The Titanium Vault hosted by RJ Bates III

Can You Really Make Money Wholesaling In Arkansas?

• RJ Bates III • Episode 614

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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.

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Over 10 years in the real estate investing business
Closed deals in all 50 states
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Speaker 1:

Welcome back to Wholesaling Around the World. Today we are going to be talking about Arkansas and my feelings around virtually wholesaling in the state of Arkansas and I have to tell you, if you had asked me back in 2020, prior to the first 50 deals and 50 states and 50 days challenge, I would have anticipated that Arkansas would have been one of my least favorite states, just purely based off of my knowledge of Arkansas the lack of population and kind of really the lack of a major metro area. I know we have Little Rock, but outside that it's really pretty rural throughout the state. But since 2020, arkansas has surprisingly been one of my favorite states to virtually wholesale in. Now Arkansas comes in with a population rank of 33rd, with just north of 3 million people inside the state and, like I said, we have Little Rock, which is, I guess you consider it, the major metro city for the state of Arkansas, but in comparison to other major areas and other larger states, it doesn't really compare. But on the wholesaling side, we have the perfect ingredients for what we are looking for and that is there is a significant number of motivated sellers and a large enough buyer pool throughout the state that enables us to move deals, no matter the location.

Speaker 1:

Now there are a couple of things that you have to pay attention to inside the state of Arkansas. Now, there are a couple of things that you have to pay attention to inside the state of Arkansas. First, inside of the cities like Little Rock, hot Springs, fayetteville, jonesboro these are going to fall under those markets that you really have to pay attention to the as-is comps, current market value. Really pay attention to what your competition is doing and the competition that is currently listed on the MLS. That is one area that could get you into trouble inside of the state of Arkansas, because your end buyers are going to be willing to buy those properties off the MLS and they are going to pay attention to hey, why would I buy this property from you for $50,000 when I can go pick one up on the MLS for $25,000? So pay attention to the as-is comps. Very similar to the Kansas cities, the Birmingham's, the Detroit's areas, like that. Now, another thing that I want you to pay attention to is is not necessarily fearing that the deal is too rural because it's outside of that major metro like a Little Rock or Fayetteville, jonesboro or something like that. What I have learned about the end buyers in Arkansas is that they are willing to travel, and I believe that is what differentiates Arkansas from some comparable states in size of population, because the end buyers are willing to go outside of just the major cities like Fayetteville and Little Rock. They're willing to go to those conways and you also get some carryover from the neighboring states right. We just did a deal in West Memphis, arkansas, which is obviously a carryover for Memphis, Tennessee.

Speaker 1:

The other thing that is available inside the state of Arkansas is vacant land deals. Vacant land can be picked up for very cheap and there are in buyers that are looking to develop there as well as just buy and kind of land bank and hold on to that land. And so we've done several vacant land deals from small quarter acre lots I locked one of those up live in Hot Springs when several years ago when I went live with King Kong and we've also done larger acreage deals. I think we've done up to 20 acres inside the state of Arkansas. So pay attention to the opportunity that exists with vacant land inside the state of Arkansas as well as the single family deals.

Speaker 1:

But ultimately over the past five years of wholesaling I put Arkansas in the top 20, despite the fact that its population is 33rd. And as we've been doing these breakdown of states, what we've seen is normally when the population is higher, ranking where it's in the 30s and 40s. I kind of feel like that's not a good area to wholesale in. This one really beats the trend here and kind of comes in that top 20. It's pretty close to the top 10. The only thing I would say is that as a virtual wholesaler it's never going to contend with some of the states like Texas, missouri, florida, michigan, ohio, where we could get a lot more leads and more volume. But when we do get leads and we get properties under contract, they're normally very profitable. But just like the other states that you have to pay attention to those as-is comps, the prices are a little bit lower. Your assignment fees are going to be lower. I'm not saying we haven't had some bangers in Arkansas. I think the largest assignment fee that we had was like $45,000, somewhere in that range. But the majority of the time we are ranging somewhere between that five to twelve thousand dollar range. That deal that we just did in west memphis I believe we made seventy five hundred dollars. That's pretty typical for what we've seen inside of arkansas.

Speaker 1:

Now, finally, I want to talk about the regulations inside of arkansas. There are some regulations, but the priority inside the regulation is making sure that wholesalers are disclosing that they are assigning their equitable interest and not marketing and selling the property. That is the priority inside the regulation. Otherwise they feel like you're brokering and you need to have a real estate license. So inside of the language of your dispo marketing packet, if you have a disclaimer down at the bottom that says wholesaler is not selling the property as assigning as equitable interest, however you want to word that, just make sure it's really disclosing and disclaiming that you are not selling a property. You are assigning your equitable interest in a property that protects you, and that is what they were wanting inside the regulations in Arkansas. So really it's one of the easiest regulations to navigate with, because you should be doing that in all 50 states.

Speaker 1:

This is not like an uncommon thing. It's just now, with the red flags being raised around regulations and wholesaling. This is something that you need to pay attention to and, of course, you don't want to come across. You don't want to get in trouble. You don't want to get a fine or receive a cease and desist letter from the board of realtors or anything like that, inside the state of Arkansas. You just want to abide by this, but I would say, hey, why don't you just take the precaution and do that in all 50 states? Right, we're moving towards that direction anyways, where this is what they're mandating, this is what they're wanting us to do and it's really what you should be doing anyways.

Speaker 1:

So add that disclosure down at the bottom of your marketing on the deal and just make sure that the language that you use is only around assigning your equitable interest. You're not selling a property. Make sure that carries over in all of the language they use, whether it's a Facebook post, inside of text messages that you're not selling a property. Make sure that carries over in all of the language they use whether it's a Facebook post, inside of text messages that you're sending, and also the language that you're using on the phone. You never want to say the wrong language to the wrong person and you never know who's going to be a whistleblower on you. So pay attention to that language that you're using and you'll be protected. Overall.

Speaker 1:

My feelings about Arkansas is it is a great state to virtual wholesale in. There's normally in buyers available, of course, are there going to be super rural areas where it'll be a little bit more difficult to dispo? Yes, but that's the case in almost every state. What I would say is give yourself a little bit longer time and don't be afraid to reach out to the in buyers that are by the nearest large city to your property Because, like I said, what makes Arkansas a great market is the majority of time. Those end buyers are hungry and are willing to travel to buy those deals. So don't sleep on the opportunity.

Speaker 1:

Inside of Arkansas and I also have to say, out of all 50 states, arkansas is one of my favorite logos. We'll put it right here, jordan, throw out that logo. That is a white-tailed deer with apple blossoms coming off of his antlers. That is amazing. That is one of my favorite logos. I've fallen in love with wholesaling inside of Arkansas and I'm glad that we did that initial 50-day challenge where we could find out a great market, because prior to that I would have thought Arkansas would rank up there with a state like New Hampshire, which we talked about last week. But through the experience I've learned Arkansas is a honey hole. So go fishing in Arkansas, enjoy your travels there, close some deals. Let me know what you guys think about Arkansas and have you closed any deals there? Do you agree or disagree with my tape? Show me some love, like today's video. We'll see you guys, tomorrow.