- In 2019, Dan Braul’s real estate career turned into $ 400,000 in debt.
- During the pandemic, he decided to try again. He began selling wholesale houses in Rochester, New York.
- Brault shared four ways he’s driving his new company to over $ 160,000 per month.
In 2016 Dan Brault decided to try real estate.
On evenings and weekends, when the medical equipment salesman from Rochester, New York was not at his main job, he started a construction company.
Brault, now 31, enjoyed building custom houses so much that he decided to work full time. It was lucrative – until the 2019 project became disastrous due to a poor construction manager, he said. Brault’s firm ran out of money. He had to fire everyone and close everything. He said he had accumulated about $ 400,000 in debt and returned to sales.
Then, in the spring of 2020, he returned to real estate with a new plan: wholesale. Brault buys properties directly from troubled homeowners and resells them to investors, landlords or fins for a profit.
A little over a year later, the business is booming. Brault told Insider that his company averages about 10 deals a month. With a wholesaler’s fee of about $ 16,000, he says, real estate income is more than $ 160,000 a month, he said. He added that it is difficult to find sellers, but his profit is about 55%, or $ 8,000 in profit per trade.
“I never liked the process that much, but it was low and the profit was really good,” Bro admitted in an interview with Insider. But then he changed his mind. “Maybe there’s a better way to do this,” he said.
Brault, who laid out his updated investment strategy at “More PocketsThis summer’s podcast outlined four key ways he’s been successful in wholesale.
1. Form a pool of regular customers.
Brault and his team are reaching out to homeowners directly, hoping to find those who need to unload their property quickly and easily.
“We will contract to buy their property, but then, before we have to close the houses ourselves, we basically find another buyer, such as an investor, homeowner or flipper, who wants to buy it from us. And they buy it instead, “Brault said.
He added that he has a steady group of buyers to whom he sells about 90% of his deals. These buyers must agree to pay a slightly higher cost than he paid for the wholesale, he said.
For example, according to Brault, his company can buy a property for $ 100,000, but one of their buyers is willing to pay $ 115,000. Brault will sign a new contract with a new buyer to close the property. Then, when the buyer pays $ 115,000, $ 100,000 goes to the original seller and $ 15,000 goes to Brault.
“It’s more or less like a job seeker’s fee,” Bro said of the income he would receive from each transaction. “We help homeowners get rid of distressed properties and help investors find properties.”
2. Find sellers and test them creatively.
Desperate sellers are not always easy to find, so Brault has to find them.
“Lead is the lifeblood of business,” he said. “For us, the leader is the landlord who raised his hand and said, ‘Yes, we would like to sell our property.’ And they are likely out-of-market selling candidates. ”
Two sales representatives and three lead managers help Brault connect with homeowners, review them, and gather information to see if they are suitable for the wholesale process.
The team of third-party cold callers who call and text homeowners are also helping, Brault said, adding that the TV ads they run are a great source of leads. He also sends handwritten letters directly to homeowners, which he says is very effective.
Most homeowners do not need to sell immediately and give up the perceived benefits of publicly listing their property.
“Only 5 to 10% of people are candidates for what we do,” he said.
Because many of the owners looking to sell to the wholesaler are in debt, Bro said there could be warning signs. They may have liens or court orders over their property or difficult family situations. He added that lawyers check every transaction.
“Having competent lawyers plays a huge role,” he said.
3. Build an effective and cost-effective team.
Brault put together a nine-person team (including himself) in just over a year, hiring his first remote assistant from the Philippines during his first four months.
The workforce is now expanded to include a COO and two remote assistants, in addition to Brault, two sales representatives and three senior managers.
The remote workforce available has allowed it to grow rapidly and sustainably.
“Virtual assistants are a huge resource,” Brault said. “A lot of what happens in a real estate investing company doesn’t need to be done in person. The back-end can be done by anyone, anywhere. “
One assistant handles the disposition or sale of property: manages how homes are sold once under a contract with the original seller, sells and negotiates these agreements, and helps build relationships with the buyer. Another assistant is involved in contract preparation, data management and other administrative work.
4. Run an efficient and responsible business.
The key to wholesale is building a business to find deals, Broult said.
“So many people are wrong because they are doing it,” Brault said. “And what most real estate investors don’t have is the knowledge of how to actually build a business.”
The key to running a real estate business is having established systems and formal processes to follow, Brault said. Understanding the metrics and being able to keep records and track transactions are also important to keep your company running smoothly.
“I am really happy with where we are and I look forward to further growth,” he said. “So much has happened so quickly. Who would have thought that we are now? “