New investor purchasing from a wholesaler

[Jason Huff]

Do the veteran investors on this site generally recommend a new investor does/does not purchase a single-family home from a wholesaler for a buy/hold strategy?  My understanding is that wholesaler inventories move quickly and thus, an investor must have a well-trained eye.  As a new investor purchasing my first home, I am skeptical I have the required acumen at this time.  

For reference, I am looking in the Atlanta area, have adequate financing, and am looking for low-stress purchases (e.g., no/low front-end repairs; turnkey properties).  I am particularly interested in hearing from non-wholesalers to avoid bias.

Any insight would be very much appreciated!!  Please also feel free to connect with me, as I look forward to establishing a network in the Atlanta real estate community.

[Jerryll Noorden]

Sadly, wholesalers have a bad rep.

THey force numbers, inflate ARV and under estimate repair cost. I hate to generalize but I see this all the time.

1)So the first thing you do is run the numbers for yourself, without ever looking at the numbers the wholesalers gives you.

2) Then Check his/her numbers, and find all descriptancies.

3) Ask the WS to explain their numbers.

4) Ask them if He/She has had a contractor give bids on repair cost.

4a) If yes, let them give you the bid

4b) if no, ask how they got to the repair budget. If they even dare to tell you they did some stupid formula like X amount of dollars/square ft, bish slap him/her 3 times call him "Shirley" and bish slap him 3 more times.

5) Ask him if an agent walked the place

5a) If yes ask him/her for the comps

5b) if no, see 4b)

6) Run the numbers again, 

7) ask him how many deals they have wholesaled and if they can give you the reference of the buyer (this may be tricky)

The reasoning behind this is, if the previous buyer is a repeat customer, good thoughts! If not... hmmmm

8) If all works out this may be a winner wholesaler and keep his info.

I know this is a hard list to complete, but... see if you can complete as many point as possible.

That'll be 3 virgins and a cow!