I'm looking at the options to grow my capital, so I'm curious what the veterans think. If you needed to make some quick cash, especially working with a hard money lender or another investor, is this a route YOU would take? Why or why not?
I've heard some investors say that wholesaling is the be all end all of starting out in real estate with no startup capital, while I've heard others shame it as being underhanded.
Would you consider it underhanded to go out and find motivated sellers, negotiate a deal, and sell that deal to an investor with the capital (at a good discount, obviously, I wouldn't offer another investor something that they couldn't make at least $20,000+ on) or would you consider it a prudent way to get familiar with the markets and networks, with minimal asset liability?
If you've got any experience with wholesaling, I want to hear your opinion please, and your favorite story if you have one to share!
I'm not a pro, but I can still give a little insight.
I don't know if you've listened to the podcasts, and anyone that says that you have to be good at almost everything in order to do wholesaling, they're right. You need marketing to generate the leads, negotiating to follow up on the leads and get the price you need to make the deal work, while also working for a flipper. You have to be good at contracting and making sure they are legal. Then you have to be good at marketing the property to flippers and showing them the inherit value in your property.
Beyond this, I'm starting to see that wholesalers have a really bad rap for just trying to take people's money. Sure, I'm here to make some capital, but my overall objective, and the only way to survive I'm seeing is to be honest. You're there to help the seller with a problem. I highly recommend BP podcast #2 with Sharon Vornholt. She has a lot of great info.
Anyway, I'm a beginner too, but wholesaling is definitely a lot to take in at once. I've just made some deeper developments on my first deal, and I'm terrified.
I’m a wholesaler it’s a great way to get in the game but you do need money to start ( if you want to do it the right way ) start a direct mail marketing funnel and you need to be good at sales and talking to people...if that’s not your strong point hook up with a reputable wholesaler in your market that can bring you deals and just focus on fix and flipping... if you get in the fix and flip game you are essentially a project manager
good feedback... the only reason people say its the way to start is becasuse anyone can do it.
but very few actually succeed. you need money to create leads.. you need Uber sales and closing skills and then you need basic contractor skills you need to understand how escrows function and you need the time to do all that..
I don't know for the life of me why people think its the way to start in real estate when you have no money..
But if you can sell cars successfully you can sell real estate.
if you have 5 to 20k liquid to pay for marketing you can start.
if you can go 30 60 90 days or longer with out getting paid you can start
if you have a decent vehicle and afford gas you can start.
if you know how to do an escrow that helps
just much more too it.
the negative you get is that many get desperate or it simply attracts the less than ethical folks because no license required and in some markets were they prey on the not so bright owners they can really abuse them... its a fine line for sure..
not to mention its illegal the way most do it in most states.. just because they don't get caught does not make it legal.
assigning contracts OK.. makreitng a house you don't own on craigslist usually requires a licesne
But in my mind if your sharp enough to be a good wholesaler you can also be a good broker or anything else you choose to do.