Pete Christianson had an interesting start to his real estate investing career.
After losing his job Pete’s church pastor suggested that he look into wholesaling real estate.
Although he had a real estate license, Pete never heard of wholesaling before.
Pete checked out local REIA meetings and immediately hit the ground running.
Watch as Pete talks about his early journey as a real estate investor and his first deal.
Transcript:
Pete Christianson 00:02
Awesome. Thanks for having me on.
Chris Bounds 00:05
Thanks for joining us. So your first deal you weren’t in Austin, you were somewhere else. Where were you? your pastor? I want to hear a little bit about that story, what that deal looks like. Let’s go.
Pete Christianson 00:17
Yeah, so we’re in Louisville, Kentucky, and I was meeting with my friend, Andy, pastor at the time. And I was like, “Andy, my company just laid me off, you know, I got this, I got a couple job opportunities on the line, you know, we’d have to move. I don’t think my wife would be very happy about that.
And I got this real estate license because I want to get into real estate, but you know, it just seems like a slow ramp up.” And he goes, “Have you ever heard of wholesaling?” And I said, “Well, I’ve heard of the term, but I don’t really know what it means.” Like, “What is it?” And so here’s me, a realtor who’s gone through real estate school, who doesn’t know what wholesaling is. So it’s just, it was like…
Chris Bounds 01:03
You’re not alone. 95% of agents out there don’t know what it is or if they think they do, they don’t really but…
Pete Christianson 01:10
Exactly! So, it was actually, he explained to me that you could get a property under contract, and then you have equitable interest in this property, and then you can sell your right to buy the property to someone else for a bigger price. And I said, “That’s legal?” And he said, “Yes!” And I go, “That’s incredible”. So he’s like, here’s what you need to do go meet with this real estate attorney, he’ll give you some contracts to buy and sell. And then, you know, go to the local RIA meeting. And I said, “Okay.” So I went on to YouTube and started looking up because I’m big on education, right?
So I’m not afraid to hire a coach or mentor, because I want somebody to help me get- I want to compress my timeline. I can figure it out on my own, but I’d rather have somebody who’s already done it, show me what they did, and I’d be happy to pay them for that. So, I went met with Harry, he was awesome. He gave me some purchase contracts and some encouragement and then he said, “Go to the RIA meeting”. So this is the second person telling me to go to the RIA meeting. So I go to the RIA, I’m meeting people and passing out business cards.
And my first deal came about through Brent Daniels, and I pulled a list from list source of absentee owners. And keep in mind, I met with Andy on April 23, 2019. I’m cold calling a week later. And I’ve pulled my list. And I’m calling these absentee owners 40% plus equity on the property for, you know, so many years, and they’re 44 years and older. So that was kind of the formula for that tired landlord list. So I get this guy on the phone named Don, just a nice guy, great guy. So I’m talking with Don, and I said, “Hey, Don, I was calling to see if you might be open to an offer on your property there on Merrick Avenue.” And he said, “No. No, I got someone living in that.
I don’t want to sell that one.” And I am part of the script that Brent teaches. And I said, “Hey, no problem, Don, I totally understand. Do you have any other properties you might consider selling?” And he thought for a second. And he goes, “You know, I have this one on Ben Franklin that I’d be interested in talking to you about?” And I’m like, “Perfect! When would you like me to meet you there?” Kinamon, I know nothing. Like I don’t know anything except what Andy’s told me what Harry’s told me. And you know, a few contacts I met at the RIA. So I go and I had this, you know, rehab checklist, my clipboard, show up, smile, shake his hand, meet his wife.
And he takes me through the house. And this was a house that they raised their family. So it’s a nice four bedroom, two and a half or two bath home. And Don and his wife had moved out to a condo to a patio home because they’re getting older, and I learned later that Don had some health challenges, and they were in the process of remodeling this house to flip it and put it on the market and sell it.
And so, it became clear after talking with me, and it became clear to Don that, you know, it might be easier to just take a cash offer on my house instead of go through the hassle of fixing it and waiting and I’d rather just not focus on this and so I wrote him an offer right there. And, you know, I got that- so we went back and forth for a day or two because his wife wanted a little bit more money. And so, we ended up settling to keep her happy and keep the deal alive. So I got the property under contract for $165,000, hundred sixty five thousand.
Chris Bounds 05:03
What kind of review at that time, what do you think it was worth? Like fixed up? Did they any?… This was a little while ago. So I’m trying to recall, I think the ARV was 275 or two, in that range. Okay, so 165 you’re on contract, think it’s worth 250. Maybe a little more. As far, what kind of repairs did you think it made? It needed?
Pete Christianson 05:32
Keep in mind. (inaudible) I wasn’t… Yeah, probably twenty-five-ish.
Chris Bounds 05:39
Okay 25. One-ninety-ish. (inaudible)
Pete Christianson 05:43
So it wasn’t like, Donya’s deal. By no means. But …
Chris Bounds 05:48
No,no, no. Okay, go ahead. It was an okay deal. And it was in a good neighborhood. And so it was in the nice part of town. So to met a great flip. So I called the guy who I’d met recently at the RIA. I knew he was a big time flipper. He had a company. He had some employees. So I called Eric. I said, “Eric, I got a deal.” Actually I called a lot of people, but they weren’t interested because in the market of Louisville at the time, they’re not used to paying that sticker price for a flip.
They’re getting them for closer to 100 and turning around and selling them for 200. But nonetheless, I didn’t let that discourage me. I called Eric and he was over at a restaurant in town. And he said, “I’m having lunch over here with my partner.” I said, “Great! I’ll meet you over there. I got the contract. I’ll meet you over there.” So I’m not letting any time get wasted because I wanted to sell this deal I want… You’re gonna make it happen.
Pete Christianson 06:44
Yeah, I wanted to go from faith to fact that this is a real thing called wholesaling, that you can make money selling paper. And so, I went and met him at this high top table and had him sign the assignment agreement. And I remember, he kind of beat me up a little bit on price I wanted to make 10 grand, and I was trying to sell for 170 something. And he’s like, I’ll give you one I’ll give you 175 and I’ll give you one 170 and I was like, “Ah, that’s only like five grand.” But nonetheless, I was like, “Cool”.
I know how close and so I was like okay, “Cool, we’ll do it.” And so at the restaurant, he’s like, “What did I say?” I was gonna- He almost wrote 7000 I was like, “No, you said five.” And I was just like, but it’s cool because I’m big on integrity you know, say what you do and do what you say. So he ended up closing and I made five grand and this was like from the time I heard about it to the time I got paid was like five weeks or something I bought and sold the deal in like 30 days, something like that. So, it was great.
Chris Bounds 07:49
I love that and sounds like you had a very financially astute and investment friendly pastor. I’m sure there’s more like that, it’s just that, it’s an interesting story. So, ultimately, you didn’t have a job, you had to get out there and do it. You got some advice, you followed up on it, took action, made it happen, walk away, fret it with five grand in your pocket.