Starting out as a wholesaler

[Alex Johnson]

Hey guys. i’m looking to get started in wholesaling Real Estate here probably at the beginning of 2018. I’m in the northern part of Iowa. I’ve read some books, watched many videos. Even bought Clever Investors class on wholesaling. just was looking for some advice or anything really to help me get started out. Anything is helpful. thanks in advance!

[Aaron Mazzrillo]

I love how a bunch of guys with zero experience are saying how awesome these guru videos are. LOL

Wholesaling is all about deal flow. Get LOTS of leads, make lots of offers close a few deals. I don't know your market but here, it is maybe $100-150 lead cost. 15-20 leads to get a deal. So, you want to buy a house, you need to consider spending $2,500 or so per deal. Wholesale fees more or less average out to around $15K per deal. That is average. So, you want to make $100K, you need to close 6-8 deals which is going to cost you around $20K give or take a few grand. The better you get at marketing and closing, the better your numbers will be... but not always. Sometimes the market just messes with you.

I'm just shooting from the hip though. Those numbers are not set in stone and change every year, but over a 10+ year career, they probably are not far off the mark. I had one year where I made $18 for every $1 I spent on marketing. Didn't happen this year though. So again, the law of averages always puts things back in order. The more niche your list, the better your numbers should be. A super niche list with potentially highly motivated sellers can make you an incredible amount of money. And no, I'm not talking about absentee owners or foreclosures. Those are generic and dozens of people mail them they same crappy post cards and letters over and over again.

Your market is different. Your numbers will be different. But, probably not by much. Unless those videos didn't teach you a thing about being a closer. Getting the phone to ring is easy. Picking it up and buying a house for 50% of what the person on the other end paid for it just 5 years ago, that takes skill. That is a rare deal, but I closed that one just a few weeks ago.

Here is the best advice I can give you. Write it down and put it above your desk where you intend to work on your offers;

"Have no expectations." 

You don't know what the other person will do and you can never imagine what they will accept. I did buy a house for 50% of what someone paid for it just 5 years ago. I also got a guy to sell me a duplex and 2 houses for $1,000/month with no interest. Why did he do it? Not my mission to figure that out. He just did because I was the one making those offers.