How Does Wholesaling Work In Alabama?

Want to work directly with me to close more deals? Go Here: https://www.titaniumu.com
Want the Closer’s Formula sales process I’ve used to close 2,000+ deals (FREE) Go Here: https://www.kingclosersformula.com/close


If you’re new to my channel my name is RJ Bates III. Myself and my partner Cassi DeHaas are the founders of Titanium Investments.

We are nationwide virtual wholesalers and on this channel we share EVERYTHING that we do inside our business. So if you’re looking to close more deals - at higher assignments - anywhere in the country… You’re in the right place.

Who is Titanium Investments and What Have We Accomplished?

Over 10 years in the real estate investing business
Closed deals in all 50 states
​Owned rentals in 12 states
​Flipped houses in 11 states
​Closed on over 2,000 properties
​125 contracts in 50 days (all live on YouTube)
​Back to back Closers Olympics Champion
Trained thousands of wholesalers to close more deals

_________________________________

With over 2,000 Videos, this is the #1 channel on YouTube for all things Virtual Wholesaling. SUBSCRIBE NOW!    https://www.youtube.com/@RJBatesIII

_________________________________

RESOURCES FOR YOU:

If you want my team and I to walk you through how to build or scale your virtual wholesaling business from A to Z, click here to learn more about Titanium University: https://www.titaniumu.com

(FREE) If you want to learn how to close deals just like me, The King Closer, then download the free King Closer Formula PDF: https://www.kingclosersformula.com/close

(FREE) Join our exclusive FB group community for real estate investors and wholesalers: https://www.facebook.com/groups/titaniumvault/

(FREE) Click here to grab our Titanium fleet free PDF & training: Our battle tested strategies and tools that we actually use… and are proven to work: https://www.kingclosersformula.com/fleet

Grab the King Closer Blueprint: My Step by Step Sales Process for closing over 2,000 deals (Only $37): https://www.kingclosersformula.com/kcblueprint

Grab Titanium Profits: Our exact system we use to comp and underwrite deals in only 4 minutes. (Only $99) https://www.kingclosersformula.com/titaniumprofits

Want to know what the best markets to wholesale in are? Grab my breakdown of all 50 states here: https://www.titaniumu.com/markets

Chapters

• 0:00 Alabama Edition Introduction
• 1:25 Acquisition vs Disposition Challenges
• 2:42 Underwriting and Comps Strategy
• 4:40 Buyer Negotiation Reality
• 5:50 Alabama Wholesaling Regulations
• 8:10 Final Advice for Alabama Market

Transcript

Speaker 1: 0:05

Welcome back to Wholesaling Around the World, the Alabama edition. Now, this comes because of popular demand. And by popular demand I mean one comment asking me hey, rj, can you make the next Wholesaling Around the World episode, the Alabama edition? So, just like I always ask, you guys commented and I'm bringing it to you. So today we're going to talk about Alabama.

Speaker 1: 0:33

Listen, my gut reaction about Alabama is it's a love-hate relationship. All right, alabama is one of those states that it is easy to do acquisitions but it's pretty difficult to do dispositions. Now, this makes sense because we always like to start with population. The population of Alabama is just north of 5 million people, putting it ranked as the 24th most populated state in the United States of America. Now that makes sense. As to why I would love and hate it, because it's right, smack dab in the middle as far as population goes. My theory as to why I believe Alabama is easy to do acquisitions and difficult to do dispositions is a couple of different factors. One the price point's low. The majority of the houses there are lower price points. It's very similar to Michigan.

Speaker 1: 1:36

In regards to your need to underwrite correctly, you've got to pay attention to the as-is comps. You've got to pay attention to the as-is comps. You can't just look at it and use an after repair value, multiply by 70%, subtract repairs and subtract your rehab, or subtract your wholesale fee and come up with a maximum allowable offer, because if you do those, end buyers are going to chew you up and spit you out. The other side, they pay attention to those as-is comps. They're also paying attention to the rent rates. The rent rate is extremely important and, going back to how similar it is to Detroit and parts of Michigan, it's also going to depend upon what side of the street you're on. Street by street, neighborhood by neighborhood, the comps change drastically throughout the major metro areas.

Speaker 1: 2:29

Now, the biggest, largest city in Alabama being Birmingham, that is the place that we have done the majority of our volume inside the state of Alabama. Now, that being said, it's not the only place that we've done deals. We've done deals in Mobile. We've done deals in Mobile. We've done deals in Montgomery. We've done deals in Tuskegee I'm looking at my map here Gadsden, hamilton, huntsville, adson, trustville, selma, I mean we've been all over the state, all right. Now our volume in Alabama, just like everything else in regards to Alabama, pretty middle of the road, our average assignment fee is on the lower side, though Again, going back to listen, if you're gonna wholesale a $10,000 to $30,000 purchase price property, there's only so much revenue that you can generate from a wholesaler perspective, those price points.

Speaker 1: 3:31

So overall, I believe Alabama is one of those markets that, if you're a nationwide virtual wholesaler, you're going to do deals there, you're going to come across a highly motivated seller and you're going to be able to get a good deal and you should be able to dispo it. It's very common when you go to dispo a property in Alabama though, where depending especially if you're outside of Birmingham or Mobile or Montgomery, some of the larger cities where the buyers leverage the fact that they know that they're one of the very few buyers that were buying one of the rural locations and so they'll leverage the fact that they know that they're like the buyer against you as a wholesaler to get that at a steeper discount. So when you're underwriting deals, yes, pay attention to those as-is comps, but also you need to be buying at a steeper deeper discount for your end buyers. Go into it knowing that there's probably going to be quite a bit of negotiation in regards to the purchase price from your end buyer. It's not going to be like a Dallas Texas or a Houston Texas or a Phoenix Arizona or maybe a Tampa Florida where hey, there's going to be like this fight over the deal and you're going to be able to move it. It's going to be more of I have now located the buyer for my deal and they're leveraging that position against you to get the best deal possible. So what's very common, at least for us as a virtual wholesaler and again, I have not built out an extensive buyer's list in Alabama, this is just my perspective of virtually wholesaling in Alabama is that when you present a deal going into it, say, if you're asking for a $15,000 assignment fee, it's very common for that to get negotiated down to where maybe it only ends up being $5,000, $7,000, $8,000 because they leverage the fact that they know that they're the only buyer. Other things, according to David Olds from Easy REI Closings report the War on Wholesaling.

Speaker 1: 5:51

There are regulations in the state of Alabama, so let me go through those real quick. The regulations under the Alabama Real Estate Commission. Alabama requires wholesalers to follow specific disclosure and licensing regulations to ensure transparency and real estate transactions. Disclosure requirements Wholesalers must disclose their intent to market the property to sellers and buyers must disclose their limited interest to potential purchasers and assignees. Licensing While a real estate license is not mandatory, wholesalers must comply with the Alabama Real Estate Commission's regulations. These rules ensure sellers and buyers are fully informed and reduce the risk of disputes.

Speaker 1: 6:40

Potential legal action for failure to disclose or comply with the Alabama Real Estate Commission rules is a $10,000 fine and or a Class C felony. Again, you can pick that up at thewaronwholesalingcom. So thank you to EZRAI Closings and David Olds for putting that report together. Listen, this regulation is actually one of the better regulations out there for us as wholesalers. All this is simply saying is that you as the wholesaler is telling everyone that you're a wholesaler. It's really not that big of a deal. We have a similar regulation here in the state of Texas. Title Company can help you with this disclosure Inside of the state of Alabama. It's an attorney state. We use Jeff Palmer. You could use their disclosure that they provide for you so you can make sure that you're not under any liability to have that penalty, that fine. Of course you don't want to get a felony. So transparency, telling the seller. Don't want to get a felony. So transparency, telling the seller.

Speaker 1: 7:46

My intentions are to wholesale this property, I'm going to sign my equitable interest More often than not, if you are closing deals the correct way, there's zero issues with this. So, with Alabama being the 24th most populated state and with it being of lower price points, my feedback is yes. Acquisitions is easier. Disposition is going to be a little bit harder. If you are breaking in to the Alabama market, I suggest stick to Birmingham, and Birmingham only Some of the more rural locations. Dispositions could almost be impossible, and there's a lot of rural land inside of Alabama. Okay, if you've ever made that drive which, lord knows, I have made the drive from Texas to Florida far too many times I've spent some significant time in the state of Alabama. It is very rural, okay, so be careful. You can get what appears to be a great deal.

Speaker 1: 8:50

You've got to go back and trust what your eyes are telling you, what the numbers tell you. So when you're comping, make sure that you're keeping it within the tight radius, pay attention to the days on market and then also use your disposition software whether it's InvestorLift, investorbase, privy, propstream, whatever it is that you're doing to try to locate your end buyers. Trust what that's telling you and look for buyer's activity. If there is none, then quite frankly, there's no need for you to comp and underwrite the deal because you don't have anyone to assign that deal to. So trust what your eyes are telling you, trust the data and, honestly, if you're brand new to Alabama, stick to the largest city, birmingham. Do some deals there and you can explore out. You never know, maybe you'll assign a deal to a Birmingham buyer and he says hey, I'm looking.