For anyone curious about the potential of wholesale real estate, today's story is bound to pique your interest. Imagine making $31,000 on a single deal, and then replicating that success multiple times within a year and a half to the point where you can leave your day job. This is the real-life journey of Ben Jensen, who recently closed a substantial deal and shared his insights and strategies with us right from the car in a parking lot, having just sealed the deal.
Ben Jensen's $31,000 Wholesale Deal
Ben's recent transaction was distinct—it involved a two-part deal. The first wholesale fee was around $31,000, and the second part brought in an additional $22,000. Here's a simplified breakdown of how Jensen made $31,000:
- Lead Source: The deal originated from a Google Ad. According to Ben, Google Ads produce hotter leads, making them a valuable investment once you can afford them.
- Contract and Assignment: Ben got the property under contract at $148,000 and assigned it to a buyer at $177,000. This price difference was where he made his money.
The Insights Behind Pay-Per-Click Ads
The efficiency and cost of using Google Ads (PPC). Ben explained:
- In areas like Dallas and Houston, each click costs roughly $150.
- Conversion rates are approximately one deal for every 17-20 clicks, with an expenditure of about $3,000 per closed deal.
Efficient Lead Management
Ben detailed the process that follows once a lead clicks on his ad:
- Leads are directed to a professionally designed landing page where they can fill out a form, showcasing reviews and more.
- This pre-screening helps in gathering quality leads efficiently.
Streamlining the Closing Process
Interestingly, Ben never saw the house in person. He had someone take pictures and managed everything remotely. The seller, living in Dallas, signed the documents via a mobile notary, showcasing a seamless and hassle-free process.
Building a Buyer Network
Having a strong network is crucial for success in wholesaling. Ben shared that he:
- Initially had no buyers.
- Met a key connection at a real estate networking event who specialized in dispositions.
- Partnered with this person, splitting fees—70% for Ben and 30% for his partner—for finding and closing deals.
Consistency and Scaling Up
Ben mentioned that initially, he closed about six to ten deals per month, primarily focusing on foreclosures and driving for dollars. With growing experience, he branched out into other marketing avenues like PPC to scale his operations.
Transition to Wholesaling
Ben's journey started in college and evolved over time. Initially involved in door-to-door sales, he leveraged his skills to excel in real estate. Books like "Rich Dad, Poor Dad" inspired his transition into real estate.
Practical Advice for New Wholesalers
Driving for Dollars vs. Paid Marketing
Comparing his early days of driving for dollars to his current strategy involving paid marketing, Ben highlighted:
- Cost: Driving for dollars involves minimal monetary investment but significant time and effort.
- Efficiency: Paid marketing, while costly, brings in more high-quality leads quickly.
Underwriting Deals
For those just starting, understanding how to underwrite deals is crucial. Ben advises:
- Learn from a mentor.
- Understand market-specific metrics, such as buying properties at 70% of their retail value minus repair costs.
Negotiation Tips
Confidence and strategic pullbacks are essential. Ben noted:
- Don’t appear overly eager.
- Emphasize that your team buys many houses, framing your offer as realistic and serious.
"Most of the houses that come across to us don’t fit our criteria. If it doesn't make sense, we'll point you in another direction."
Reinvestment and Wealth Building
Ben emphasized the importance of reinvesting profits back into the business and buying assets. He's acquired 12 units in the last year through creative financing methods like seller finance with 0% interest rates.
Recommendations for New Investors
For those struggling to get their first deal:
- Embrace the grind—understand it will take time.
- Network aggressively.
- Utilize platforms like Ben's free community on School for resources.
Conclusion
Ben Jensen's story is a testament to what dedication, strategy, and leveraging the right tools can achieve in real estate wholesaling. From making $31,000 deals to scaling up and investing profits wisely, Ben’s journey offers invaluable lessons for both new and seasoned real estate professionals.
"The first deal is going to be the hardest. But once you close it, you have the momentum to keep going."
