Have you made the jump into real estate investing yet? If not, wholesaling is a great way to get started, even if you have some experience, I’m sure you can still learn from Raul. At only 23 years old, he is doing more deals than a lot of people twice his age.
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Raul Bolufe Real Estate Background:
-President at Capital Rise Investments LLC
-Have done over 200 deals since beginning wholesaling in 2014
-By age 23 he has wholesale over $15M and made $355K off of the MLS
-Now has a team of 7 people and 3 agents working with the company and growing
-Based in Miami, Florida
-Say hi to him at capitalriseinvestments.com
-Best Ever Book: 10x Rule by Grant Cardone
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Mentioned in this episode:
Joe Fairless: Best Ever listeners, welcome to the best real estate investing advice ever show. I’m Joe Fairless and this is the world’s longest-running daily real estate investing podcast. We only talk about the best advice ever, we don’t get into any fluff. With us today, Raul Balufe. How are you doing, Raul?
Raul Balufe: What’s up, man? Thanks for having me, Joe.
Joe Fairless: Nice to have you on the show, my friend. A little bit more about Raul – he is the president at Capital Rise Investments. He has done over 200 deals since the beginning wholesaling in 2014. By the age of 23 he has flipped over 15 million dollars of property and made 365k off of the MLS – we will get into that. He is based in sunny Miami, Florida. With that being said, do you wanna give the Best Ever listeners a little bit more about your background and your current focus?
Raul Balufe: I started investing a couple years ago, about three years back. It was a scary transition, because especially in this market it’s really competitive, but I figured “Hey, if other people can do it, I think I can do it, too.” I was actually selling cars at my dad’s dealership, and then I saved enough money and I bought my first rental property and I figured “Hey, I could do this again.” So I started listening to podcasts, reading books, and I got into it.
I got a mentor down here, and I started with the MLS, learning how to send offers, learning how to find buyers, and that’s pretty much how I got my first deal. Now I’m just running with it… We still do MLS, but now we’re doing a lot of mail, we’re doing some bandit signs, we’re doing some internet marketing, websites, and we’ve kind of grown to a team of about eight men, and doing some deals.
Joe Fairless: You’ve got an eight-men team… Walk us through who does what.
Raul Balufe: I’ve got an assistant secretary – she pretty much answers the day-to-day calls and does the checks and pretty much the organization. I have an acquisitions manager for MLS, then I have a sales manager that pretty much does all the sales, I have two acquisitions members, I have one sales guy, and then I have an office manager and two VAs. I don’t know if I lost you there, but…
Joe Fairless: No, you didn’t… [laughs] I’ve been taking notes. Who did you hire first?
Raul Balufe: My first hire was actually one of my first VAs.
Joe Fairless: And how did you find your VA?
Raul Balufe: Online, through Upwork.com. I think before it was oDesk, or something.
Joe Fairless: Yeah… What did you have the VA do?
Raul Balufe: I had the VA send offers for me. I kind of showed him how to fill up the contracts using freedom soft, and I had the VA tell him what [unintelligible [00:04:54].02] and then I would send him the information that would do it.
Joe Fairless: What type of training process did you do at the VA?
Raul Balufe: I actually got some of the training process from another podcaster, Joe McCall… He has some training thing for that, of what to have VAs do. I used the backbone of that, and then I kind of just implemented my own little strategy with them. But usually through e-mail or through YouTube video – I’ll make a little video of how to do it, and they would do it.
Joe Fairless: And how much do you pay them an hour?
Raul Balufe: One VA – I have him at $3.33 and the other one at $4.50.
Joe Fairless: For someone who has a wholesaling business and wants to make that first VA hire, what would you recommend to them? Either a lesson you’ve learned, or ways to get out of the gate strong.
Raul Balufe: What I would recommend is make sure that you yourself know how to do the task very well first, before you can get someone to do it… Because since it’s not in person, you can’t really show them, so it might take a lot of explaining and videos and training to really get them to do it. So make sure you really know how to do it perfectly before you get someone to do it.
Joe Fairless: So before we try and automate our process, we actually have to know the process – is that what you’re saying?
Raul Balufe: Yeah, man… It makes it a lot easier. It’s just so much easier to be able to train somebody on something that you know how to do in and out, so they can sense that you know how to do it.
Joe Fairless: 15 million dollars worth of properties that you’ve wholesaled, right? Not fix and flipped, but wholesaled?
Raul Balufe: Wholesaled, correct.
Joe Fairless: Okay. And how old are you now?
Raul Balufe: 24.
Joe Fairless: And when did you get started? In 2014?
Raul Balufe: Yeah, correct.
Joe Fairless: So 2014, this is 2017 – so in 2016 you were 23 and in 2014 you were 21. So you started when you were 21 years old, and in two years you had wholesaled over 15 million dollars worth of property, right?
Raul Balufe: Yeah… I’m right around 26 million now.
Joe Fairless: What was the first property you wholesaled?
Raul Balufe: The first one I did was actually — I was doing a technique that I learned from Joe McCall, actually… Pretty much texting landlords on GoSection8.com, asking them if they wanted to sell their house. I got a hold of a property manager, and the property manager introduced me to the landlord. That’s pretty much how I got the first deal. I said, “Hey, are you looking to sell?” He said “Oh, I’m not, but my landlord is. I manage his properties.” He put me in contact with him and he gave me a lot of information about his properties; I made him an offer, and I actually got two under contract. That’s how I got my first deal.
Joe Fairless: Where are these properties located?
Raul Balufe: South Florida.
Joe Fairless: Can you give us the numbers on that first one?
Raul Balufe: I was getting it for 62k and I assigned it for 68k. So I made about 6k there.
Joe Fairless: And you mentioned GoSection8.com – obviously, it’s a website. I haven’t heard of that one.
Raul Balufe: That’s pretty much a website where landlords and potential tenants can go and view properties that are Section 8-ready… Pretty much properties that the landlords only want to rent to Section 8 tenants.
So the tenants can create an account as if they’re the tenant, and they’re able to view these properties. The landlords create an account like if they’re landlords, and they can list their properties there. And it’s free.
Joe Fairless: Okay. And you went online and you texted the number, you got a hold of a property manager who then introduced you to their client, the landlord, and then you wholesaled his property.
Raul Balufe: Correct.
Joe Fairless: $62,000, and you signed it for $68,000… You gotta do a lot of those to make up 15 million in two years. Help fill in some of the gaps there.
Raul Balufe: When I say 15 million it’s worth of properties, not 15 million profit.
Joe Fairless: No, I get it. I was with you on that. [laughs]
Raul Balufe: Yeah, okay… I’m like “Damn [unintelligible [00:08:55].22] I’d be next to Donald Trump, or something.” So basically our average property now is about 120k. Basically, we do about 80 deals a year.
Joe Fairless: Okay, I’m with you.
Raul Balufe: Do you kind of see how I got there? So the 60k one is one on the lower end.
Joe Fairless: That was your first property.
Raul Balufe: Yeah, it was my first one. So now our average wholesale is from 140k, 160k, something like that.
Joe Fairless: What are you doing with the profits? Are you investing them into long-term holds, or are you just putting them all back in the business, or are you buying cars, or what?
Raul Balufe: No, not cars, man… [laughter] Maybe a little bit. So a big portion of it in the beginning (in my first two years) was going into buying rental properties. I accumulated a little portfolio of single-family homes – I’ve got about ten of them now. After I did that, I started putting more of the profits back into the business: hiring new people, sending more marketing… That’s when I got more into mail and online advertising, and hiring more staff to help me grow.
So to answer your question – yes, in the beginning more towards buying properties for rental income, and then now the majority going back into the business.
Joe Fairless: What’s been the best investment that you’ve made back into the business and what’s been the worst investment that you made back into the business?
Raul Balufe: That’s an awesome question. [laughs] I like that question. Okay, so the best investment made back into the business was reinvesting in mail marketing. I’m sure you hear – and probably everybody listening to this probably hears a lot of podcasts or reads books, and they hear that mail goes up, it goes down, but if you’re consistent, mail works. At the end of the day it’s just the way I’ve seen it.
I might have a month that I get a 2% return, I might have a month that I get a 6% return. It just all depends, but being consistent with the mail has helped me out a lot. And apart from getting deals through it, it builds a lot of credibility, because you’re getting off-market stuff, and buyers love that.
When I get an off-market deal and I’ve got them through mail, it really builds a lot of hype towards the properties that we’re getting, and it shows that we’re active out there. We’re not only getting deals that are on-market, but we’re also really hunting for those deals that are off-market.
Joe Fairless: No one else has mentioned the “building the credibility because you’re getting off-market deals”, and I’m glad that you did, because I never thought of that.
Raul Balufe: I saw that happening, because I’d be like “Man, this house’s price is the same as the ones that are on the MLS, but we’re getting three times the amount of calls.” So as I start talking to these people, they’re like “Yeah, but I haven’t seen this deal before. How many more of these do you get?” I’m like “I’m actually getting them more frequently now because I’m doing a lot more marketing.” They’re like, “Okay, make sure you put me in your VIP list. Make sure you get me on there.” I’m like, “Alright man, will do.” I started noticing that… And it gets more buyers, and you can then turn those buyers into people who buy other properties.
Joe Fairless: I like that. And what about the worst investment you’ve made back into your business?
Raul Balufe: The worst investment that I made back into my business… Great question. Well, I would have to say it was maybe spending it on systems that I didn’t need. I don’t wanna name any names, because I’m not out here to bash anything, but mainly just systems that you don’t need. Try to simplify your business.
Obviously, you need a CRM, or you need certain sheets or computers or software or whatever, but don’t get over-hyped on all that stuff. Get stuff that works for you and that makes it simple to buy and sell houses, or whatever your business is. So maybe that was a big spending mistake.
Joe Fairless: I’m not asking you to name a name of the system or the software or whatever, but I would be curious to know – and I’m sure the listeners are as well – what functionality did that have that you were like “I don’t need that.”
Raul Balufe: Well, functionality maybe not so much, but more like — for instance, I had one CRM for buyers, one CRM for sellers; I had another CRM for contacts… But one CRM could have done all three, if you can find a way to customize it, or whatever. So I was kind of like falling in love with “Oh, this CRM has this feature, this CRM has these features”, but do I really use all those features? I’d rather just put in one platform and customize it as best as I can, even if it takes a little bit more labor… But really get it on one system so it’s just more organized, more clean. You go to one place to find all your leads, one place to do your follow-ups… It works a lot easier.
Joe Fairless: What CRM do you use? Because obviously you’re happy with it if you’re using it.
Raul Balufe: I use FreedomSoft. I’ve been using it since I’ve started. It made a lot of good changes recently. I know Rob Swanson took over not that long ago. I really like it; it works perfectly for me. For buyers, sellers, you can put your contracts on there… I like the new leads tab; you can get phone numbers, and stuff… It’s pretty cool. I don’t even use all the features, but it has a ton for me to use and it’s really user-friendly. It’s nice, I like it.
Joe Fairless: Best Ever listeners, you can listen to our interview with Rob Swanson, episode 772, how he scored ten million dollars at the bottom of the real estate market.
What is your best real estate investing advice ever?
Raul Balufe: My best advice is pretty much staying consistent. I was actually talking to somebody today – it’s really easy to give up in real estate. Real estate was never made to be a short term gain type of business; it’s always been like a buy and hold business, or buy your home, resell it in a year, or whatever. If you stay consistent, constantly talking to leads, sending mail or whatever way you like to get leads, and you take the right actions, you can succeed; you will succeed. You just have to be consistent.
Joe Fairless: How do you educate yourself? Because your mind has evolved more than other early 20-year-olds that I’ve come across, so clearly you’re into personal development, and you’ve mentioned some podcasts… Where do you get that information from, and have you always been that way?
Raul Balufe: I’ve always been very curious and I kind of wanna know how everything works, so that was kind of like in my nature, but podcasts have helped me a lot. You can just find so much information on podcasts… Your podcast – you have a ton of interviews with very interesting people, successful people… A ton of all these other real estate podcasts – I mentioned Joe McCall, Sean Terry, Matt Theriault… If you just listen to a bunch of these podcasts, you get a lot of knowledge… Way more than you even need. So that definitely helps a lot.
I read books… I know you’re big on books; you ask for everybody’s favorite books at the end of this show… So I love books, podcasts, YouTube, webinars… A little bit of everything. There’s tons of free education out there.
Joe Fairless: What are some of your favorite go-to resources?
Raul Balufe: Well, I purchased some of the courses from Sean Terry and Matt Theriault – I’m constantly going back to those courses. I like to refeed that material back in me; even if it’s like the basics, it’s always important to know the basics. Once you fully understand that, you can really start thinking like “Okay, in my business how can I implement the basics again?”, whether it’s sending mail, or… However you get leads – MLS – you always gotta go back to the basics, buying and selling. That really helps me a lot.
Podcasts – I listen to your podcast, I listen a lot to Matt Theriault and Epic Real Estate…
Joe Fairless: Now I wanna go back to the direct mail marketing, because you said that’s been the best investment you’ve made back into your business, and you’re consistent with it. Will you define what consistent is as far as frequency and how many you send out?
Raul Balufe: I’ll get a list and I will send once a month for six months minimum. Whatever list that may be and however many people, I’ll send for a month, every month, six months straight… And different pieces of mail. I’ll send a postcard one month, a letter the next month, then another postcard, then another letter… All different for six months. I think that anybody hitting a list should at least hit it three months back-to-back-to-back, and for ultimate results, six months.
Joe Fairless: And have you looked at how many leads you’re getting from the one, two, three, four, five and six-month mailers and have you seen which mailer generates the most leads as far as one through six months?
Raul Balufe: I have tracked that, however I will say — that’s kind of a good question, but what I see is that I get easier sales or easier acquisitions months four, five and six. Maybe the leads won’t be the same amount, but it’ll be a lot easier to get that house under contract, because they’d already seen my name for three months or four months; I don’t know if that makes sense.
Joe Fairless: Yes, that does. Are you ready for the Best Ever Lightning Round?
Raul Balufe: Yeah, let’s do it.
Joe Fairless: Alright. First, a quick word from our Best Ever partners.
Break: [[00:18:08].15] to [[00:19:00].00]
Joe Fairless: What’s the best ever book you’ve read?
Raul Balufe: The 10X Rule by Grant Cardone.
Joe Fairless: He’s a Florida guy, isn’t he?
Raul Balufe: Yeah, he lives in Miami. He lives in [unintelligible [00:19:06].27]
Joe Fairless: Best ever deal you’ve done?
Raul Balufe: The second property I bought – a single-family home. I bought it for like 47k, put in like 20k; I’ve been renting it for three years and I just got it appraised for like 150k.
Joe Fairless: Congratulations. How did you get the money to buy that single-family home?
Raul Balufe: I had already wholesaled a couple houses, so I had some money saved up. Then I got a hard money lender.
Joe Fairless: Do you still have that hard money loan on the property?
Raul Balufe: I do, I have renewed it for these years, but I am in the process of refinancing it with a conventional bank.
Joe Fairless: Best ever way you like to give back?
Raul Balufe: I actually enjoy teaching and mentoring people who are not as fortunate or maybe not as savvy with information or school. I like to kind of just speak motivation to them as much as I can, and share with them any secrets or anything that helped me along the way or keeps helping me in my business. I like to help people who kind of see things a little bit differently.
Joe Fairless: What is a mistake you’ve made on a transaction that you can think of?
Raul Balufe: On a transaction… Definitely with buyers – collect their escrows. That sounds simple, but man, these buyers are sharp.
Joe Fairless: Will you elaborate on that?
Raul Balufe: So if you’re selling a wholesale deal, a lot of times for me if I’m doing [unintelligible [00:20:35].05] I gotta put that escrow; so I’ll sell it to a buyer, I’ll get the contract signed, and in the beginning I kind of put it off, like “Okay, it’s a done deal…” But then a week will pass by, they never followed up, they never sent deposit, and they’re like “Okay, I don’t want the deal anymore for some reason”, and now I have to rush and find another buyer, do this, do that… That will all be avoided if you collect the deposit or have them sent to the title company when you sell the property to them.
Joe Fairless: What’s the best place the Best Ever listeners can get in touch with you?
Raul Balufe: They can go on our website or our Facebook, Capital Rise Investments LLC, or CapitalRiseInvestments.com. I have my office number there and my e-mail – all that information if you guys wanna get a hold of me.
Joe Fairless: Raul, thank you for being on the show and talking about how quickly you’ve gotten out of the gate in real estate, in two years, from 21 to 23, having wholesaled on average over 15 million dollars, which I think was on average like 200 or so houses (I think) when I did that math…
Raul Balufe: Right. 80 houses a year.
Joe Fairless: Yeah, 160… Yeah, I knew that didn’t sound — yeah, 160. I was doing the math off of the 68k, so that’s what it was. But it’s very impressive what you’ve done and the team that you’ve built, and how you have put a premium on the learning and then applying what others have done and then replicating the model. I think that’s the storyline for this conversation – you’re not recreating the wheel, you’re simply implementing what’s been proven that other people have done and you’re taking massive action and you’re scaling along the way.
Raul Balufe: A mix of education and action is definitely the way to go in any type of business or in anything you do in life; as long as you learn the right things from the right people and implement the action and you do it consistently, you’re set up for success. You cannot fail.
Joe Fairless: You summarized that much better than I could. Thanks for being on the show. I hope you have a best ever day, and we’ll talk to you soon.
Raul Balufe: Thanks, Joe. I appreciate it. Take care!
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