I want to share a story that just happened - I literally just got off the phone with a wholesaler, and there are some powerful lessons here about relationships, negotiation, and deal-making that I think you'll find valuable.
The Power of Long-Term Relationships
This wholesaler is actually a great friend of mine. We've had a solid relationship for three years now. I met them when I was 25, just starting in real estate, during one of my trips to Milwaukee to see investments in person. What struck me was that they were around my age - not many players in this space were 25 when I started.
Here's the first key insight: Play long-term games with long-term people. This is a quote by Naval Ravikant, and although I didn't know Naval back then, this is exactly what I did. I found people who were going to stick around for years, invested in relationships with them, knowing these relationships would compound over time.
Here's the crazy part - over these three years, I never did a single deal with them. Zero deals. But we stayed in touch. Every time I came to Milwaukee, I'd see them. They're a couple who have since moved to Texas, and they're incredible people. I appreciate their business acumen, enthusiasm, energy, and intellectual approach - qualities that are crucial in partners and cooperations.
How the Deal Materialized
About a month ago, I was looking for a new deal in Milwaukee and had a conversation with them. We talked about life - they were moving out of their state, I was moving out of my country. Personal stuff that matters when you're friends.
I mentioned how difficult it was becoming to find good deals - the market had changed, opportunities were scarce. That's when they started sending me deals. Initially, they were all in bad areas, which I explained wasn't where I buy. But here's what's important: I showed them my entire decision-making process, my numbers, my criteria. I was transparent about what would make me buy versus pass.
About three or four weeks ago, one of them said, "You know what, Dan? I think we might have something for you. There's one seller we've been in touch with. Let me check."
They went quiet for two weeks. But when they came back, I was the first to know about this off-market deal. They didn't post it anywhere else. They came straight to me because they knew I would buy if it met my criteria. They had my proof of funds, knew I was serious, had seen me buying in Milwaukee consistently.
The Importance of Being First on the List
This brings up another crucial insight: When working with wholesalers, you always want to be first on their lists. If you're not first, you're not getting the good deals. Number zero on their list is themselves - they buy the best deals they find. Number one should be you. If it's not, someone else is getting all the good deals, and by the time opportunities reach you on Facebook or other platforms, you're looking at deals with problems.
Negotiating in My Terms
I put this property under contract, but in my terms - which was significant because they usually don't do inspection contingencies. They typically require $5K upfront, non-refundable earnest money. But I don't risk my investors' money on non-refundable terms. I need to inspect properties with contractors and inspectors.
This time, I secured 10 days inspection contingency at a price and terms I was comfortable with.
The Current Negotiation Challenge
Here's where it gets interesting, and why I wanted to share this real-time. We love this property, but at $205K, the price feels too high. Not extremely high - we could make it work - but it puts us at risk of losing money if we had to sell within the first year for any reason.
So I called the wholesaler and said: "We want to buy this property. We're buying in cash and can close in seven days" - words sellers love to hear. "But we need a lower price. Can you ask the seller how much he will be willing to take for this property?"
Negotiation Insights
Notice the specific wording: "How much will he be willing to take?" Not "receive" - because he'd be willing to receive $1 million. This is extremely powerful language that I believe comes from Chris Voss's "Never Split the Difference."
Also crucial: I didn't reveal my target price. Maybe the seller will take less than what I'm thinking. Maybe he has no room for negotiation and $205K is his final number. I don't want to expose my number unless absolutely necessary because my number doesn't matter - what matters is what the seller is willing to accept.
The Walking Away Position
Here's my concern in this negotiation: I'm not sure I'm in a strong position to walk away from this deal. If you can't genuinely walk away from a negotiation, you shouldn't participate because you'll lose. The $205K price is maybe good enough, and I might not want to give up the deal for a 5% difference in pricing. This puts me in a weaker negotiating position.
My target is around $195K, potentially even $190K, which would make this a strong deal even if we had to exit quickly.
Key Takeaways
- Build long-term relationships - they pay off in ways you can't predict
- Be first on wholesalers' lists - it's the difference between good and mediocre deals
- Ask open-ended questions in negotiations - don't assume anything
- Don't reveal your price first - let the other side show their hand
- Only negotiate from a position where you can walk away
- Use precise language - "willing to take" vs "willing to receive" matters
This is negotiation in real-time, 30 seconds after I finished the call. The relationship I built three years ago is now potentially delivering my next great deal.
Feel free to ask any questions in the comments, and don't forget to join my audio newsletter at danshimony.com.