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Posted over 9 years ago

Should I Wholesale to Get Into Real Estate Investing?

Should I wholesale to get into real estate investing?

I often see this question from new investors looking to drum up capital to start investing. My business partner and I started out with the same question and we decided that it may be our only option. Or so we thought. We bought a course from a guru who was going to teach us how to quit our jobs and make tons of money. We weren’t naive enough to think we were going to get rich quick. We just wanted to make enough money to get in to the game. So we received the course in the mail and got started digesting the information right away. Only, there wasn’t a ton of information. The course was dense with the theory and hypotheticals, but nothing for us to really sink our teeth into. We also fought with questions about ethics. Putting a house under contract with no intentions to actually purchase it felt like lying. We debated the legal consequences of not executing the contract. Was earnest money the only thing at risk? This was before we found Bigger Pockets, which answered a lot of the questions. We decided to put wholesaling on hold because we were uneasy about many of these questions. Talk and debate ensued between us for several months about our next step.

Then it happened. We found Bigger Pockets. We were instantly inundated with information from blogs, forums, and most frequently, the podcast. With all of the information we could want at our finger tips and many success stories all over Bigger Pockets, we knew that this was our way in! We built our plan, purchased lead lists, and wrote our yellow letters. I remember butterflies in my stomach as I dropped the first batch of letters in the mail. Finally we were doing…taking action! I think for most new real estate investors this is the biggest obstacle standing in their way. As you will find out, we had less than a successful wholesaling career. However, it was one of the most important things we did because it pushed us to action and that was key.

Wholesaling forced us to drive the city, learn neighborhoods, research county records, talk to cash buyers, and the list goes on. We were finally doing and not just talking. We began to build credibility among our peers of newer investors by merely taking action. We built many relationships that help us today in our current business model.

So did wholesaling help us start our real estate investing career? Yes, but not the way that you would think. For us it was a call to action. And that is really what separates those who succeed in real estate and those who never get started.

Our next post will include why we stopped wholesaling and other good ways to get into investing without coming up with cash.



Comments (3)

  1. You reeled me in and now I'm curious @John Cunningham 

    What niche did you end up going to? Did you guys land any deals wholesaling?

    Great post!


  2. @Ndy Onyido 

    Thanks for your comment. I don't know too much about Houston other than it seems to be an investor friendly city from what I have see around Bigger Pockets. On my next blog post I will elaborate more about our wholesaling experience and how it has helped us. But to touch on one thing that I have done that lead to us flipping our first property is volunteering time for knowledge. I did property walk-throughs for a flipper in the area and took pictures so that he could see more properties. In return I learned a lot about what to look for and got to see how some of the negotiations went down.

    thanks,

    John   


  3. Thanks for this piece. I am in a similar situation of what the best entry point is. However, mine is slightly different as I am currently researching fix/flip & tax lien/deeds in the Houston TX market. From your experience, what is the best business model for Houston TX market?

    Thanks