Imagine going into business, only to realize you weren’t in the business you thought you were in.
David Dodge, author of The Ultimate Guide to Wholesale Real Estate and The BRRRR Method, thought he was going into the real estate business … but it turned out, he was going into the marketing business.
Starting at the ripe old age of 20, Dodge began his real estate investing career the hard way — saving 20% down payments and buying rental properties one at a time. It took him ten years to acquire twelve rentals — barely over one a year.
Hungry to go faster, he started exploring ways a real estate investor could expand quickly without deep pockets or perfect credit. That’s how he found wholesaling.
Real estate wholesaling, for the uninitiated, is the practice of finding motivated sellers, getting their house under contract for below-market value, and then selling the contract to another real estate investor to close the deal.
How do you find sellers who are that motivated? By marketing to find them. And once you find them, focus on solving their problems.
“I’ve bought houses for people that were going to prison next Tuesday, and they needed to sell now and I helped them,” Dodge said. “And they knew they were leaving money on the table, but I got the deal done in hours versus days. That’s the convenience that we provide.”
After four years of wholesaling, he began buying some of the deal himself, rather than wholesaling them to other investors. Using the BRRRR method (Buy, Rehab, Rent, Refinance, Repeat), he is able to put none of his own money into the properties and expand his portfolio exponentially.
Now his marketing machine is on autopilot. He spends maybe $3,000 in marketing to find a deal that pays anywhere from $8,000 to $300,000, while his rental portfolio throws off $20,000 in cash flow every month.
Why does he still wholesale? Because his marketing yields more potential deals than he can handle himself. So, he still sells deals to investors — including those looking for a passive investment to park their self-directed IRA or Solo 401(k) funds.
