The Pivot from Wholesaling to Residential Assisted Living

The Pivot from Wholesaling to Residential Assisted Living

Pivoting from wholesaling to residential assisted living requires looking at investing from various vantage points. 

There are two clear categories most investors fit into, the pragmatist and the opportunist.  

The pragmatist is by nature pragmatic – dealing with things sensibly and realistically in a practical manner.  

These people conduct business based on the information available and function well by doing so.  However, pragmatists often lack a dreamy spirit.  

Which means most of the time they are mission focused, not visionary-focused.

The opportunist is by nature – one searching for that which is coming, yet to be realized, in hopes of being the first to bring it to market.  

These people have pragmatic ways, but maintain an eye on what is coming, what will be needed, and who will need it.  

They are often early adopters and like the chance of bringing something to market first.

COVID-19 has changed America – essentially, we have been changed for good.  

There will be no return to the days prior to coronavirus.  

Truthfully, people tend to yearn for a “return to the good ‘ole days,” because they lack vision for the coming days.  

As an investor with experience in wholesaling, flipping, managing property, attempting to operate in the real estate market will be different.

Now, COVID-19 has made it an even more unique opportunity.  

Here is a public service announcement, there will be no return to the pre-COVID-19 days. Therefore, put on the opportunist hat.  

It has a far wider brim than that worn by the pragmatist, and it will certainly provide much needed shelter from the sun.

While resting under the brim of the opportunist hat, you will find opportunities.  

A skilled real estate investor will find their training and experience transferable into the wonderful world of residential assisted living.

Here, the experienced real estate investor will find helpful information to make a necessary pivot from the pre-Covid-19 days to the new world.  

Opportunities are abounding in the RAL industry and this is a great time to engage.

THE REALITY OF THE MOMENT

Clarity in this moment is essential.  The markets are turbulent, and the lack of expectancy is driving it.  

This reality is coupled with the personal challenges many American families are facing in terms of potential loss of jobs.  

Fear is governing many decisions being made right now.  

As a real estate investor, this present market situation is detrimental to the standard model of doing business.  

One cannot reasonably operate a real estate investment business successfully in this current environment for much longer.  

Traditionally, the seasoned investor would shift focus.  

  • Curb the level of renovation in homes purchased via wholesale.

a)    The idea here is to shave the cost of rehab to cover profit margins that will likely shrink upon sales.

  • Wholesale more homes as opposed to renovating.  

a)     The idea here is to avoid inventory, thereby reducing the chance of being stuck with a renovated home that cannot be sold.

  • Take the rental route.

a)     The idea here is to:

  • purchase cheaply, do minimal repairs and then rent it.
  • convert existing inventory into family rentals.
  • turn upscale inventory into Air B-n-bs.

b)     Essentially, become a landlord.

These shifts were successful pre-COVID-19.  Such shifts are not so ideal during this pandemic and may not be for many years afterward.  

So, what does a stellar real estate investor do in these times? First, you have to really see what is going on.  

Due to a plethora of reasons, actions and inactions of both the government and the citizenry, COVID-19 is actually gaining ground.  Here are some hard facts concerning May/June 2020:

  • High unemployment will persist. Furloughs are ending, and most people are not being invited back to their old jobs.
  • Stimulus money has run out for many recipients.
  • Extra unemployment benefits are expiring in 4 weeks.
  • PPP program expires at the end of July.
  • An impending second round of corporate layoffs.
  • Commercial Real Estate (CRE) awaits its bludgeoning.
  • Residential Real Estate will likely have to dance with a similar partner as CRE soon. 
  • Persistence of COVID means single economy towns/cities are at grave risk: 

a)     Las Vegas and other entertainment rich cities

b)     Orlando and other amusement cities

c)     College towns

d)     Myrtle Beach and other resort towns

  • Massive financial pressures on state and local governments to continue to fund their operations.
  • Continued stock market fluctuations.
  • Difficulty in the federal government in terms of funding another stimulus package. 

All seems dire, adrift and demonstrably destitute. This is the pragmatist’s outlook. Put on your opportunist hat – now.

It is often said, “What is a crisis for some is an opportunity for others.”

You must pivot.

Stand upon the toes of your mind, turn in another direction, widen your vantage point, and engage.

You cannot do what you have always done and get the same result. 

However, you can use the experience and skills you’ve gained along the way.  

Here are some clarifying statements:

  • Wholesaling does not need to cease.  The pivot is to move from wholesaling to other real estate investments with the outlook of renovating for a different market. You are pivoting to another market, the RAL Market.

a)     These investors are in search of properties that can be renovated for a completely different purpose.

  • Buy and hold has not ended. The pivot is to prepare the property for a different type of client.  This client has far different needs for the property than your client purchasing a starter home for resale.  These investors are looking to provide a dignified finish for their clients. A residential assisted living home is what baby boomers want for their golden years.
  • While Air B-n-Bs are wonderful accommodations, not many people are travelling at the moment. In addition, they will not be travelling in large groups during the foreseeable future.  Travel restrictions may become a part of American life for many years to come. Do not fear. Start Renovating for the aging, not the travelling.    

Since you are becoming accustomed to the pivoting motion, to thinking, existing and operating like an opportunist, why not consider yourself.  

Think about it.  

What made you want to be a real estate investor in the first place:

  1. Freedom:  the opportunity to spend more time with family and friends. 
  2. Adventure:  the opportunity to travel/vacation more often and for longer periods of time.
  3. Knowledge: RE investing expanded your knowledge of the most basic of living needs, housing, and all of the facets involved in bringing the American dream to so many.
  4. Money:  you did not engage in RE investing to be charitable.  You wanted to create generational wealth.
  5. Taxes: it is no secret that the tax code gives deference to those who provide housing for others.  These benefits make it possible for you to do this.
  6. Skill Development: from construction to contracting, from financial analysis to finish-outs, you have developed skills that are invaluable.
  7. Accomplishment: there is nothing like finishing a renovation, marketing a home, and witnessing a family move into that property.
  8. Contentment: RE investors typically say that working in this industry resolved unrest and the valueless nature of corporate jobs, making them more satisfied with their lives.

These reasons and even more are achievable by learning, understanding and becoming an investor in the residential assisted living industry.  

Why should you do this? What makes this industry different from traditional Real Estate?

The residential assisted living industry is currently focused on the one demographic in American society that has money – baby boomers.  

Many have retired or will be shortly.  

Their retirement funds have long been moved into more conservative investments where yields are lower than stocks, but loss is not realized.  

Many baby boomers, as we often refer to this generation, are beginning to have needs that require attention. 

The assistance they need cannot often be given to them by their adult children.

However, this generation is repulsed by the traditional senior housing or big box nursing home facilities. 

The big box facility just will not work for them.  

However, a RAL home is absolutely the most ideal situation for baby boomers and their adult children.  

Make the pivot, now.  

TRAINING OWNERS AND OPERATORS AT RESIDENTIAL ASSISTED LIVING ACADEMY 

Get the clarity you need to provide homes for residential assisted living investors and become one yourself.  

Why not? 

You are already in this space and the RAL Academy will show you step by step how to maximize this opportunity to net profit $5,000, $10,000 and even $15,000 per month. 

Simply pivot to the clients who have both the money and the need.  

However, you must learn the right model of assisted living first.  

Just as you did with real estate investing, you must do likewise with your RAL business.  

Join us now, and Start your training today.