The thrill of securing your first real estate deal is unmatched. Whether you’re looking to fix and flip properties or build a rental portfolio, that initial closed transaction represents a monumental milestone on the road to financial freedom.
But for many aspiring investors, finding profitable deals feels frustratingly out of reach. Properties listed on MLS seem overpriced, while off-market opportunities remain shrouded in mystery. Where do you even start?
This is where the Elephant Challenge comes in. Spearheaded by expert full-stack developer Pace Morby, this program aims to help participants secure their first deal through an accountability-focused framework centered around taking consistent action.
In this comprehensive guide, we’ll explore how you can leverage the Elephant Challenge to kickstart your real estate investing journey, with insights on:
- The motivation behind the challenge
- Key real estate concepts every investor should know
- The power of community for growth and support
- Practical strategies to find and submit winning offers
- Profiles of successful challenge participants
- Developing an investor mindset and grit
- Safeguarding against market risks
Whether you’re an aspiring or experienced investor, read on to learn how the Elephant Challenge can help unlock your first (or next) profitable deal sooner than you think!
Success Starts With Taking Action
At its core, real estate investing comes down to one thing: taking action. As Pace emphasizes, no amount of education or motivation will manifest deals out of thin air. You have to get out there and make offers, even if the sheer volume feels intimidating.
The Elephant Challenge tackles this paralysis head-on with an ambitious goal: for participants to collectively submit over 966 offers during the program.
This focus on consistent action has already catalyzed profound shifts for members. As Pace explains:
“This challenge has been nothing short of amazing for a lot of people…feeling confident, feeling motivated to move forward in their business.”
In fact, the rapid influx of activity from motivated participants forced the organizers to upgrade their server capacity! As Pace noted:
“I absolutely love it when we slow down servers because that means one thing – you‘re taking action.”
But this journey is not for the faint of heart. Even with a robust community holding you accountable, most investors will face waves of rejection before that first elusive deal.
Mike, an Elephant Challenge participant from Phoenix, submitted over 80 low-ball offers before finally getting one accepted. Lindsey from Atlanta bid on over 40 properties before acquiring her first rental. Chris from Vegas had to navigate nearly 100 vacant homes before finding one worth wholesaling.
Their perseverance paid off. But cultivating true grit as an investor means embracing the volume game. Set a goal to submit 5 offers per week, then hit 10, 25, 50 and up from there, continually stretching your comfort zone.
The Elephant Challenge accelerates your progress with an enthusiastic community collectively reaching for over 6,000 offers per day by this year’s end!
Band together, get skilled at efficiently analyzing deals, create systems to streamline the process, and let perseverant action lift you up.
Learn Key Real Estate Concepts
While tenacious action may be the engine of investing glory, education provides the essential oil keeping things running smoothly. Understanding market dynamics and essential financial calculations allows you to accurately evaluate deal potential.
The Elephant Challenge accelerates this learning process with training resources covering concepts like:
ARV (After Repair Value) – As the potential resale value of a fixed-up property, your ARV projections inform acquisition offers and expected profits. Investors typically target 65-70% of ARV minus repairs.
Comps Analysis – Thorough “comparables” research analyzes similar sold and listed properties to establish average days on market, $/square foot, optimal features etc for accurate ARV estimates.
70% Rule – For flip deals, your max offer would be 70% of ARV minus estimated rehab costs. At resale with 30% profit margin, repairs should not exceed 30% of your eventual sales price.
Rehab Costs – Rough estimates can use $100-150 per square foot for flips, calculating lower for more cosmetic updates. Plug these numbers into your 70% Rule calculations.
Creative Financing – Strategies like lease-option contracts, seller financing, and subject-to deals open doors for new investors lacking cash and credit.
As Pace explains:
“When you understand the fundamentals, that‘s going to give you the confidence to be able to raise your hand and say ‘Yes, I can get that deal done’.
The Elephant Challenge coursework instills this comprehension vital for accurately assessing potential deals.
Recent Policy Changes Impacting Investors
While historically low interest rates have kept the housing market red hot in recent years, the winds are shifting. Here is the latest 2023 policy update aspiring investors should note:
Interest Rates – The average 30-year fixed mortgage rate has spiked from 3% to over 7% as the Fed battles inflation. Expect rising rates to cool demand and pad numbers for fix-and-flip plays.
Eviction Moratoriums – Federal and state bans enacted during COVID are finally expiring, freeing up landlords to evict non-paying tenants to refresh rents.
Short-Term Rental Regs – Cities like Denver and Portland are tightening regulations around investor-owned Airbnbs. Factor policy changes into buy-and-hold rental plays.
While increased rates raise borrower hurdles, the expiry of pandemic protections bodes well for investors. Run the numbers using the Elephant Challenge training when assessing deals.
Find Profitable Niches Within Hot Market Cities
Not all real estate markets are created equal when it comes to investing potential. The Elephant Challenge focuses participant efforts on metro areas seeing surges of activity from both new and experienced investors.
As of 2023, some of the hottest big city markets include:
Dallas Ft.-Worth – Over 205 closed wholesale deals last year. Features major job and population growth plus affordable housing even amid the boom. Focus on turnkey or lower-tier flips.
Philadelphia – Rife with orphaned row homes and gentrification plays. Scope out properties needing renovations in improving neighborhoods for fix-and-flips targeting hipster buyers.
Cleveland/Columbus – Appreciation plays plus solid cash-flow potential with relatively low buy-in costs. Search for SFHs or multi-families just below market averages ripe for boosting.
Indianapolis – Investor-friendly state laws, strong job market, and housing 40% cheaper than the national median. Lots of off-market rehab opportunities.
The Elephant Challenge provides tailored coaching for finding profitable niches and deal types to pursue across various high-potential metro regions experiencing investor influxes post-pandemic.
Uncover Off-Market Deals With Privy
Finding profitable on-market deals listed on MLS often requires perfect timing or unrealistically high offers that squeeze margins. This is why sourcing off-market deals is so essential for many buy-and-hold or fix-and-flip investors.
Yet uncovering these hidden opportunities has long seemed more akin to art than science, relying primarily on extensive networking efforts.
The Elephant Challenge aims to systemize and streamline off-market deal sourcing with Privy – an innovative software putting these hidden properties within reach. As Pace raves:
“Privy is an amazing tool you can use to start looking for vacant properties that need some love…to submit offers on deals before anybody else can see them.”
Here are some examples of what Privy equips investors to do:
Property Search – Instantly scout any location to uncover vacant, neglected, or run-down homes showing signs of distress that may signal motivated sellers.
Owner Research – Dig up contact information on any property owner for direct outreach to make unsolicited offers on sites not publicly listed.
Market Analysis – Pull recently closed comparable sales and active listings data to accurately estimate After Repair Values and gauge repair budgets.
Automated Reporting – Get customized email alerts on new distressed property listings matching your buyer criteria in targeted zip codes.
As Privy user Maurine explains:
“Being able to have all of the information in front of me in seconds helps me analyze faster and submit more offers in less time.”
This unparalleled efficiency allows investors to swiftly jump on score hidden off-market opportunities.
In one demo, Elephant Challenge coach Benson leverages Privy to uncover and fully assess a vacant property for sale in just over 30 seconds – demonstrating the immense time savings the software provides.
Take That First Step With An Accountability Team
When initially launching your real estate investing efforts, the learning curve can feel completely overwhelming. Where do you start? Who can you turn to for advice when inevitable questions or hiccups arise?
The Elephant Challenge helps aspirants combat this isolation through a built-in accountability framework. Participants are matched with an experienced “squad leader” plus a small group of peers progressing through the same debut investing hurdles.
You’re also welcomed into the rapidly growing Elephant Challenge social media community of over 1,500 members. Within this private Facebook group, new investors can access:
- Direct messaging threads with vetted successful investors open to questions.
- Zoom hangouts to meet community members across the country.
- Locally organized meetups to view potential projects or properties.
- Motivational posts from members celebrating wins or sharing progress.
- Tips & tricks for evaluating deals, estimating repairs, submitting offers etc.
As Pace explains, this peer-driven support network is purposefully structured:
“My goal is to put you in a group with leaders from the sub-2 squad who can provide that insight, encouragement, and accountability.”
Having an engaged community as your support system makes the entire investing journey far less intimidating. You’re on this path together!
Adopt Habits and Mindsets Of Successful Investors
Between cutting-edge deal-finding tools, extensive educational resources, and accountability teams, the Elephant Challenge provides every component needed to secure that first triumphant real estate score.
Well, almost everything. Maximizing your odds still requires embracing the habits, behaviors, and mental approaches of profit-driven investors.
Here are a few key traits to cultivate:
Specialize Expertise – Rather than dabbling lightly across niches, become a dedicated specialist in areas like fix-and-flipping or buy-and-hold rentals based on available capital. Master your chosen craft.
Internalize Buyer Preferences – Study your ideal buyer avatars, whether end-user home owners or out-of-state turnkey investors. Cater to their location interests, must-have amenities, preferred price points etc when acquiring properties.
Move Swiftly – Slow feet don’t eat! In hot markets, housing inventory gets snapped up quick. Have your offer templates and comps analysis ready to pull the trigger.
Create Systems – Codify routines around test driving neighborhoods, estimating construction costs, submitting offers etc so wheel reinventing becomes minimal.
Continual Learning – Consume blogs, books, meet-ups and podcasts across your niche to stay atop latest strategy shifts and market trends.
Transforming into a savvy investor won’t happen overnight. But surrounding yourself with the Elephant Challenge community committed to mutual growth expedites the evolution.
Start Small, Think Big
When initially stepping into the arena, the sheer breadth of information feels intimidating. It’s crucial to start small and focused.
As veteran investor Pace Morby always reminds newbies:
“Do yourself a favor – just forget everything else that you know or want to do someday in real estate, and only focus on one thing.”
This means identifying a niche – whether renovating single family flips, acquiring out-of-state rentals, or wholesaling to local cash buyers – then becoming a true specialist in that channel.
From this solid foundation, the portfolio potential expands exponentially. Construct a routine to submit 5 offers per week within your niche, then hit 10, 25, 50 and up from there, continually extending past your comfort zone.
And by joining the enthusiastic Elephant Challenge community, hitting these benchmarks happens collectively. Reach out daily for the motivation and accountability needed to keep striving. Leverage Privy to search smarter. Construct systems to analyze quicker.
The time is now. As investor Ilya Muromets wisely said:
“The best time to plant a money tree was 20 years ago. The next best time is today.”
Whether aspiring or experienced, implementing Elephant Challenge principles propels you to inevitable success by forcing consistent motion.
Your first deal awaits! What step will you take today?