There has been a lot of talk lately about selling your wholesale properties to your buyer’s list versus putting them on the MLS. There are several good things about both of these tactics. A lot will depend on whether you want to actually close on the property and hold it for a while as opposed to doing a double closing or an assignment of the contract.
Using the MLS to Sell Your Wholesale Properties
There is a lot to be said for having a large audience like you do on the MLS. In theory, there are a lot of real estate investors that look for properties there, and your deal will get “snatched up” in no time. I have had people tell me that they have been able to make more money on every property by using this strategy, and if it works for these folks then I am happy for them.
I just never found that to be true for me. Many newbie investors find an agent and have them look for properties on the MLS. This is their strategy for finding deals. If you are working with an investor/agent that really understands what a good deal is, then you will probably have good luck doing this. But what I found out pretty quickly was that most Realtors don’t understand wholesaling, and they don’t want to make a lot of low offers. And, the buyers that came to me from the MLS listing were more like retail buyers. They wanted a half dozen contingencies in the contract, repairs on an “as is” property, and most of the time they didn’t have a source for cash. In addition, they still had to figure out the financing end of the deal. In the end, ost of the buyers I found through the MLS were just a pain in the neck.
Now this certainly isn’t true for all real estate investors looking for deals on the MLS. In my area, we have a large REI group. These folks are savvy, experienced investors. It doesn’t matter where they find a deal, they are only going to pay a certain amount for the property. Typically it is only the inexperienced investors that over-pay for a property.
Do I Need a Buyer’s List?
Even if you close on all of your wholesale deals and then list them on the MLS, I believe that building your buyer’s list should be one of your top priorities. To be honest, it’s not even that hard. You can begin with your local REIA. After attending some meetings, you will figure out pretty quickly who the heavy hitters are. Ask these investors if you can put them on your buyer’s list. They will always say yes!
I love being able to call the cash buyers on my list, tell them I have a property for them, have them run out and look at it, and then have it under contract within the first 48 hours. I have closed many deals in 2 weeks or less start to finish. You can always use the MLS as your “back up plan”.
I would love to hear what works in your market. Do you use a buyer’s list or list your properties on the MLS?
Photo: nola.agentUsing the MLS to Sell Your Wholesale Properties VS Building a Buyer’s List by Sharon Vornholt