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Three Easy Ways to Build a Wholesale Buyers List

by Stephani Davis on August 6, 2009 · 24 comments

  

Real Estate Buyers List for WholesalersWholesaling houses is much easier when you have a list of active buyers lined up ready to purchase your deals. I personally spend just as much time looking for deals as I do looking for buyers. I am always on the hunt for new buyers, and as a result, I am usually able to unload my wholesale deals within hours of putting them under contract.

The following is a list of my three favorite methods for locating new buyers. If you implement one or more of these strategies and follow through on a consistent basis, you will have yourself a nice, healthy buyers list in no time.

Here we go…

Building Your Wholesale Real Estate Buyers List

1) Handwritten Bandit Signs

This is, by far, the most effective strategy I use to find buyers.  I use 12×18 blank, white, corrugated plastic signs, and then write on them with black or red permanent marker. A typical sign reads like this:

CHEAP HOUSE
MUST SELL!
39k
CASH ONLY
123-4567

When I have a property under contract, I place between 10-20 signs in and around the neighborhood of the property I am selling. This always gets my phone ringing, and I usually pick up at least one new buyer every time I put a batch of signs out. If I don’t have any properties of my own to market, I will call a few of the other wholesalers in my area and ask them if I can market one of their deals.

If you don’t feel like putting the signs out yourself, it isn’t hard to find people looking to make a few extra bucks who will put them out for you. I am currently paying a high school kid $1 per sign to put mine out for me.

If you’re going to be using signs, make sure to check your local ordinances, as some areas have restrictions on where signs can be placed.

2) Search for recent cash sales in the MLS

If you want to know who the active cash buyers are in a particular neighborhood, do a search on the MLS (or have someone do it for you) for recent cash sales.

When I do my searches, I usually only go back 2 weeks, and I’m looking for the lowest cash sales in the neighborhoods that I am working in.

Once I get a list of the houses that have recently sold for cash, I take a drive out to each of the properties.  Nine times out of ten there is either a rehab crew on site, or a “For Sale” or “For Rent” sign in the front yard.

If there are people working on the house, I will stop in and introduce myself, and leave a business card.   If there is a “For Rent” or “For Sale” sign in the yard, I will call the number and strike up a conversation with the investor to see if they are looking for more homes in the area, and if so, what type of deals are they looking for?

I try and do this at least once every month, and I usually end up adding one or two quality buyers each time I do it.

3) Call “For Rent” signs in your target neighborhoods

When I am driving around looking at properties, I always have a pad of paper and pen on the seat next to me so I can jot down the numbers on any “For Rent” signs that I see.

Most of the investors I sell to are landlords, and calling “For Rent” signs is one of the best ways I know of to find more landlord buyers.

One of the first buyers I ever added to my list was found by calling a sign he had in front of one of his rental properties.  That was over two years ago, and he has since bought 7 properties from me, and is still looking for more!

I have been using the previously mentioned strategies consistently for the last 2 years, and have thus built up a strong buyers list of active investors to sell my deals to.  If you begin implementing one or all of these strategies starting today, and remain consistent with your efforts, you will have a list of active buyers in a very short period of time.

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{ 23 comments… read them below or add one }

M Realty August 6, 2009 at 10:58 am

Good ideas. I have never tried or thought of any of these. Though I do not really prefer the signs sitting outside, I think they are an eyesore in my neighborhood so I would never add more to the existing ones.

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derron August 6, 2009 at 1:08 pm

great info.will you write a article on generating leads on a shoestring budget?

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Joshua Dorkin August 6, 2009 at 1:25 pm

Hey Derron, I think this article does explain how to generate leads with little to no budget . . . the only think that would cost much at all would be the signs, and those are quite cheap to make.

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Steph August 6, 2009 at 3:14 pm

Hi Derron,

Like Josh said, these are pretty cheap ways to find buyers. If you put the signs out yourself, it only costs about $1/sign. The other two will just cost you gas money and time.

If you are talking about finding seller leads, I recommend the mls. You will need money for a deposit, but other than that, it won’t cost you anything to make an offer, and you don’t need to cough up the deposit until your offer is accepted.

HTH,
Steph

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Jacinth August 7, 2009 at 1:38 am

Very good information. I have herd this before from an individual in Florida that does it in a very similar way and has been very successful.

Thanks for sharing the information.

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Michael August 7, 2009 at 2:57 pm

I used “ugly yellow signs” to generate mortgage business and to sell and buy houses. I’d get the bright yellow ones and write the message with a thick black Sharpie, and not very neatly. Sometimes the signs would generate more calls than I could handle, particularly in certain areas.

I had to pay some fines for nailing them to telephone poles but it was worth it.

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J. Lamar Ferren August 7, 2009 at 9:24 pm

This is why I love Reading Steph’s content…Because that’s exactly what it is…Pure Content that you can use now! Thanks Steph!

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Warren Goldman August 11, 2009 at 10:42 pm

Good post! I hadn’t quite thought of generating leads in this way before, but a new approach is always helping when wanting to expand avenues.

Thanks for posting, and I look forward to your updates!

Warren

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Steph August 19, 2009 at 3:49 pm

Hey Daneel,

I just tell them them I saw their sign and was wondering if they were looking for any more rentals in the area. If they say yes, I ask them what type of properties they are looking for, and how much (ballpark), they are willing to pay.

Then I head to the mls and start making offers on properties that fit their criteria..

Hope that helps,
Steph

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Daneel August 19, 2009 at 3:20 pm

Hey Steph! Great post, question what exactly do you say or(pitch) to these landlord to get them as a new buyer?

Thanks hon!

Daneel~

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ron August 26, 2009 at 9:06 am

i wrote you because i have a site that can help me make short sales and they told me i need a end buyer to complete the deal so i’m looking for investors i know a good site for fourclosure so i was going to send you some properties and see if you like them maybe we can make some money

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Anthony August 27, 2009 at 5:16 pm

Stephani,

Learning about what works and what doesn’t is a godsend. Thank you.

Anthony

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Joe Ziolkowski September 10, 2009 at 11:52 pm

Steph, thanks so much for writing this. This is one of the best, most helpful articles I’ve read on this site so far (not that they aren’t all great). I’m going to put these into practice tomorrow! Two questions though. 1)At any point in talking to the landords/renovators, do you mention that you’re a wholesaler or explain the whole assigning rights/not selling the property thing? And 2) when you advertise for another wholesaler like that are you getting a piece of their action, or just helping them to help yourself? Thanks again, great stuff!

Joe Ziolkowski
Homestead Property Solutions
708-476-3290

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Stephani Davis September 11, 2009 at 8:50 am

Hi Joe,

Glad you liked the article..

Yes, I always tell the landlords/buyers that I am a wholesaler. Most of them know the drill so I usually don’t have to explain much. I just tell them I’ve been getting some great deals in the area and am looking for more buyers.

When I work with other wholesalers I get part of the profit if I find a buyer. I have 2 or 3 guys that I work with quite often and we are always partnering on deals. If you aren’t licensed you need to be sure to have the properties under contract or option so you don’t get in trouble for brokering without a license. If you’re licensed, you can just get paid a commission on the HUD..

HTH,
Steph

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Joe Ziolkowski September 11, 2009 at 9:11 pm

Thanks again Steph. Sorry to be asking a hundred questions here, but when you say have it under contract or option, doesn’t the other wholesaler already have it under contract? So would you have a seperate contract, or get in on the original contract somehow? Sorry if it’s a stupid question, but I’ve never seen that type of deal done before :) Thanks!

Joe Ziolkowski
Homestead Property Solutions
708-476-3290

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Stephani Davis September 11, 2009 at 11:37 pm

Hi Joe,

Yes, the other wholesaler has it under contract, so you can do a double assignment (they assign their contract to you, and then you assign it to your buyer), or, if it’s a bank deal that can’t be assigned, you would put it under contract with the wholesaler and then assign that contract to your end buyer…

I’ve been involved in deals before where the contract was assigned 3 times. It can get messy when there’s that many people involved, but it’s possible to pull off if you know what you’re doing. :)

Steph

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Norm Whitehurst October 5, 2009 at 7:11 pm

I think this is a great way to find buyers, and I thank you for your help.

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Janet November 19, 2009 at 11:16 pm

Well it is really a great way to find more buyers but by doing this we expect that there are lot of frank callers that we receive everyday. Do you have any tips on how to make sure or to figure out if they are really a good buyer?

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Dave February 1, 2010 at 12:13 am

Steph,
The info you provided in your recent articles is very insightful and helpful.
My wife and I are just beginners. We own 3 properties and have another under contract.
Unfortunately, BOA has been dragging their feet on our short sale offer (4+ months so far),
but that has given us time to look (unsuccessfully) for a buyer or a JV partner.
You would think that with $90K+ in equity (pre-rehab) that finding a buyer would not be too hard, now would you? Well, we’re sure having trouble. I’m going to try some of your ideas for finding buyers, they all sound very workable and productive. Thanks for the tips. By the way, if you know somebody who wants to make $50K in the next three or four months, please send them my way.
Thanks again for the great tips!
Dave @ Creative Housing Solutions, Leadville CO

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Jake November 29, 2010 at 3:46 pm

Great Advice Stephanie-
Do you target/prefer nice neighborhoods or rehab/low income areas to wholesale properties?

Thanks!

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Joe Ziolkowski November 30, 2010 at 9:06 am

Hi Steph,

Just an idea, but I think if you were to record a few conversations that you have with the “for rent sign” landlords, about a zillion people would probably watch that :) Also a p.s. to anyone reading this and wondering, these ideas do work. It’s a numbers game, so be prepared to hear some no’s. Just don’t get discouraged. It gets easier with time.

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Ronald Cagape October 31, 2011 at 4:07 am

These are great tips Steph. Article was posted a few years ago but still remains relevant. Hand-written bandit signs are really good. Tarpaulin signs are now very cheap where I am and they consistently generate a good flow of leads.

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Kevin March 27, 2012 at 2:13 pm

Another great way to build your buyers list is to post ads on Craigslist, Backpage, and Ebay Classifieds looking for cash buyers. This gives me a solid 3-10 new buyers per week.

This method mostly gives you a quantity of buyers. If you are only looking for a few quality buyers, REI clubs/meetings are the best way to meet these buyers/investors.

Reply

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