Luc Boiron - RPDRS

Alfonso: Our next presenter, he's very fortunate as well too and you saw his significant other on the panel as well, too with Jess. I have a blank page to introduce Luc cause I said, I didn't want a bio from Luc I wanted to introduce him and very fortunate that I get to call him a friend of mine and I can pick up the phone and most weeks we keep each other accountable and we're building partners on certain tasks and certain items. If you ever met this guy, he is just one of the most genuine, hardworking, just legit guys. There's nothing that you can get from this guy that you're like, oh, he's got a shady or slippery.

I know in the wholesale world do you get that sometimes all your buying properties undervalued thought on the MLS, doing things, unconventional ways. I think that's going to push it if we do the normal things and the things that are safe. Dave had mentioned, secure things, we're going to get normal stuff. If you do things that normal people do, you're going to get the things that normal people have. This guy is not a normal guy. And I mean that in the nicest way possible Luc is awesome. He is Canada's largest wholesaler. Put your hands together for Luc Boiron.

Luc: What a wonderful introduction. Who here knows about wholesaling, has seen me speak before, or just generally knows about the concept. Okay, good amount of people in the room, that's great. I won't get too deep into what it is. A little bit of my background. Thank you Alfonso for the nice introduction. I have always been a little bit unconventional. I grew up in a real estate family. I finished high school when I was 15. Went to teach English in China for two years. I came back, started school, bought my first rental property when I was 18.

With money, I'd save teaching English in China. And then I went to law school, did my MBA. I was in university for eight years, a little bit of real estate investing throughout that, but that was starting 2007 when I was in real estate. When I graduated from law school, I got called to the bar. I quit law to go full-time into real estate investing. That was my passion. It's what I wanted to do, and it's a funny story. The reason I went to law school was that I thought that it would be easier to get mortgages if I was a lawyer making money at a law firm.

Real estate was always the background. I clearly had that limiting belief that you had to have that high earning job, that high T4 income in order to buy rental properties because I didn't see it as being able to make it into a business, being able to make it into a full-time job. Started flipping, I bought about 17 flips in my first year, about 25. This year I've really scaled up. I'm gonna have 14 people who work for me in my wholesaling business. I know a lot of people think of wholesaling as a way to start in real estate, instead I see it as a business that can scale.

We've gone to 14 people, we do several million dollars a year in wholesale fees. We've bought about 75 houses so far this year. That's a little bit of what it can be. My presentation today I know not everyone here wants to wholesale. I thought for some of you, it will be useful. For the others, I hope that it's at least interesting. I'm going to talk a little bit about the difference between flipping, wholesaling and wholesaling. And then talk a little bit about our company, how we do wholesaling and hopefully that'll show the process and the systems that you can have.

I'm going to give some examples. To start, I think people generally understand what a flip is. A house, you renovate it, you sell it on the MLS. On the other side where we have the contract that's wholesaling, this is basically where we put a property under contract to purchase. An agreement of purchase and sale in Ontario here and we then assign our interest in the contract. We call that wholesaling, real estate. We're buying it off the market and we're selling it at a discount and hopefully in volume. That's the wholesaling aspect.

It's just an assignment of a contract that's wholesaling. What I call wholetailing, that's basically where it's a mix between the two. You're selling it to the retail market on the MLS, but you're not doing the full renovation and the full gut job, managing contractors, all of those headaches. That might just be buying a property that's livable in decent condition. Maybe just closing on it, cleaning it up and then listing it on the MLS is just a minimal. That's the three things that I'm involved in the process.

Step one, always marketing. This is a sales and marketing business. We start off with marketing, we send out direct mail, you get junk mail. We do some of that kind of stuff. The car we drive for dollars. We build our own lists wherever we can because in Canada, unlike the states, you can't buy lists of people who are in situations that might lead to them wanting to sell quickly. In the states, you can buy a list of people who are behind on their mortgage payments, who are behind on their property taxes.

Those people are going to have a motivation to sell most likely in Canada, you can't get those lists. You have to figure out how you can create your own list. One of those ways is driving for dollars. There's other things you can do as well. But driving for dollars is basically driving Google maps, walking, jogging, whatever you want. And writing down houses that look run down. The roof really needs to be done clearly, should have been done two years ago, but that person might not have the money to do it.

Are they going to stay in the house until it's raining in their kitchen? Or are they maybe going to sell? If you can create your own kind of lists out there it's hard to do, but the differences in Canada, there's not many other people doing it. Whereas in the states you have a list of people behind on their mortgage payments. But when you show up at their house, there's a stack of 30 postcards from other people, pros and cons. If you can be the only one knocking on that door with a bad roof and saying, hey, how can I solve your problem?

You have a very good chance of getting a good deal on that property. We do all kinds of online marketing like Facebook, Kijiji, Google, SEO, Google ads, that kind of stuff. Then we basically have a team of lead intake who vet the colors, people who want, who call and say they want to sell their house. That's the next process. You send out your marketing or you go and talk to people. You lead, you vet that process. You make sure they have motivation that the asking price they have is reasonable. They're not currently listed with a real estate agent because you could just go buy it on the MLS and that they have a reason to want to sell.

Sometimes the reason is just convenience, they don't want to have to deal with people walking through their house for showings and things like that. But other times it's they're moving or a divorce or an estate situation. Determining motivation really helps and then setting appointments. That's when you're trying to go and look at the property, walk through and try to find any problems with it and then get it under contract.

We use the standard of reform that real estate agents use for tying up the agreement of purchase and sale form. We typically try to get it signed while we're there. If possible, we give a deposit, we typically do a small deposit. We would have our offer conditional on due diligence, basically some form of due diligence. We have time to prevent it because we've only walked through at once. We haven't done a full inspection. We've only done a cursory glance of value.

We're trying to determine quickly before going on the appointment, what it's worth, but we're not doing all of the detailed due diligence, because we don't know if we're buying it. We get it under contract. Then we typically have 5 to 15 business days to insure the property is something we want to go ahead with. The advantage in the wholesaling world is we typically assign the contract during the due diligence phase. How much risk do we really have? Yeah we often put a $500 deposit. I've actually done it.

I bought one property with a dollar deposit. Actually I'm going to show that later. Some types get the best price. When you're negotiating with sellers, it helps to have them visualize and understand what the problem is. Remind them of why you are selling? Oh my daughter's going to college in another town and I want to move there nearby to support her cause I'm the only parent, okay, now you understand the motivation.

It's a matter of reminding them what their life is going to look like when the home is sold. They don't have to worry about anything. They know the home is sold. They can start finding the next property and there's different advantages we could provide. For example, you're looking to buy the next property waterloo. You're going to have some time to look for the property cause we can give you a flexible closing. We can give you the right to extend the closing date by 30 days. If you haven't found a house by a certain time, we can offer different things that they might not have otherwise.

You're also just helping them visually. How wonderful it's going to be to have that house in Waterloo, close to the college, be there for their daughter, helping them go through that whole process of school and all of that. Helping them visualize the next steps and just ensure you're convincing them that you're going to solve their problems. Because if you're not solving their problems, you shouldn't be buying their house. There's not really any purpose in you being the one. On the disposition side, this is selling the properties after we have an under contract to our buyers.

We do a group showing, we try to show it. One time to everyone. When we're talking to our seller, negotiating with our seller. We tell them how we're going to make it easy on them. If we have 20 different groups of people walking through at different times, it's not really going to be easy on them. Some of our sellers sell twists because they don't want groups of people walking through. Should we do one group showing? Basically we try to set it at a time when the most people available can do it. We try never to have more than four or five groups of people walk through the house.

I think this is quite important. A lot of people in their wholesaling, they forget they spent so much time working down the seller to get the best price, and then they just give it to the first buyer they think of. They're like, oh, and I know you're buying properties. Here you go. Which is great for you, but probably not great for the person who's selling the property. I always think of it as if I can negotiate down the seller an extra thousand. Negotiate up the buyer an extra thousand dollars. I made an extra $2,000 on that property.

Now, I want to do a hundred deals here. That's an extra $200,000 and my costs haven't gone up on that property. It's an extra $200,000 net in my pocket for a thousand dollars on each side of $400,000. It's worth it to do, and it's worth it to watch both sides of the transaction, not just one when you're wholesaling and that on the right, that's just one of our standard emails that we send out. We have a buyers list. We send out an email blast to everyone on our list. We have a separate one for Toronto and for Ottawa and everyone in that area. We'll get the email blast to see the property and there's instructions on if they're interested in who to contact.

The next step is closing and this is something I was ignoring when I was so busy doing everything myself. I ignored this process and then we would get to closing and there'd be a seller. For example, this is a situation that happened to the sellers in the house. After closing the buyer goes to the house, they have the keys, they go to the house, the seller is still living there, all their stuff is there. They haven't moved. They're like, oh, I had to move out by closing. When I say holding hands, it's that kind of process. What we do now is we send our sellers a gift before closing, 10 days, let's say before closing to make sure they're happy.

We call them and we remind them, hey, just want to make sure, are you going to have time to get everything out? You found your place. Everything's all through the process from the time we're signing, we're making sure they found their next place. They know when they're moving, we remind them. They have to, if they go, oh, I haven't found a place yet. No, you have to close on a certain day. And then the whole process goes through the lawyer.

We typically give our deposit either to our lawyer or the seller's lawyer. Our buyers would give the deposit to our lawyer and then the closing happens. Basically, let's say on an assignment sale the buyer pays the majority of the funds, the seller, and then the assignment fee to our lawyer. And I would get that from my lawyer. That's basically how the process works there. These are some tips that are some things that we do that help us negotiate better prices with sellers. It's some things we can offer that maybe aren't offered by realtors. An example is a mortgage before closing.

This is actually me giving a private mortgage to the seller. Some sellers have owned a home for a long time and they own the house outright. For example, we did in Georgetown. We gave the seller on the property outright, the husband and wife were older. Their daughter was helping them sell as well. The husband was in hospice care and the daughter had power of attorney for him. I guess the mother was selling it as well. They needed money for hospice care and they wanted to buy another property and they needed money for deposit, but they were like a lot of Canadians living paycheck to paycheck, it's quite normal.

They didn't have the money to go put a deposit on another property. They didn't have the money to fix up this property and they didn't have money for moving costs. What do you do? But we give them a $42,000 mortgage. We secured it on the property. Instead of giving a small deposit to be held by their lawyer and trust until closing or a realtor on a resident on a regular transaction, they don't have access to that small deposit.

We have a large deposit of 42,000 and by securing it on the property, we allowed it to be released to this until closing. They had a two month close and they were able to go put a deposit to go buy another property. They're able to pay some bills, pay for moving. That was one example that you will never see on the MLS. We let sellers rent back the house for a shorter amount of time, maybe a month or two, instead of the mortgage we say close on it.

We'll let you stay in the house. We'll include it in the price and we'll let you stay in the house. That way you can now, once you get the money from the sale, you can then buy your next house and you might have a month or two in the house and you can leave your junk behind. We've paid first and last and cash to sellers so they can pay first and last rent to move to somewhere else.

We paid for the moving costs. We've closed in as short as three business days. Those kinds of transactions, you need cash because it's not lenders can't get you the money that quickly. Sometimes we pay their legal costs, even though it makes no difference. It's just a mental thing for some people. They're legal costs are paid from our side instead of from their side, even though it comes out of the proceeds of the sale. They don't need to come out of pocket with it. We've taken on tenants. We allow flexible closings like I said, where it can be extended.

We limit showings as well, so that some people are hoarder, for example, they know how they live. They're not ignorant of it. They know where they live. The hoarding lifestyle and there, they don't want their neighbors walking through in an open house and judging them. We even had one seller who had 12 cats and was terrified that a realtor would leave the door open. One of her cats would run out and get hit by a car. She wanted to sell to us so that realtors wouldn't leave her door open.

If you can find a problem that you can help solve, it's really about listening to home sellers and what is valuable to them? If what is valuable to them is getting the most amount of money possible for their house. That is all that matters. Then they're probably not going to be the right seller for us, but if there's something else that we can help with with something else that we can solve, then we have a chance of buying their home. This is a wholesale flip. I'm going to go through this pretty quickly cause I didn't realize how quickly time is passing.

This was a property I assigned to another real estate investor and I bought it for 480,000 from the sellers. This one I wanted to secure with consideration. I gave the seller a dollar at the time and then agreed to give them their lawyer an extra $10,000. Once they told me who their lawyer was because they didn't have a lawyer yet. I just wrote in a clause that said I would provide an additional deposit. It was a link home. It was only linked by the garage. The house itself was attached and this is the before and after.

I didn't do the reno, the buyer from me did the reno. I just found their pictures online. But on the left side is how I sold it to them on the right is how, what they did with it. Not in this case, but that's before and after. I sold it to them for 570,000. This was my first assignment fee ever $70,000. It was a good start. I was doing too many flips at the time and I decided to assign them. The person who bought it from me ended up selling it for 785 on the MLS, after it did take him about eight months to slowly renovate it.

He made $111,000 in profit. I made 70,000, he made another 111,000. It was a very good flip. Now, I wouldn't have made the extra 111,000 necessarily myself because he was more involved with the renovations. I know his dad was there, scraping the stucco off the ceiling, he was closely supervising things keeping costs down, buying materials, things like that. He's also a realtor. He's able to not pay commission on the sale for the listing side. He had better financing. He had a line of credit on his primary residence, whereas I would've gotten a private mortgage and paid quite a bit.

In this case, he had all these savings over me. I wouldn't have made an extra 111,000. I'm going to go through this one quickly. This is the best deal I've ever done. The worst house we've ever bought the seller did not want us to see the inside of the house. They were a week away from the bank, the sheriff coming to kick them out of the house cause they hadn't paid in a long time. They hadn't had running water in the house for five years. Luckily we bought it knowing there was a lot of value. We thought someone might flip this. Someone might tear it down and build two houses, three townhouses or a six unit building.

You could do all of that as of right on the light in Ottawa. That's the zoning. The house looks relatively normal. Inside was a little bit of a hoarder situation. There was a back addition on the house. The back addition collapsed and there was a bathroom five years ago that collapsed and the plumbing lines broke and they didn't have the money to fix the plumbing lines or know how to buy a SharkBite fitting and cap it. Instead they shut water off to the house. They had kids living there with them. Also they had barbecues.

There's one, two, three and fourth, which is if you're wondering where your old barbecues go. This was as we cleaned up the master bedroom there, the kitchen. What happened was, when you don't have running water, you can't use the toilet. Obviously you use the bathtub and then when the drain starts leaking over the kitchen, you have to put the stopper in the bathtub. The bathtub fills up and when the bathtubs are full, you take the water jugs that you've been buying. Because you don't have running water and you use those as a toilet.

We felt five bins and that's the bath. If you use your imagination, it could be a mud spa. And I wouldn't recommend trying it, the smell is foul. And you can see at the bottom of this picture there's some jugs and it's not apple juice and this, you can see outside. It was like this for five years through the winter as well. In Ottawa, which has hard winters. And they had children living there. Now, they have moved out. They have rented a place. We closed on it, not having seen the inside.

We'd let them stay there for free for a month. Not having seen the inside. Then they finally moved out about two weeks later as well. And they found a place to rent. They are running. Each of the kids have their own bedroom. One of them was sleeping on a mattress pad on a pile of garbage, and now has his own bedroom. They each have their own bedrooms and they're paying a landlord who will fix the house.

Probably if something happens instead of having to take care of themselves when they clearly should never be homeowners. That property we bought for 350,000, let the tenants move out, cleared it out. We listed it on the MLS. I'm not going to get into the numbers, but it was a sizable one. It's the best deal we've ever done. It was one of our first deals in Ottawa. We listed it on the MLS for 650,000 and yeah, sold somewhere around there.

If you guys want to get on my buyers list for discounted properties, I have some of these forms in the back corner and my wife is just there. If you want to grab some of these, if you're already who here is on my buyers list. A good amount of people here have bought property from me. If you're not on my buyers list, get on, you get a couple emails a week at most. We have a separate one for Ottawa and Toronto, and feel free to follow us on social media at Jess, Luke, invest for Jess and I, wherever you can find us. Thank you so much.