holding you get tunk for cash and you can find deals
whether it's a Buy's Market or a Fell's Market deal right so and that's the good thing yeah
like you said it's a good thing about wholesaling you can easily adjust on the Fly versus you're a buying or you're a
fixing flipper there's probably a good three to six month overlap between and
and you're probably losing money you know so yeah so with wholesaling you can
pick up on the market the state of the market pretty fast um based on who's buying what and so on and so forth um
now it's not to say that you know you have to I you know just say okay I'm just
going to do with whatever my buyers say or or do this that you still have to look at where interest rates are going
what you know still look at the news unfortunately so um but so as as you
were going you went through this 2008 crash you went through all that as whole sailing did you ever start um going back
to being landlord because you said you were you started off being entire landlord no no no no no so I kept no I
basically kept wholesaling um undd a long time ago B I don't care what age I
am I'm always going to Hotel it just it's just like a concept that clicked for me a long time ago I know a lot of
people start as bird dogs or wholesalers and then they want to graduate you know to fixing Clippers and buying hoes and
um to me it's not really a graduation you know like I know a lot of guys that lost their shirts fixing and flipping um
it is pretty richy if you're if you don't know what you're doing and um you know I've never lost my shirt whole you
never which is good I mean the most you're going to do losing your shirt
wholesaling is uh you're you're gonna lose either an EMD if you put down the
EMD you know um now unless you try to
hold tail it where you do close on it and then try to that's the only time you're going to lose a significant
amount of money you know so if you do it wrong that is that's if
you do it wrong so um you know so up until like going through the 2008 2009
crash I you know you're still wholesaling you're you're and you're all doing residential at this time right
when did yes I did that one deal in 2017 that was a 40 yes I think that was
a 44 unit in Arlington Texas okay and you know like I spoke about a couple weeks ago like that
assignment fee was like a six figure assignment fee it was like in the deal but we still made out good I
was 22 years old and was working on a deal in another state with a six figure assignment fee so I kind of got cooled
to the to the larger TR cash early on and you know so I got back into
wholesaling apartment buildings in 2015 and okay started back in Michigan
you know that was doing the Cades where all the international investors all they wanted was Detroit all the Hy so I
started wholesaling apartment buildings 2015 2016 you know started in Detroit then I
went out to the suburbs you know yeah Frasier Michigan and other cities
Michigan and I was like okay you know it's time to wrap things up and let's go Nationwide again and my business they're
like what like it's hard enough with these like I said no man up you know so I'm the business
partner that's always forward thinking I'm always pushing for it I never you know like I never like to get
in comfort zone so everybody is comfortable doing direct and D signs and
all like I'm G do something else go to a different Stratosphere because like when I was talking about it
at the time saw opportunity um there were very prominent
Brokers here in Michigan that were closing a lot of commercial deals on
open market there was not one prominent host at the time that was Market
Department [Music] building I I became that person because
I saw the opportunity and I said I'm GNA make this my baby and I just triple
downed on it and you know everyone knows me as the apartment line then I pivoted
last year into hotels and motels and now we're working on the land deal you know
so it's like wow yeah yeah so so that that's awesome that you you went to
commercial in 2015 uh least went back to it you did one deal in ' 07 but and I'm sure that
was like nice and juicy to have that you know so like it's it honestly like my my
biggest assignment fee was in Detroit and it was a $21,000 assignment fee I
was happy to like and and and that's the thing right so let's talk about that for
a minute you know everything is Market specific and Market relative so here in Michigan a lot of buyers you know and
you spoke about this at the group like when I mentioned it if you make 10 grand on the deal you almost have to double
close here in Michigan because these buyers are so cheap they like they just want you to make one two $3,000 I'm like
that's EMD money that's not real money yeah like in other states for example
Texas I close a lot of single families in Texas you know the average assignment fee for a single family house is 25 to
35k in Texas and that's a single that's a single whereas that will be like a
triple or a home run here in Michigan you know so it's just it's just all Market specific and I think that like um
first of all congratulations on that that is a juicy assignment fee especially yeah it was and it was within
my first year too so it was it was awesome I I I had a partner at the time
so I split it with him but it was I I I don't have a partner now so I just do JV
deals one by one so exactly I've learned I've learned from
my mistakes yeah it's funny because you had one of
my previous Partners on your podcast I won't mention the name but um at this point yeah like I like to diversify so I
have like multiple partners with multiple llc's in one basket because you got to
realize Partners you know some may be good at negotiation some may be good at M you know it's very rare that your
partner good at everything so why limit yourself you know
exactly yeah most definitely and that's the thing like I um I should have put
they call it dated before I got married and with within the business
world that is okay so I went straight into a partnership I should have just
done JV deals with them um in the beginning it was good it just
once we got our systems in place it was I was doing all the work so right you
know I I was like all right well you know I I don't want to go into that whole backstory but yeah I the the key
thing is is that you know JV deals like I JV with anybody okay anybody that
comes around if I got a buyer more than likely you know and you you got to sell it like let's JV let's hook it up was
I'm here to make sure we do all do deals together that's kind of My slogan abely and that's another thing I want to speak
about like a lot of Whalers are kind of greedy in this game and I've always been Pro JV always it just it just makes more
sense you know I'm like a worksmanship standpoint and I like dealing with the
buyers I really don't like dealing with the sellers I will if I have to but um
so so I like to have partners that like bring me a deal and that's usually the case yeah when it com to like with my
network I can I can it you know so you know and I'm pretty good with dealing
with the sellers and I'm good with dealing with the buyers to be honest yeah so um the good thing is is that I I
get new people that come in and I I they're like well do you are you
coaching are you doing I go bring me a deal JV with me there you go I'll show
you the way from A to Z you know even if need to lock it up for you you know you
bring me the lead we'll still JV it you know absolutely and you know because people ask me all the time you know do I
have courses and all that first of all I'm like my goal was to never become a guru in real estate and I'm and that
will never ever be my goal so I don't have some expensive course to teach you the best way that you're gonna learn is
just JV with somebody and just learn as you earn you know that's the best experience in my yeah most definitely so
so tell me what's the difference between a residential um wholesale deal versus
commercial and and there's two types of commercial deals okay so we're gonna we'll talk about one uh right now and
then we'll go to the other as well yeah so um commercial is also considered
multifam five units and up okay that's considered commercial then the other
type of commercial is you know uh buildings like uh Office Buildings
hotels uh you got you know um business buildings whatever the case may be the
buildings where you have subways and restaurants and CVS like all those you
know those are leases those are not bought by those companies right yeah
yeah so uh what do you let let's start off
with the multifam commercial so how did you go from I you know like what's the
difference between single family and then the multifam commercial what I realized is that the
only difference is it's just bigger numbers more doors right like I'm just gonna keep it very simple and I realized
like the amount of energy I'm spending locking up this 100 unit apartment building like once you have it locked up
it's pretty much the same amount of energy as a single family it's just more doors and bigger numbers and what
motivated me is back in 2016 I was in the hospital for 6 days because uh then
I was doing 100 plus single family wholesale deals a year and I was pretty much doing it all on my own you know JB
here JB there but for the most part I was doing everything you know negotiating you know doing the paperwork
negotiating with the buyer dealing with the title company marketing the property everything and it got burnt out so I say
it has to be so now my goal is just to close 5 to 10 you know commercial deals
a year year that is pretty much like equivalent to the 100 plus single
families that I was closing um but we still do single family you know I'm still a licensed broker in Michigan so
um I do have like agents up under me so we still deal with retail residential and Commercial and we deal with retail
you know um yeah I said that wrong uh retail residential wholesale residential
and then retail commercial and then wholesale commercial so pretty much the whole bandet we do it all but my main
focus is off Market Commercial so the only difference is yeah like you just have more leas agreements rent rolls uh
profit and law statements right when it comes to apartment buildings um we've been fortunate that a lot of our buyers
haven't asked for like environmental you know surveys and all that um but there
really isn't much different right it's the same negotiation I mean one of the key differences is that seller right
you're dealing with a more sophisticated seller umal mom and pop you're actually dealing
with like a business person that it's pretty Savvy for them to get to that point to be able to own something like
that so you know my rule of thumb has always been just be transparent just
tell them you know and and we'll tell the seller straight up we're not the buyer right we're we're going to
wholesale we're going to get paid from the I think transparency is what allows us to seal the deal because H is in dis
tending to be buyers when you get to that level I mean first of all you know seller is going to
do it through dilig you know they're not gonna let somebody lock
up the 100 unit 20 unit 500 unit whatever apartment building what I think doing some things so you so it does help
for you to have a track record you know and in my case like I had a pretty decent social media you know following
and so have to say is just Google my name you know and the proof is in the
put in you know with all the podcast that I've done just like this you know um that's how I get a lot of my deals um
actually the event that we did a couple weeks ago I actually end up getting a deal from somebody that was in the
audience um that day so that's how I get a lot of my deals from referrals really yeah so so that that's
awesome that most of your deals come from referrals and I you know so how did you
how do you go about um talking to the seller about like Hey we're about to do you're going to do this and then do you
do they see your assignment fee I know on on single family there's a seller
side and there's a buyer side and the buyer sees it but you know the the seller doesn't necessarily need to see
it you know what I mean so with these commercial deals does the seller see it do they care um and then
you know that's one question and then the and same thing with the buyers do the buyers care and then I also do the
uh do you see yourself because they're a more sophisticated seller locking up
more creative deals yeah so that's what you know Gabriella was trying to get me into
she's like no you gotta you know do more creative stuff in the past I haven't done the creative stuff it's either
wholesale or retail right and and that's thing being licensed and really the you
know like what's dope about commercial is that you don't need to be licensed in every state right like with retail like
the rules are much stricter for retail because it's like the general public that you're mostly dealing with but
commercial if you're you know if you're dealing that you know in the commercial space it's it's kind of like you know
cavat in tour you know buyer beware seller beware because you know there
aren't there many safeguards as it is with um residential so you don't need to be licensed and
like that's another benefit to commercial right you don't need to be licensed in any particular state to
wholesale an apartment building in another state right but we're residential you know the laws are kind
of changing where certain States you got to be licensed now you know so in order to wholesale I mean even in Michigan
technically if you be finding more bills and year you're supposed to be licensed right um so the laws are changing but
that's the beautiful thing about commercial it's more money it's less regulation okay so yeah I'd definitely
be interested to see what comes about that and some of the states that have regulated wholesaling does it only apply
to residential or does it apply to multif family commercial pretty much no no it it pretty much only applies to
residential you know um because they're um focused on I guess looking out for
the public interest you know the general public and n out of 10 that's going to be like the average
homeowner yeah so real quick iie from our faceback group so your your your
voice is not very clear I think it keeps going in and out so I I've played with a little bit of the the noise cancellation
or the echo cancellation stuff like that try to bring up your volume but it does go in in and back so just if you can
speak up a little bit or speak a little bit closer to the computer that'd be great [Music]
so all right you say something yeah yeah I was just messing
with the settings okay got it all right I hear you clear right now so yeah
that's good all right but it does it does go in and out so um okay so so what
we're gonna do is um you know what I want to do is you know now that we
talked about the multif family portion what about what's the difference between because I know there's a huge difference
between the residential the multif family commercial and then the um you
know what they call it triple um triple trip net yeah trip net
lease and things like that so tell me how like we had um one guy on here who
did a lot of commercial lending um and so we learned a little
bit Malcolm yep Malcolm Turner um and I do want to get him back on here to help
promote his book as well so he he just created a new book so it's awesome guy
yeah so um but how like how are you underwriting those deals and how are you
getting them as well because I mean you you claim that you're you're getting
them through the network through through just networking with people get to know them things like that how are you
getting those triple net leases as well yeah so actually to go back to your previous question um regarding the
wholesale Fe yeah so we pretty much double close you know most of um so we do have like one
um transactional funer who will fund up to like $6 million um so that pretty much covers a
lot of the apartment deals if you go higher I do have sources that can do that um I used to double close with my
own cash you know then I had an issue with one of the local title companies here in Michigan they actually gave my
funds to another wholesaler so I stopped doing that um you know uh using my own
funds and you know the transactional funders you know typically charge one to 2% um so it's not that bad so we
factored that into our you know like our spread and kind of calculate that beforehand so that we know um regarding
the okay so you fact you factor that into your your spread and and to okay
and then regarding the triple net leases I mean we really haven't gotten to the office space really office space is not
a major focus of us you know like of ours right now or a lot of um investors
that come from like the single family space okay most of my clients besides
referrals were previously single family you know investors that own 20 plus 30
plus single families they sold them all and then they got into apartment building my client shifted with them you
know I was talking to a guy today I remember back in 2015 2016 he told me he
was like John eventually I'm G own over 3,000 doors and now he owns over 6,000
doors you know wow it's it's crazy because they they were one of the top
buyers in Michigan at the time for single family you only had three top buyers they used to yeah and they were
one of them and they owned over aund single families here in Michigan and they pivot like when they did I'm like
okay like you know so when I see Heavy Hitters change their pace pay attention
and I'm okay yeah I'm change with you I'mma adapt you know like always be adaptable to change and um yeah so
that's just one example of you know iner who pivoted from the single family space
to the multi family space they're buying Nationwide as well okay okay well and that's the thing
like multif family is very hard to get right now hard to find hard to you know
and then if you do find them they want these exorbitant amount of numbers that
just don't work right you know so I I always try to like I I don't know what
to like like I can talk to a seller all day long but me talking to a broker who
says oh yeah but you can raise the rents and you can do this and you can do so you're selling me on the fact that I can
do that you want me to pay that price now right well yeah said
no it just doesn't work that way no so and they're like well it's a six cap I
go and if I get a loan on this then it's going to eat my my loan I'm gonna be negative right right the interest
payment is going to be more than the you know the cap so yeah yep so well then
it's just for somebody to park their money that is not a good argument and if you're a broker out there whether you're
commercial whether you're uh you know residential I'm going to tell you this
if you use the argument I'm looking for somebody to just parked their money that is not a
good argument means you don't have a good deal right right yeah actually the guy
that I was talking to earlier um the one that owns over 6,000 doors he said that he hasn't come across a good deal in
over a year in commercial you know I believe it I truly
do believe it yeah so um you know like I'm coming across some of these deals but they're just
overpriced for instance I I saw one on Facebook the other day it was a it was a
10 unit apartment building in Detroit they wanted 400 Grand need and it needed
every single thing done to it the only thing it had going for it was it was
brick yeah and actually the first deal that I closed the first apartment deal that I closed in Michigan was a 10 unit
in Detroit and um we had under contract for 100,000 we end up wholesaling for
140,000 and this was back in 2015 2016 and you know so 40K spread and it was
just and like just all the interest that I got from it I'm like oh we got something here you know like the easiest
40 Grand that we ever made and I'm like okay okay and now it's time to scale up
yeah and multi family buyers I mean they're out there they're easy to find
the buyers are but they the thing is is that they're they're going to run their
numbers and it's not a good deal then they're just not going to buy absolutely
you know you know so the buying pool is smaller than residential the sophistication is a little bit higher
for you know for the most part and it's bigger numbers you know so you really got to know your stuff um I would advise
definitely and residential to get your feet wet um wouldn't advise just jumping
right into Apartments um you know I mean like even if you do it's there's nothing
wrong with that like I have some guys that will inbox me like you know like they saw one of my videos and and they
closed their first apartment deal and these are young guys and they're young 20s and like they inbox me like a copy
of their check and I'm just like wow and he was like yeah man like I saw your video and I would have never thought this was possible it's possible right
but I would say just learn the basics know your Market um if you have the you know like the money uh get coar get coar
because coar even though it's pricey um it's so worth it like as far as comps and just Market data it's kind of like
the Grandaddy of all the other software programs um so I definitely so real so real quick because you were fading in
and out so the program they the the software he said was co-star okay
co-star is very pricey I get that but it's one according to John here it's
100% worth it okay so definitely it's it's like the MLS
for uh MLS data for commercial
properties okay so um so with that like
you're coming across these these how many are you coming across a day a month
like I I mean how many deals are you closing right now so I don't really
count the residential stuff even though we're still closing residential Nationwide like at the end of the year I
only count the commercial so okay you know so last year we closed eight
commercial and um that that was a great year for us you know
because not only did we close apartment buildings but we but we um did hotels
and motels as well so okay that was a new space for us we see that
the demand is there these were like eight fig deals you know over 10 million
and the buyers are still out there you know I mean the buy are still out there so the sky is the limit you know the sky
is definitely the limit and now like you know we have our first land deal well
I've actually closed a land deal earlier but it was it it took
months this one the sell is kind of under the gun um so we're going to try to help her out and sell it quick in
like couple weeks okay so your first land deal and
where's the land deal at is it here in Michigan no so um my first land deal was
in Arizona okay this land deal is in Tennessee got it okay so yeah I you know
I find it funny that um you know people some virtual wholesalers and
nothing against virtual wholesaling but virtual wholesalers who don't know the Detroit
market and who do land flipping and wholesaling land and I saw this one I
saw this on Facebook the other day where it was a Detroit
lot okay it was in between two uh duplexes and and so was I mean okay
location um it was already his own for duplex uh it was already own for two family and they're looking to try to get
like 35k for it and I'm like nobody's really like unless you're
on the coast like on the water you're not really building in Detroit like like brand new builds I
mean you know and if you are
then you're probably only going to pick it up for like five grand maybe less right yeah uh I'm definitely not trying
to do land here in Michigan so now where land I mean there are great spot in the suburbs land like
I I see like in Hazel Park Ferndale like lots get sold and people build right
there because are there well yeah those are yeah the problem is when you have
air yeah the problem is when you have an arv of under 100 Grand you can't build a
house for under 100 Grand right you know unless it's like a tiny
home and you're not gonna put a tiny home you're not gonna cash flow from it you're not gonna nothing like that so
yeah um so where else are are you have you done a lot of deals in Michigan
lately with your commercial stuff or is it mainly out of state um mainly out of state like my number one state right now
that we're wholesaling in is uh Texas Texas man Texas is hot I hear everybody
going there you know yeah Texas definitely hot um it's just it's just so
much land and houses there it's just I mean they're still building new houses you know it's just it's crazy and um the
cost of living is not that bad you know so it's it's a it's a great great state
whole selling most definitely so um I I one thing I like about Texas is there's
no state tax so if you work there there's no state tax and you live there y the
downfall with that is because of that the property taxes are
up they're a little bit higher y High property taxes and the same thing with Florida so if you go on to Florida it's
gonna be the same way property taxes are up and because there's no state tax
right no state income tax so um going throughout these who now are you from
Detroit or did you just pass on through like yeah you up Detroit yeah West Side
yep West Side okay yeah all right what part on the West Side uh six
mile okay yeah nice yeah I grew up in uh
I can't claim east or west side because I grew up in Ferndale at eight mile Woodward okay and you know Woodward's
the dividing point between East and West I'm like well I lived on the East but I went to school on the west
y yeah so so literally I I live five blocks I grew up five blocks off of
Eight Mile in Ferndale um this was before it was the Ferndale you see now
so I graduated in o02 so I'm an old so graduating old too oh
yeah all right there we go y yep so um
and you know so I went there I went to off Ferndale schools there but like I grew up I could they call it the Poor
Side of Ferndale you know so um and like I was there when they had softball City
and the state fair and I used to sneak in there when I was a kid and all that so yeah but I I love Detroit man I do
because I I know it like the back of my hand unfortunately or fortunately so there's a lot of people
that come through and they they ask like you know exorb amount of money like as
far as for deals because they're doing comping the traditional way you know
comping in Detroit is nothing but it's not traditional it's neighborhood by neighborhood block by block and you you
really you really have to ask somebody who knows about Detroit yeah um there there are some places where I can't put
a value on anything because maybe I haven't sold anything in that area or or
anything like that so yeah um or I'm going to be way low because the numbers that I've seen previously that previous
sold it just it's not worth it for an investor so yeah I mean you know so what
do you so what do you think about D you know what do you think about Detroit
commercial versus everywhere else in the country I think it's deal still to be
had because we have so many vacant properties here right and like when I was mainly hos selling in Michigan as
far as commercial I mean I did the tened occupied stuff the value ad stuff um the
pretty stuff and surprisingly I sold a bunch of buildings that were totally
vacant like fire damage I mean it's pretty much sold it all even though the
vacant stuff is harder to sell and the funny thing is a lot of my buyers when
they would buy it no one wanted to do the full Rehab on it so like if I saw it to a guy he made do the roof and then
he's ready to resell it to the next guy then he may do the drywall and all this and then he's ready to sell it to the
next guy so it's very rare that I sold a vacant building and that guy actually
fully rehab the building you know guys are like okay I could just invest a 100
Grand make two 300 Grand just reselling it I'm just gonna do that right got
it yeah and I tell people like if you're going to get into Detroit commercial you're going to have to do probably a
full rehab some things yeah you know so it's just unfortunately that's how it
goes but we need to get them price right and and kind of go from there so uh do
you have a a number a cap number or anything like that that that you go by
for certain areas like how do you figure out because you're working all over the country how do you figure out the right
pricing for all this coar right coar gives you the market data it tells you
like okay the average cap rate in the country is you know 8% right we'll just say that right um or for a target market
because different states have different you know cap rates so when I was focusing on Michigan I knew the magic
number was 10% if I could get over 10% cap I knew it was a deal right yep and
guys that's in New York and Cali where they're happy with three and 4% cap rates if I'm telling them I got a deal
in Michigan for 10 % cap I mean that's just like mind-blowing to them so they were a lot of my buyers you know um when
I started doing commercial a lot of my buyers weren't here in Michigan they were from other states you know um
because of the high you know capitalization ratio that we get here um
but if I'm going to another state let's say I want to Wholesale in Alabama you know first thing I want to do is go to
coar check out the data what's the market trends right and just look at the market trends for like the past six
months to 18 months and um just see like where our property's trading at you know
and if I can get a deal at or above that average trading number then I know that
I have a deal right you know so right if the average Market is trading at 7% I
get a deal in 9% I know it's a deal that's awesome so
if so if you come across all these deals you come across all these deals that
that you can get at a at a decent rate I mean are you the one talking to the seller to try to lock it up or do you
have a team yeah I have a team um never really done the VA thing um all my guys
are like mostly here in Michigan I have one guy out in Tennesse so I have people kind of spread over you know like the US
um but they're all investors they all know how to deal with sellers if I have to I deal with a seller I'm not opposed
to it it's just it's not my cup of tea like I would much rather deal with the buers but you know do what you have to
do um but yeah I definitely have a team and plus since you know by me we a broker I have a whole team of agents
that I could just say call a seller you know so yeah yep so I'm glad that you
brought that up for as far as being an agent So you you're actually your own
broker is that right correct yeah cron yeah so what what made you decide to get
your realtor's license and then eventually become a
broker yeah so it was actually one of my title company reps it was around so I got licensed in 2016 2016 is like a
banner year A lot happened that year um I got my real estate license in 2016 because the title company rep that I was
working with at the time she saw my deal flow and she's like man you're closing a lot of deals you know the laws are
changing in other states I think you should just get license like even if you don't want to do retail which I no
desire to do retail um right 36% just doesn't motivate me it never
had um but she said just go ahead and get licensed and and I'm glad that she
made me do it um and then in 2020 I got license as a broker really because I
just wanted to just separate myself from other wholesalers a lot of wholesalers don't have their broker license so I
like to try to separate myself however I can and um you know like I I was already
an agent for four years in again you need to be an agent for at least 3 years you to get your broker's license I said
hey what the heck you know and the test really wasn't that much more difficult than the agent license that's awesome and then one
thing I I you've already said it once uh on here but I want to reiterate this to
everyone out there is is I I heard him talk at at an event and that's why he's
here today by the way so um thank you for coming on um but when you see
everyone going one way okay and you see the crowd going that way you're you're you're you're tempted
to go with the crowd right you know well from what you said your own words you
look at that and you're like okay I want to go over here because no one's going over there and I want to make money over
here there are multiple different ways to make money in real estate it's not just following the crowd so the fact
that you go off on a tangent like do the opposite of what everyone else is doing
that right there makes you unique absolutely absolutely you know you know
and um word you know like in our um industry word gets around quick you know
word of mouth is everything um like if somebody's out here doing bad business word's gonna get around about them so
you know when I started doing it like people in our Market Michigan were like he's crazy like what what what like you
know like I was talking such crazy numbers at the time it just like oh no that's just not even possible like I was
talking about six figure assignment fees and seven figureure assignment fees people just looking at me like really
because they're thinking about like you know like their Market you got to think bigger than your Market y it's a whole
world out here and um I spoken into existence I talked about it before it actually happened now it's actually
happened and I like doing that I like manifesting you know my destiny so
happen when I want it but I know it's going to happen most definitely if you're going to shoot for the stars then
and and say you only hit the moon you know hey that's okay you shot for the
Stars you know so it it the the biggest thing is is that you don't want to put a
limit on yourself when there are times where I I I see it myself I put on limit
I try to make five gr per deal okay M that's after I'm JV so I shoot for 10
knowing that if I do end up JV with somebody I'm going to split it I at least get
five okay yeah but see that's that's because I do a lot of Detroit deals and a lot of Detroit deals are smaller deals
you know the the price point are 30 grand 35 Grand 40 Grand whatever the
case may be MH well you can't put a you really don't want to limit yourself there either
because my $21,000 wholesale deal was a 30 grand deal what I sold it
for I I got under contract for nine grand you know so you can there are
different ways to go out there it wasn't me trying to my thing was it wasn't me trying to negotiate the heck out of the
seller or earn them I legitimately thought I was going to get beat up by sellers because of what I thought maybe
would have was going to be a foundation issue so I beat them to the
punch no the fact is is that the reason why I had that $21,000 wholesale deal is
because they did not beat me up on that and they're like oh yeah it's nothing okay great hey perfect right all right
that money goes in my pocket you know but that's good that you are critical when it comes to analyzing deals and and
those are the wholesalers that stand out you know instead of the ones making little repair estimates and and
overinflating the arv like I was always very conservative when it comes to the arv I'm using like the low to mid comps
not the high comps and I may overestimate the repairs and that's good
so that's an additional benefit for me and my buyers right like most
definitely yeah so um one thing I want to ask is we're coming up to the end
here how can our audience here help you um moving forward you know um into your
future and what is the future for you as well yeah the future for me um I do want
to step up my residential game so I want to get the residential uh wholesale
assignment fees to six figures per month that's my goal this year um and the
commercial will stay the same 5 to 10 commercial deals a year um so they can help so you're saying doing multiple
residential to add up to six figures not six figures on one deal right right not
six figures on one deal with the residential um getting the residential
wholesale business to six figures per month right okay to match what we're
making on the commercial got it okay and how can we help you get to that point
bring me off Market deals I already have the disposition all right you know just bring me off Market deals and um I will
say that I'm very picky and selective you know about a 100 deals cross my desk
every day I may touch one so I'm very picky I'm going to do my own due diligence I don't want stuff that's on
Facebook Marketplace I don't want stuff that's in any Facebook group on Craigslist it has to be completely off
Market not on lotet not on nowhere I'm going to I'm going to jack right yeah to
be complet that's awesome yeah I when I JV with somebody I I don't like them to
advertise at first right so I want I want to be involved in the beginning if they've already advertised I don't
really want to be involv like I'll give you advice towards it say hey you're a little bit too high you're this you're that but you know sorry it's just
probably not gonna happen um you know so I want to be like the first one you go
to the the the go-to person you you know um you know with that I'm going to tell
you the truth and what I think you know I I'm not going to sugarcoat it and if
you think I am or you you say I'm I I I
well I don't know who's gonna pay that or I've had people say that to me nine out of 10 deals that I look at are not
deals right and I I look at deals Loosely like you know we call every
residential prop I mean you know every property a deal it's not it's just the reality of it every
property is not a deal right every property is's not a deal and one thing I'm seeing is through
some of these buyers now like even with the state of our market right now is
buyers are oh if there's a tenant in the in place for a single family resident so oh I want it vacant I don't want to deal
anything with tenants I'm gonna lose money and I'm like I'm looking because
I've been doing this this is my fourth year doing this yeah I I've seen everything in between and I'm like yeah
you're supposed to knock a little bit off to accommodate for that and I do and
I go I priced it accordingly well no I just don't want to touch it you know I'm like I I get that
but you know I I don't understand how you're an investor you call yourself an
investor if you're not g willing to take some risk you know at least tell me the price where it works for you to take
that risk and that's what I that's all I ask yeah yeah I was F if I can meet that
price or not yeah I was Cash per turn so if it's Ted occupi the first thing is is
it under Market rent or at Market rent a lot of times it gonna be under okay oh yeah the next thing is okay the lease
duration is that tenant month-to month are they on one year lease or what if they're month to month that's gravy
because you know you can raise the rent and if they don't want to do it replace the yeah like I have one right now I
have one right now on the 48235 it's on Heartwell yes it's way under Market rent
it's 700 a month but she's paying it's a month a month okay and it's a great Fix and Flip
area we're asking $499 for it right now um I'm like shoot me an offer you know
see what we can do and I've had like four like there's other investors that
are interested of course but at least foreign invest oh if this was vacant can
you make it vacant a closing can you do that if I were to do it I'd be asking
more right you know I'd be asking at least five grand more if it would be
vacant y yeah I mean arvs are about 150 right now
um but anyways I don't want to get into I'm not here to talk about my deals I'm not here to push I'm here to just give
as much knowledge as possible so um with that being said we we are to the to the
end of the podcast um if anybody has any questions real quick uh put them in the
chat we can answer the questions live here otherwise we can I put them in the
chat if you're watching the replay and you know we'll answer them later on so
um you know what is next for you are you planning on staying in Detroit as far as
staying in the Detroit market and living in Detroit or are you planning on going
still all over the country and traveling yeah my yeah so yeah traveling yeah uh I
love traveling so my goal is to move to Texas later this year and okay I'm still
going to have my brokerage here in Michigan I don't need to be here in Michigan to run my brokerage my agents
they're they're like self-sufficient they don't need any handh holding and those are the type of agents that I'm
looking for um and just dominate the
commercial off-market space and then you know build back up my residential but
not here in Michigan like I to me I've already accomplished everything I wanted to do in Michigan on the residential and
Commercial side no more real goals left in Michigan okay do have outside of me that's
awesome so all right with that why don't you stay on here we'll talk in in just a
few minutes and I'm gonna close this out so hey everyone thank you for joining me
I and thank you for joining us on here um I really do appreciate you guys
coming on here and and watching this you know sorry for the audio do watch the
replay I'll try to fix that that audio in in post if I can we'll see what we
can do um you know but he has some great nuggets uh I think what I'll do is if I
can't fix the audio I will put on captions um so that you can read it on the at least on the replay so do watch
out for the replay um and we'll go from there so without further Ado let's all
do deals together.