How To Find Off Market Properties  – Interview with Kent Clothier

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How To Find Off Market Properties 

In this episode of Founders Club, Oliver talks to President and CEO, Kent Clothier,  about how you can find off market properties.

Technology has made finding off-market properties more straightforward than ever. What used to take weeks of research sifting through public records can no be done in ten minutes or less with the right software!

Kent Clothier is the CEO and President of Real Estate Worldwide, a multifaceted real estate education company.

He built Real Estate Worldwide on the success of earlier platforms such as 1-800-SELL-NOW and Find Cash Buyers Now which revolutionized the real estate investing industry forever. Kent and his amazing team focus on building disruptive systems that push entrepreneurship within the real estate to new levels.

On this episode of Founders Club, Kent who is a serial entrepreneur by nature shares his real estate origin story, discussing his background in the grocery arbitrage business to the process of wholesaling houses. Kent also addresses how how his team came to develop a first-of-its-kind software product that uses data points to generate a list of vacant properties in the US and how they continue to layer data to make information more and more valuable.

Listen in for Kent’s insight on how you can leverage strategies to find off market properties in this episode of Founders Club.

Here is how the interview breaks down:

2:23 Kent’s real estate origin story

11:00 How Kent got into marketing and education

16:31 Kent’s innovative approach to real estate

20:44 The origin of Kent’s real estate software

25:53 The marketing piece of Kent’s software

29:29 How Kent’s software works for multifamily

30:51 kent’s insight on leveraging technology

Listen Here:

How To Find Off Market Properties [Founders Club Ft. Kent Clothier]

Full Transcript:

Oliver:    Out here at Absolution Brewing Company today, looking forward to talking to Kent Clothier about how he’s bought and sold over 5,000 properties. And all the strategies he uses to find off market deals and marry them with all cash buyers. Got a whole list of questions and looking forward to jumping in. Let’s get started.  Sitting here today in Absolution Brewery down by the beach here in La Jolla, in Kent Clothier’s neck of the woods. Very excited to be having him on as a guest today.

Kent Clothier:    Glad to be here

How To Find Off Market Properties

Oliver:    Talking a little bit about his story and how to find great off market properties. Just a little about Kent, he’s the founder of Memphis Invest and Real Estate Worldwide, and has bought and sold over 5,000 properties, and also has 5,000 properties under management. So pretty exciting story. Why don’t we just jump right in to that in terms of how you got started with the whole Memphis Invest thing.

Kent Clothier:    Sure.

Oliver:    How you took that to the next level. Well actually before we get in to that, I gotta give a shout out to the beer, right?

Speaker 3:    You forgot to do that.

Oliver:    So I just blazed right over that.

Speaker 3:    You blazed right over that.

Kent Clothier:  Well let’s talk about the beer.

Oliver:   So as we’re sitting here doing this interview, we’re also going to be enjoying a couple of the beverages here at Absolution. One of the cool things that they do is they do a tribute beer to Jerry Garcia which is called the Grateful Red. And they serve it in these little glasses because it is an 11.3% alcohol beer, so it’s pretty stiff. So we’re gonna sample these. We’ve got the Grateful Red and the Grateful Redemption which is aged in Whiskey barrels. So really cool beers. And then also working on the blonde, and Kent’s got a hefe that he’s working on. So cheers. Looking forward to having a great conversation.

Kent Clothier:    Cheers brother, thank you for having me.

Kent Clothier:    Wow.

Oliver: It’s good right? It goes down smooth for an… 

Kent Clothier:    That’s really good.

Oliver:    For an 11.3%.

Kent Clothier:    That’s dangerous right there.

Oliver:    Yeah.

Kent Clothier:    That is really dangerous.

Oliver:    So we’ll keep them in the little Dixie cups.

Kent Clothier:    They need to serve it just like that. Cause when it comes like this, we’ll never make it through this.

Kent Clothier:    Yeah, little course correction. My father and my brothers and I founded Memphis Invest. But I got started in real estate back in December of 2002 in Broward County, Florida, Fort Lauderdale. I had just gotten out of a arbitrage business, a wholesaling business of groceries. And had been really successful at it, but got a little too big for my britches and kind of got run out of there by my partners at the time. And so, stumbled into real estate, was kind of a victim of those late night infomercials. Went to one of those seminars and kind of put two and two together and realized, what I just been doing in the grocery industry, which was an industry I had been very successful at. I’ve help to build the seventh largest privately held company in the state of Florida, right? So we were doing almost 2 billion dollars a year by the time I was 30.

Oliver:    And that was arbitraging grocery products?

Kent Clothier:    Arbitraging groceries. I would buy a truck of Maxwell’s coffee in one market, I would mark it up, put it on a truck, and go sell it into another market where the manufacturer was selling it much higher.

Oliver:    That’s great.

Kent Clothier:    They were selling the exact same product in two different markets for huge price discrepancies, and I was the, you know, punk kid that would come in there and say, “I can buy it here and sell it there, why don’t I just do that?”

Oliver:    Yeah.

Kent Clothier:    And turned it in to millions and millions and millions of dollars.

Oliver:  And that’s one of those things that most people probably never even heard of, didn’t even realize you could do that.

Kent Clothier:    No, no, I was very fortunate. My father, I grew up in the grocery industry, we owned grocery stores and convenience stores when I was a kid, and we just noticed that this was going on. Back in those days we could see that there was discrepancies in the price and so we got introduced to the opportunity that potentially we could buy it one place, pay all cash for it, right? So took a lot of risk. Throw it on the back of a truck and just ship it to another place and see what’d happen. And man, it just, like I said, it took off. By the time I was 23 we were doing 50 million dollars a year. It was crazy. Basically running a garage sale service. Buying somebody else’s trash and turning it in to cash on the other end, it was nuts. And it still happens today, by the way. Huge industry.

Kent Clothier:    But anyway, I got out of that business, stumbled into real estate, and figured out that what I had been doing before, I could be doing over here. Wholesaling houses. I never knew that wholesaling houses even existed.

Oliver:    Okay. So you were actually looking to apply the same concepts, the arbitrage concept.

Kent Clothier:    I wasn’t looking to do it. I was looking to not be broke is what happened right?

Oliver:  Yeah okay.

Kent Clothier:    I left the grocery industry and I left there, like I said, kind of in a huff. My business partners and I had a run in and I was 30 years old just full, you know, you know what, and just thought I knew everything and walked out of there one day. It took me a couple years to realize I didn’t know anywhere near as much as I thought I did. And pretty much lost everything. Lost millions of dollars, was just nowhere near as smart a business guy as I thought that I was. And it took me getting humbled to figure that out because, putting everything in context from the time I was 17 until I was 30, like I said, I helped build a 1.8 billion dollar a year business. Everything I had done had turned to gold.

Oliver:   Yeah. You’re feeling pretty good.

Kent Clothier:    And so I didn’t know what failure, I had no idea what failure felt like at all. And so I just thought that, you know, I was gonna go out there and just rock it. And over a course of two years I figured out real quick I wasn’t that smart. And so I got humbled, got knocked down, lost a lot of money, got taught a lot of lessons, and ultimately ended up, like I said, at a place where I was just humiliated enough to listen to one of those infomercials.

Oliver:    Infomercials, yep.

Kent Clothier:    Go down there, make the trip, and was smart enough, and bold enough, quite frankly to make that investment. Because it was pretty scary, I’m not gonna lie. I mean, I, after losing as much money as I had lost over two years, even a thousand dollars sounded like a lot of money. But I did it.

Oliver:  And most people won’t, they won’t make that move.

Kent Clothier:    Oh, no. Well not only will they not make the move, but then when they make the move, whatever they just invested in, will sit on a shelf and they’ll never do anything with it. And I was just broke enough, just in bad enough situation, just desperate enough if you will, that I was like, “I’m gonna do this.” And within probably 90 days I’d figured out that this is what I needed to be doing. I can make money quickly. My business sense, if you will, kind of kicked in. And in the first year I flipped 90 houses, made a million dollars, and I was like, “I got this. I’m gone.”

Oliver:    Yeah.

Kent Clothier:    Right? And I started doing it. My father was doing it up in Memphis, I was doing it in Florida, my other brother was doing it, Chris was doing it in Colorado. We were all having a lot of success at it. But all doing it very independently. Memphis Invest did not exist at this point. And then as the market turned during the Great Recession, if you will, you know I was down in… If you’ve ever seen the movies where the, The Big Short, and I was in the heart of that. Where the guys goes down and the stripper owns five houses, and that was, I mean, that was our life, right? Money was free. And so we were buying houses like crazy, we were flipping houses so fast. I mean, I’d buy a house and put a sign in the yard. Literally do nothing to it, and make $50,000 in two weeks.

Oliver:   Wow.

Kent Clothier:    It was nuts, just crazy. And so the point being is that it was highly erratic, highly chaotic. And so when you’re, I had a lot of investors that were buying a lot of houses from me. Dealing with a lot of people that had a lot of cash. I’d figured out a way to systematize this thing and really get it going. The problem was, is that when the market collapsed everybody got scared to death. As they should. And so, what’s interesting is when everybody’s scared, something like Memphis, Tennessee which is just slow and steady cash flow. Where you’re buying these houses for 100 grand, making a nice little 8-12% profit every year and you don’t have to do anything, that looks pretty sexy.

Oliver:   Yeah.

Kent Clothier:    And so I started bringing my buyers into Memphis. My brother started bringing his buyers into Memphis. My dad was sitting there basically building this company, Memphis Invest, that was servicing all these buyers. And through a lot of trial and tribulation, ups and down, and you know as the saying goes, you do it wrong enough long enough you’ll figure it out. We started figuring out how to take out of state buyers and provide them a really good asset based out of Memphis, Tennessee. Cash flowing asset. And take care of all the…

Oliver: 100% turnkey.

Kent Clothier:    100% turnkey. I mean turnkey wasn’t even a term when we started this, right? You hear turnkey now, but back then turnkey wasn’t even… that term did not even exist. And now, like you said, 5,000 houses later, 5,000 properties under management, seven cities. I mean it’s just kind of turned into a massive business at this point. But it all started, very humble beginnings. Everybody’s just trying to flip houses and make a living and figure out how to make lemonade out of lemons, right? When all your customers are running for the door, how can we figure out how to keep servicing them? That’s what we did.

Oliver:   And just stacked em up?

Kent Clothier:    Yeah. I mean we had the buyers, there were plenty of people sitting in Florida that had cash and they wanted to buy. They just didn’t want to buy in Florida.

Oliver:   Right.

Kent Clothier:    Because it was too crazy. The market was collapsing. And Memphis was one of those few markets, Memphis and Dallas and a few others, that really did not experience… 

Oliver:   Never really goes up, never really goes down.

Kent Clothier:    Yeah. I mean it’s just not that sexy. It just sits there and putters along, but again, when you’re looking for stability, when you’re looking for security, when you’re looking for a healthy return on investment year after year after year, that really lent itself nicely to that situation. And that’s how it began and now it’s just turned into where we clearly understand that this is what it is, right? Good market or bad market, this is where, if you want cash flow, this is where you wanna be. Just invest in cash flow markets.

Oliver:   Cool.

Kent Clothier:    But that’s how it started.

Oliver:   I love that. And so, what is it that you’re doing now that you’re excited about? Transitioning from Memphis Invest was 1 800 Sell Now and find cash buyers now and I think that’s one thing that I think people will get a lot of value out of, is just the ways that you’ve gone and been able to find off market properties.

Kent Clothier:    Yeah.

Oliver:  And then also, marry them with people that have cash that are ready to buy. So you’ve been able to generate a lot of transactions even in markets that aren’t necessarily hot or cold.

Kent Clothier:    Right. Well what happened was, you know, back to the way that the company kind of came together. When I started wholesaling down in south Florida, finding the deals, because again, anybody could put a sign in the yard and they would get multiple offers, I mean, virtually overnight, so competition was out of control, this was that white hot market. And so the only way I could get to come, I had to come up with a competitive advantage. And so I started 1 800 Sell Now as a way to be memorable, just to stand out, and the immediate challenge and/or opportunity that presented itself was that I was in one market. But that vanity number worked in every market.

Oliver:   Right.

Kent Clothier:    And so not only was I using it in my market, but I quickly realized that there was a business by licensing that brand, if you will, in any market and making the automated systems work. So that in and of itself became and opportunity. And then quickly, before I knew it, I was getting kind of pulled into this side of the business, call it the marketing, the education, the more services side of the business versus the actual investing. And I realized that I was pretty passionate about that, and very passionate about it now, but at the time I was a little passionate. What I’ve found that there’s a lot of people out there in the world, whether it’s real estate or otherwise, that they wanna be entrepreneurs. You know this.

Oliver:   Yep.

Kent Clothier:    And then for one reason or another, they have these obstacles that are in front of them that seem insurmountable, it’s very challenging for them to get through it. And so I became really passionate about, “Man if I can just make it easier for people to get and become successful, then that’s pretty cool. I like that.”

Oliver:   To do their first transaction.

Kent Clothier:    To do their first transaction. 

Oliver:   Get their feet wet.

Kent Clothier:    To make their first 100 grand. To be able to walk away from the job. To get their spouse in their corner saying, “Man, good for you.” I mean that’s just a cool thing to be a part of. And so, 1 800 Sell Now was kind of my first venture into that. What quickly developed after that is that when the market collapsed, as I was telling you the story earlier with Memphis Invest, one of the things that presented itself is at the time we really had a choice. We could go out of business like everybody else, or we could focus on people that didn’t need the one thing that was no longer available, which was banks. The banks were going, I mean the banks were done, they were not lending anymore, right? That’s what got us all in trouble.

Kent Clothier:    And so, call it just you know being obvious about the situation, whatever you will, but I quickly figured out that I needed to focus on people that had cash. And the  only way I knew how to do that was to go down to the county clerks office and look at every real estate, every deed that had transferred the week before, which I could easily go and get down in Broward County. And then I would immediately look, and this is all a manual process by the way. There was nothing automated when I was doing this.

Oliver:    So you were going to the county?

Kent Clothier:    I was physically going down there, sitting in a dark cubicle with a bunch of contractors and people that were trying to file for their permits, right, and I’m going through a ledger and looking, here’s every transaction that happened and was there a mortgage, prom note, recorded against it? Was their a lien? Because if there wasn’t…

Oliver:  Cash sale.

Kent Clothier:    It would have had to been cash. And I would record all this, and I would take it back to the office, and I would put it into a spreadsheet, and I would have my assistant at the time, we had a form letter. Microsoft Word, we’d merge it together, we’d mail that letter, basically send it off to a cash buyer and say, “I know you paid cash for this property and I can help you find more. I wanna sell you my properties.” And before you knew it, I had built a massive cash buyer list. Nobody knew what we were doing.

Oliver:   Wow.

Kent Clothier:    Everybody else, like I said, was shutting down, and we’re over here, and our business at that time, you know Memphis Invest in particular, I mean we went from a couple hundred transactions a year to 300 transactions a year, to 450 to 500 right through the recession. And the reason that happened is we were focused on people that had money. And so it became, when I started doing that, people started looking at me like, “I don’t get it.”

Oliver:    “How are you doing all these deals?”

Kent Clothier:    “How are you doing… we’re trying to survive and your business is growing by 50%, 100%. How’s that happen?” Basically, there was a massive need in the market, the choice was there were a lot of people that were gonna go out of business, or we could show them how to survive and thrive by going and focusing on people that had money.

Oliver:    Yeah.

Kent Clothier:    Cause there were plenty of them.

Oliver:  Right.

Kent Clothier:    40-50% of the market was cash buyers back then.

Oliver:    So is just wanna make sure that everybody’s picking that up, cause I think that’s a huge tip. And it would work in virtually any market, is go in, analyze the close, close sales, and we’re gonna talk about your software that’s gonna help automate all that. But find all the close sales, analyze which ones do not have a loan on them, those are the cash sales. Then go contact those owners and say, “Hey I’ve got similar properties that match the one that you just bought. Are you interested?”

Kent Clothier:    That’s it.

Oliver:   And then you’re building a list of cash buyers that are basically…

Kent Clothier:    And it’s effectively what I had done in the grocery industry, right? So this was not some new epiphany we had, right? You know, when I, I’ll give you an example of this. When I was in Memphis, Tennessee, as I said, my father and I built this grocery company, and we were roughly doing 100 million dollars a year, and then we had a competitor come in and buy our company. And I was 26 years old. And I’ll never forget this, our much larger competitor out of Boca Raton, Florida, came in and bought our company and basically said, “We want you to come run our 800 million dollar a year company.” And I’m 26 years old 

Oliver:   To you?

Kent Clothier:    Yeah.

Oliver:    Okay.

Kent Clothier:    I don’t know the first thing about running a company. I mean I thought I did, but either way, and what they liked was that my approach to the business, my approach to the transaction as very different than anybody else’s. What seemed really obvious to me was not obvious to everybody else. People got so entrenched in doing the transaction a very specific way that I was just young and dumb and stupid enough and naive enough to say, “Why?”.

Oliver:   And you saw a different angle.

Kent Clothier:    And so I basically came in and said, “Why don’t we just go to every buyer we’re selling product to and ask them what they wanna buy. And how much of it they wanna buy. And what price do they wanna pay. And when do they wanna deliver it.” And so, fast forward a few years, in the real estate business, I’m doing the exact same thing. I just went to all the pent up demand and said, “What do you wanna buy.”

Oliver:   Yeah.

Kent Clothier:    “I know you got the cash.”

Oliver:  Yeah.

Kent Clothier:    “How much do you wanna buy? What price do you wanna pay? What neighborhoods do you wanna buy them in? When do you wanna close? How many can you buy?” And life got infinitely easier when I was effectively going and creating inventory that I ultimately knew, if I chose to, I could sell to them. Versus me going and trying to acquire properties and hope that I had the right deal at the right price.

Oliver:    That you could sell it. Right.

Kent Clothier:    Right. I was just playing it differently.

Oliver:   That’s crazy. It’s really smart.

Kent Clothier:    But it’s really obvious, right?

Oliver:  Yeah.

Kent Clothier:    When you say it now, it’s like, “Oh yeah, get it.” But back then people were like, “Wow, I’ve never heard of such a thing.” You’d thought I’d, you know, come up with electricity, right? It was just crazy, but it was just really obvious to me, why would we not go to our customers? Why would I not go to 50% of the market that have cash and just ask them what they want. And so that’s what we did.

Oliver:    I love that. And then, so that was find cash buyers now.

Kent Clothier:    Well, what happened from that, is we took that, we automated it, and then we made a decision, we were gonna go sell it.

Oliver:   Got it.

Kent Clothier:    And that was really scary because if you think about it, I was selling it to all my competitors.

Oliver:    Right. Now it’s wide open.

Kent Clothier:    Now it’s wide open, baby. You’re right there in Memphis, Tennessee, right there in Broward County, Florida, right there in Denver, Colorado, all the places we operated. I’m gonna show you exactly how I do what I do. I’m gonna train ya on it, and then I’m gonna actually give you the data, and by the way I’m gonna give you the marketing pieces I use, and I’m going to let you hit a button and it’s all gonna happen for you. That’s pretty scary stuff, but it was an amazing lesson in that for me. Because it would have been really easy for us to say, “No.” And stay back, and say, “We’re not gonna give this to the world.” And we went after it from an abundance mentality and we learned that there was more out there than we could ever get to, and our business has grown infinitely larger by doing that. So, did not hurt us, it only helped us.

Oliver:  That transitioned to finding the motivated sellers.

Kent Clothier:    Correct.

Oliver:    Right? So tell me a little bit about how you did that cause I know a lot of people are interested in getting off market property.

Kent Clothier:    Yeah. So what happened was, we figured out, well if you think about it, right after cash buyers we figured out how to do this exact same thing with private lenders. And the reason we were able to do that is because they’re all a matter of public record. They’re different degrees of challenging. Cash buyers is fairly straight forward, as we’ve gone.

Oliver:   Yeah, yeah.

Kent Clothier:    Private lenders is a little more difficult cause I actually have to find somebody that’s acting like the bank privately. Right?

Oliver:    Yeah.

Kent Clothier:    So I have to search through certain key words inside of every record and you know there’s a hundred million real estate transactions out there right, so that wasn’t easy. But there is no database, or there certainly wasn’t back then, where I could easily go off and say, “Show me every property that’s currently sitting vacant, that has high equity, that the owner’s in financial distress, and the owner’s over the age of 55” None of that existed, right. But back in 2012 we still had not been able to figure this part of it out. I had the buyers, I had the money, but I couldn’t provide any real service to anybody on off market deals. And interestingly enough, a kid that walked in my office, a guy by the name of Chris Richter.

Oliver:   Shout out to Chris Richter.

Kent Clothier:    Shout out to Chris Richter. Great guy. Picked up the phone, called me, and asked me if he could do a private consultation for me for the day. Sent me 15 grand, flew down from Seattle to spend the day with me, and I think I’m going to be helping him with his business. And he basically walked in my house in La Jolla and said, “So for 15 grand I can talk to you about anything.” I said, “Absolutely.” And he pitched me.

Oliver:  Great, I love that.

Kent Clothier:    Paid me to pitch me.

Oliver:   So you thought you were going to be consulting or coaching him on something, and he came in with a pitch.

Kent Clothier:    I thought I was going to be consulting him on his real estate business.

Oliver:    Brilliant.

Kent Clothier:    And he basically pitched me. And he walked in and walked me through, this is a guy saying, a legitimately ex-rocket scientist, NASA engineer, he worked for JPL. Really, really brilliant guy. Loves data, loves all the hidden idiosyncrasies of dealing with huge amounts of data, and he walked in there and was like, “I’ve cracked the code. I can show you how a property is vacant in Washington by looking at all these different data points.” And so he’s walking me through all these different spreadsheets and his algorithm on how he’s done it, and by God he had done it. And so we put a deal together and we took his formula, his algorithm, and we incorporated across the entire US. We tested it for several months, and before we knew it, we had figured out how to find every vacant property in the United States without ever leaving our house, to a 90% certainty. And people were absolutely blown away by it. And so, we went off and brought it to the market and tens of thousands of people purchased this piece of software and were easily able to find vacant properties without ever leaving their house.

Oliver:   And then they would market to those properties.

How To  Find Off Market Properties

Kent Clothier:    They market to them. They hit a button, send a letter, send a postcard. Phone would ring, they’d never have to leave their house. And so it changed the industry forever. Quickly thereafter, a lot of people came back, a lot of the big data companies came back behind us and, you know, me too, me too, me too, which always happens, which is fine, that’s how you know you’re doing something worthwhile is when everybody rips it off. And so, now it’s interesting because if you were to step into the industry today, finding vacant properties online, or finding cash buyers online, or finding private lenders online has become a fairly, I don’t wanna call it routine, but it’s definitely more straight forward than its ever been.

Oliver:    Right, for sure.

Kent Clothier:    And it’s really nice to know that we were at the forefront of all that. I mean, we created all, from the ground up and a lot of people came behind us and said, “That’s a great idea.” Then we started figuring out that we could layer data to make it a lot more valuable. So now, you know in our software today, you can walk in, you can go in there in a matter of five minutes say, “Show me every vacant property in any city where the owner is over the age of 55, they’re financial distressed, they live out of state, and they have 35% equity, right.” And create that list in five minutes.

Oliver:  So the software will data stack all that stuff in there?

Kent Clothier:    All that. And it will give you a complete overlay right over a map and say here’s where all the properties are, and you can click there and say, “I wanna market to those, those, those, those, those.” And then select the marketing piece and it’s all out the door.

Oliver:  Done for you.

Kent Clothier:    So, in no less than ten minutes all of that research would have easily taken you weeks driving up and down the street trying to find vacant properties.

Oliver:   Right.

Kent Clothier:    Or going to the courthouse trying to find cash buyers.

Oliver:   Take me through what that looks like. Let’s say I’m either an investor or I’m an agent and I’m looking for deals. Excuse me. I find these vacant homes, right, based on my criteria, whatever it is. And then what happens? What’s the next step to turn that into business?

Kent Clothier:    All of our marketing pieces that we currently use inside of our current, active investing business, are baked into the system. In addition to our direct mail partners, who we’ve literally mailed tens of millions of pieces and have split test after split test. All of those pieces are in there, basically saying the number one version, the highest rated version, is the piece that is getting the highest response rate.

Oliver:  Okay.

Kent Clothier:    And you can pick whether…

Oliver:   So they can see your actual numbers?

Kent Clothier:    They can see it. Either I want to market as an investor, I wanna market as a real estate agent, I wanna market as a mortgage broker. Whatever category you’re, the positioning of the marketing piece is all different. So if you’re looking for listings, the marketing piece you’re gonna send an off marketer is, “Hey, I understand your property at 1234 Main Street is currently vacant. I happen to represent a lot of properties in the area, I’d love to come out and take a look, and get ya a fair offer.” I mean it’s very straight forward, right. There’s nothing revolutionary about it in the sense that real estate agents and/or investors, we all understand what marketing is. What’s revolutionary is that you’re speaking directly to their motivation.

Oliver:  Right.

Kent Clothier:    Right?

Oliver:  You’re hitting the hot button.

Kent Clothier:    When you say, “I know the property is vacant, I know the property is probably costing you money, and I can solve that problem quickly.” That’s a little different. Versus, “I represent every house in the neighborhood.”

Oliver:  Or look at this other house over here. 

Kent Clothier:    Look at the bench add I have, you’ve probably seen my face on that. That’s very different. And any of those little nuances matter, as you know all too well, I mean all the agents you work with. I mean, the nuances in marketing, the repetition in marketing, the strength of the list, all that stuff, that stacking there, really, really matters.

Oliver:    That stacking does really, really matter. And I wanna share something that you shared at closing table that I thought was really awesome. Where I think it was probably a combination of both of these things, but basically, if you’re focusing on a farm or a neighborhood, you should run the campaign to find any cash buyers that are interested in that area and the surrounding area. And then run the other campaign to try to find those vacant properties, those distressed properties.

Kent Clothier:    Absolutely. Me in particular, I just don’t like wasting time. And I like doing whatever I can to stack the deck in my favor. So if I have actually taken one extra step and I clearly understand who’s paying cash in that neighborhood, and I clearly understand the price they’re paying, and I clearly understand, I’ve nurtured those people and I understand what’s going on, it just makes me much more confident and that comes through when I’m presenting. If I can walk in front of somebody and say, “I clearly know what price I can pay you.” Because I ultimately in the back of my mind I know, “Hey, I’m pretty sure I can flip this at whatever the other price is.” It just changes the game.

Oliver:   Yeah.

Kent Clothier:    And again, I’m all about those little nuances. There’s so many people that walk into this business and think it’s chance, and it just doesn’t have to be. There’s so much information out there where it doesn’t have to be chance.

Oliver:   And obviously there’s ways to do this, the manual way, and I’ve done it the manual way, and you’ve done it the manual way.

Kent Clothier:    Totally.

Oliver:  And it’s brutal but you can still do it that way, but I would highly recommend Kent’s software.

Oliver:   So does the software also work for multifamily?

Kent Clothier:    It does. It does.

Oliver:   So if, let’s say, someone wanted to target New Mexico, Albuquerque, and find sellers of multi family. How would that work?

Kent Clothier:    Same way, there’s a flag right in there. You can select commercial or residential, and you can select the number of units. So, if you wanna just look at properties that have four or more units, commercial in New Mexico, you select that flag. The way it is ganging vacancy is it’s looking at whether 50% of the building is vacant or not.

Oliver:   Oh that’s good.

Kent Clothier:    So if you use the vacancy flag on a commercial building, it can get pretty hairy pretty quick because for a building to be 50% or more vacant 

Oliver:    They’re losing money, guarantee.

Kent Clothier:    I mean that’s a bad deal, right. Someone’s highly motivated there. But if you un check that vacancy flag and just say, “Show me properties that are four or more units commercial in New Mexico that have 50% or more equity.” It’s gonna look at the debt on that. All day long you can do that right in the software.

Oliver:   That’s great. Love it.

Kent Clothier:    And make it super simple for ya

Oliver:    I love how the way you’ve just made it easy.

Kent Clothier:    Well again, it’s all about time right?

Oliver:  Yeah.

Kent Clothier:    I mean, I would be highly remiss if I did not say that I’m very… The system is designed for me first.

Oliver:   Yeah.

Kent Clothier:    That’s what it’s designed, right? I mean it’s design…

Oliver:  Which is great cause then you know what you want and  you build it the way you want it.

Kent Clothier:    Yeah, I just don’t want to spend a lot of time on all of the superfluous nonsense. I mean, here’s where people get caught up. I’ll share this with ya. The beauty of this business is you only have to be right a handful of times to make a lot of money. So, I’ll give you an example. So if you go and mail a thousand pieces, if you get a 1% response rate on direct mail, you are freaking killing it, right?

Oliver:    Yeah, you’re killing it.

Kent Clothier:    If you get a 2 or 3% response rate, they’re writing books about you, easily, right.

Oliver:    You’re the guru.

Kent Clothier:    You’re the guru. And so the point is, if when I mail a thousand pieces, I’m expecting ten responses. And so 99% of the time I’m allowed to be wrong. And so when the deck is stacked that far against me, then why would I spend the time driving up and down the street and researching all these properties? Why would I spend any time doing any of that because 99% of the time it doesn’t matter. I only need it to be right once, 1%. And so what I figured out, whether it’s vacant or cash buyers or whatever, it’s, give me my thousand, mail them, yes, there’s gonna be a percent that, you know, vacancy for sure, somebody moves into the property tomorrow. Or somebody just moved out, yeah I mean the status is changing. I don’t care. Because one thing is true, is that the ten that I need to call are gonna call and that’s all I care about. So the 990, whatever their status is, I just simply don’t care. And if because of that, why would I spend all of that time doing stuff that in the end 99% of it was never gonna matter anyway. I would just rather mail, spend a few bucks, and just pick off…

Oliver:    Short cut your way to the 1%.

Kent Clothier:    Pick off the 1% that does matter cause those are the only people that are gonna raise their hand and say, “I’m in.”

Oliver:   Right.

Kent Clothier:    And just spend my time doing what I really wanna be doing, which sure as heck is not driving up and down the street looking for vacant properties. How do I get there as fast as I can? How do I create that outcome as fast as I can? And as many lessons as you can learn to get there, or as many shortcuts and as many proven methods you can use to get there, get there.

Oliver:   Right.

Kent Clothier:    Cause everything else is just noise.

Oliver:    It’s all about those shortcuts.

Kent Clothier:    Amen, baby.

Oliver:   Yeah.

Kent Clothier:    Amen.

Oliver:    Well very cool, I wanna give you a chance to just plug Real Estate Worldwide as well, and anything you got coming up.

Kent Clothier:    Yeah, I mean, I mean, we’ve always got something going on. Right, I invite anyone to learn more about us at, you can check me out at KentClothier.com go on Facebook, find me as Kent Clothier, or just go to REWW.com which is Real Estate Worldwide. And everything you wanna know about us, any of our products, our service, our events, they’re all there. We’d love to have ya, love to help ya.

Oliver:    Awesome. You got REWW.com?

Kent Clothier:    Hey man, all I do is win.

How to Find Off Market Properties

Oliver:  Wow. That’s pretty damn good. That’s pretty damn good. Well very insightful, I really appreciate your time today, coming out and talking to us. You shared some great strategies and really looking forward to implementing some of this stuff into our business.

Kent Clothier:    Absolutely.

Oliver:    Really appreciate your time.

Kent Clothier:    Alright, thanks for having me brother.

Oliver:  Thanks.

Kent Clothier:    Cheers. Thank you.

Oliver:   Appreciate it Kent. Now you’re In The Know. That was such a good way to end it.

Pullout Quotes:

“My business senses kicked in, and in the first year, I flipped 90 houses and made $1M.”

“A lot of people out there in the world … want to be entrepreneurs. For one reason or another, they have these obstacles in front of them that seem insurmountable, and it’s very challenging for them to get through it. So, I became really passionate about—man, if I can just make it easier for people to become successful, then that’s pretty cool.”

“We went from a couple hundred transactions a year to 300 transactions a year to 450 to 500 right through the recession, and the reason that happened is we were focused on people that had money.”

“Why would we not go to our customers? Why would I not go to 50% of the market that have cash and just ask them what they want? And so, that’s what we did.”

“Finding vacant properties online or finding cash buyers online or finding private lenders online has become a fairly—I don’t want to call it routine, but it’s definitely more straightforward than it’s ever been. It’s really nice to know we were at the forefront of all that.”

“We all understand what marketing is. What’s revolutionary is that you’re speaking directly to their motivation.”

“The beauty of this business is that you only have to be right a few times to make a lot of money.”

Kent Clothier and Real Estate World Wide  provides several educational service platforms for agents who want to maximize their productivity in real estate investments . His boardroom puts you in a mastermind with some of the Top investors in the country while Smart Suite is full of tools for effective lead generation and selling. For more information please visit: https://reww.com/

Resources

Real Estate World Wide
Kent Clothier
Big Block Realty

Other episodes:

Mike Ferry – How to Crash Proof Your Real Estate Business

Cory Boatright – How to Make Big Profits Wholesaling Real Estate

Thank you for watching!

If you’d like to see more episodes go to: www.OliverGraf.tv/FoundersClub

If you have any questions, comments, or ideas contact me here.