Starting wholesaling, no money, determined

2 Replies

Hi,

I have a previous post about how I am looking to become a full time real estate investor. Anyway, I have considered a few paths, learning to flip and wholesaling. Wholesaling seems to be more of the path for me. My girlfriend is graduating this may with a decently high paying job and also starting real estate investing with me, so we do have plenty of income. 

Anyway, we want to start wholesaling NOW. The problem is everyone suggests things like “but a website” or “direct mail”. Way too expensive and complicated for someone that is just starting this business. It’s like buying tools before you know how to use them. So, I met a very experienced investor at a meetup this past week. He suggested simply driving around and looking for “for sale by owner signs”. This is how we plan to start. Any other recommendations? 

It’s often mentioned that in this business you have 2 things that you can use, your money and your time. As of right now we don’t really have any money, but plenty of time. So how can we best use this time. 

Finally, I should mention that I am in no way opposed to marketing. I simply want to learn the business before blindly spending, and almost certainly wasting money. 

Thank you! This forum has been a huge help so far.

@John Hein I tried my hand at wholesaling back in the day. Decided I didn't like crawling around smelly broken down houses :) However! If I wanted to find distressed properties for either wholesaling or renovating I would first drive through the cheap older neighborhoods (NOT the older areas that used to be the nice expensive part of town) and pick one I liked. I would want it to be a neighborhood that I feel comfortable and safe working in, and also one that I see a lot of houses that haven't been kept up.

Then I'd block off 2-3 hours in the early evening, say 5-8pm and around 1-4pm on weekends. Go knock on the door of every single house. Bring custom printed post-it notes, or door hangers, and business cards that explain that you're looking to buy a house that needs to be repaired or updated. Leave the notes or hangers on the doors that don't answer. Leave the business cards with the people you speak to.

Your script should be something like this:

"Hi! I'm John and this is my girlfriend (name). We're looking to buy a house in this neighborhood that needs some work. Do you know of anyone who's thinking of selling?"

Keep good notes and enter it all into a spreadsheet or CRM from your phone while taking breaks. Also use your phone to take pictures and notes of any houses of interest like for rent, for sale, or particularly unkempt or possibly abandoned homes.

There are several things you want to keep track of so that you really get to know the neighborhood well:

1. Real estate professionals working the area. This includes realtors, property managers, and other investors. These are all potential partners.

2. Contractors who live in the area. Electricians, plumbers, painters, cleaners etc. These people could become your buyers, tenants (if you get into buy and hold), or workers for yourself (if you start doing renos) or for your investors. They also make excellent bird dogs.

3. Other people who work in the area. Mail carriers, meter readers, dog walkers, landscapers etc. More bird dogs.

4. Anyone you had a positive conversation with. These are good neighbors who would like to see improvements in their neighborhood. They also make good bird dogs and once you prove yourself with getting that first house all cleaned up they will become your local cheerleaders!

5. Doors that didn't answer so you can make sure you try them again at different times/days.

6. Anyone who told you NOT to call on them again. In my experience if you're friendly, non-pushy, and seem genuinely interested in improving the neighborhood, most people will be nice. But you don't want to bother people who are really not happy about you knocking on their door, so maintain your own "do not contact" list.

Keep note of everything you can. Get names and make notes to remind you of where you met them (their house?) what they look like, and any other details (pets, children, personal interests). I'll explain more below.

I would focus on an area that's no more about about 1,500 houses. That's because if you're reasonably fit you should be able to comfortably door knock 100 houses a day and cover the whole neighborhood in 1 month (keep in mind that you may have to go back and knock on no-answers 3 or 4 times to get someone). Then you start over again next month!

Remember all those good notes you kept? They're going to become invaluable as time goes on. You can now greet those people you met with their name, impress them that you remember their son broke his arm last month playing ball or that their dog is a pitbull-poodle mix, and remind them of the conversation you had about that run-down house down the street.

Well...that's about all I can think of at the moment. Hope it helps! Good luck!

@Doug Pretorius

Than you for the reply. I am definitely open to this, just have to find the right place. Don’t want to door knocking in the ghetto honestly. But I agree that I think this is one of the best ways to get started. Thanks again 

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