Episode Transcript
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SPEAKER_00 (00:07):
Welcome back to
Wholesaling Around the World,
the Arizona edition.
This is a series where I breakdown my personal feelings about
virtually wholesaling state bystate.
And today we're going to betalking about the 14th most
populated state, and that'sArizona, with just south of 7.7
million.
(00:28):
People is also the sixth largeststate by area.
You know, hey, it's a lot ofland, 14th most populated.
So kind of we're ranking closerto the middle than we are the
top.
Listen, overall, I think mostpeople have a general idea of
what to expect inside ofArizona.
(00:50):
It's not unknown like theConnecticuts or the Maines and
the South Dakotas, right?
You don't hear about peoplethere.
Arizona is the land of thegurus, right?
Everybody knows all the bignames out there: the Tranglings
and the Carlos Reyes and theJamil's and the Paces.
We all know them.
(01:11):
And we hear about theirbusinesses.
And so you hear the good side.
What I will say is my personalfeelings about Arizona is it is
one of the most volatile statesto wholesale in.
And what I mean by that is ifyou go all the way back to where
the majority of us weren't eventhinking about wholesaling back
(01:31):
in 2008 and 2009 when we had thecrash, the real estate crash,
and really the last majorcorrection inside the real
estate market, Arizona was oneof the places that was most uh
devastatingly hit.
And from there, the correctiononce the real estate market
(01:52):
started coming back up was yousaw the prices go extremely
high, and you saw a lot of realestate investors want to get
into there, they wanted to getinto that market and capture
these low price points that weremassively increasing.
Now, because of that, it was agreat place to virtually
wholesale in.
You had buyers that were willingto pay more than they were in
(02:17):
the majority of the UnitedStates, very similar to Las
Vegas, right?
You could go in and I rememberhearing people talk about 80,
82, 85 percent of ARV minusrepairs.
That's where in buyers werewilling to pay.
And we're not talking about bigedge funds, we were talking
about actual like flippers andlandlords were willing to buy at
(02:41):
this high price point inside ofMaricopa County and Phoenix,
Arizona.
Now that we've started to see alittle bit of correction since
2022, nothing you know crazy,but interest rates went up, and
buyers started to have to makesome decisions and protect
(03:02):
themselves.
We have seen that prices havestarted to come down some, in
buyers are a little bit morestrict, and so I used to always
use Phoenix, Arizona on thevirtual wholesaling side as an
example of acquisitions is superdifficult, dispositions very
easy.
(03:22):
I feel like we're currently herein September, October of 2025,
where it's starting totransition into acquisitions
becoming a little bit easier,dispositions becoming a little
bit harder, making it closer toa normal market where you have
(03:44):
to buy at a steeper discount,you actually have to bring
better deals, not just anythingthat you lock up under contract,
is going to be considered awholesale deal.
And so, because of that,Arizona, in my opinion,
specifically in Phoenix, ofwhich is the major metro area,
has become not quite as enticingas it was.
(04:07):
Because the benefit aboutPhoenix back in the day, even
though it was harder to acquiredeals than say a Texas or
Florida or Georgia, was that youmade a larger assignment fee.
And so I've also started to seethat the assignment fees are
starting to come down to more anormal average assignment fee.
(04:27):
And because of that, I putArizona kind of in that 20th
ranking, right?
Not in the top 10, not anywherethat I want to do a ton of
volume.
It's not a state that I'm goingto ignore.
It's not a state that I'm goingto say, hey, we shouldn't pay
attention to that.
But it's also not like, ooh,every lead that comes into
(04:50):
Arizona, I want to hop on and Iwant to get.
So it's still very competitiveout there.
(05:11):
All I'm trying to do on ayear-by-year basis in Arizona is
to stick my straw in the Arizonamilkshake and get somewhere
between five to ten deals whereI capture some low-hanging
fruit, I move my deals, and Imove on.
Now that's in the Phoenix area.
Let's talk about some of theother areas inside the state.
(05:32):
For example, Tucson, um, wherethe University of Arizona is.
We've done deals down there, notnearly as much volume as
Phoenix.
We've also done deals up in theFlagstaff and Sedona areas, and
then some of the surroundingsmaller areas um outside of
Phoenix.
(05:53):
There is a lot of land that hasno population, and it's going to
be really difficult to do deals.
Shout out to Yuma, Arizona,right on the border of Mexico,
California, and Arizona.
We have done deals there aswell.
But there's going to be quite abit of areas where you're just
never going to touch.
So, in regards to my map whereI've done deals, it's very uh
(06:17):
tight-knit, right?
The vast majority of the area ofland is going to be untouched.
It's also one of the states verysimilar to Colorado, where
you're going to see a lot ofvacant, raw land that's today
useless, right?
It's more for like recreation.
Um, you can pick those up forcheap on seller finance, maybe
(06:38):
have a play there where you cansell it on terms and earn some
interest.
But majority of your deals aregoing to come in the Phoenix
area, all of the surrounding ofPhoenix, Tucson would be number
two, and then Flagstaff and Yumawould be the other smaller
areas.
Now, one of the issues that hascome up in Arizona is there are
(07:01):
some pretty strict regulations,and the regulation in Arizona is
that it mandates thatwholesalers disclose in writing
their status as a wholesalerbefore entering a binding
agreement with a seller.
Sellers would have the right tocancel contracts without penalty
(07:27):
and keep any earnest money ifthis disclosure is not made
prior to the contract beingsigned.
This regulation enforcestransparency between wholesalers
and sellers.
It also empowers sellers to backout of deals if the wholesaler
(07:47):
fails to meet their disclosureobligations.
And the penalty is obviously thecontract cancellation by
sellers, forfeiture of earnestmoney, and the potential legal
action by the seller.
So if you do not disclose and betransparent with the seller
prior to them signing thecontract in writing, like it's
(08:09):
not just transparent on thephone and say, Hey, I'm a
wholesaler, it has to be a partof the agreement that they're
signing.
Then the seller has the right toterminate that contract at any
time, keep your earnest money,and potentially take legal
action.
Now, this isn't one of the worstregulations, but it is pretty
(08:31):
strict, and it does give a tonof power to the seller.
Now, I personally feel like thereason why this regulation has
come down in Arizona is becauseof the amount of influencers and
the wholesaling knowledge thathas come from the Arizona
investor base.
(08:52):
And I feel like, well, at somepoint in time, you finally got
the wrong attorney general, atleast for our industry, in there
in the state of Arizona.
And now they have chosen to comedown pretty hard on us as an
industry.
However, that being said, it'sreally not that difficult to
just play within the rules, justdisclose that you're a
(09:13):
wholesaler in writing to theseller prior to a contract being
signed.
This makes it fairly easy andsimple.
Now, going back to a King CloserReacts that I had a couple weeks
ago, an Arizona realtor wasextremely hard on wholesalers,
talking about we were equitythieves and talking about how we
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would not disclose that we weregoing to make money from the
seller and how we were stealingthat seller's equity.
However, that is a very outdatedpoint of view for an Arizona
realtor now that this regulationhas come down.
And because of that, it nowmandates that each and every one
of us, unless we don't want toplay within the rules, which
(09:58):
would be foolish, now have tocome in with complete
transparency with the sellers.
So personally, I like thisregulation.
I think this would be welcomedby the majority of us throughout
the United States.
I have no problem having adisclosure signed by a seller
saying, Hey, I'm signing thiscontract and I know that
(10:19):
titanium investments is awholesaler.
This makes it easy for us toabide by the rules, and it's
simple for us to explain to aseller exactly what's going to
take place.
So for me, I don't view this asa negative.
However, I do feel like there'squite a bit of competition
inside the Arizona market thatis not going to play within the
(10:42):
rules and also is going toignore this regulation, which
again, I think is foolish.
I feel like this attorneygeneral in Arizona has full
intentions to come down evenharder on us as an industry.
So for anyone that's currentlywholesaling inside of Arizona,
play by the rules.
Disclose that you're awholesaler prior to signing
(11:03):
contracts.
The worst thing in the worldthat could happen to you is you
do all the work and you lose outon your assigned deal at the
closing table because you justdid not disclose it up front.
So play within the rules.
For those of you that arelooking to virtually wholesale
and trying to decide what areasdo I want to work in and what
(11:23):
areas do I want to avoid.
Here's what I would say aboutArizona.
Yes, you can get deals, and yes,they can be highly profitable
deals just due to some of thehigher price points,
specifically inside of MaricopaCounty.
Now, going into that, you haveto understand that there is
quite a bit of competition andcompetition that has deep
(11:43):
pockets in that area.
I do not believe that if you'regoing to be a virtual
wholesaler, Arizona would everbe a higher volume market for
you unless you just specificallytarget it and go all in.
If you're wanting to be anationwide wholesaler, your goal
should be to just get a coupleof deals inside of there,
potentially in some tertiary,secondary markets right outside
(12:07):
of Tucson or Phoenix.
Overall, I feel like Arizona isa middle of the road market for
us as virtual wholesalers.
But there's always money to bemade.
So for those of you that arecurrently closing deals inside
of Arizona, let me know.
Do you disagree or do you agreewith my take on Arizona?
(12:29):
Show me some love, like today'svideo.
We'll see you guys tomorrow.