Just Completed First Wholesale Deal

2 Replies

This is about pleasant persistence and working thru one's inexperience and mistakes.

Deal:

4 bed, 2 ba SFR, 1404 sqft. Total gut job. Place is a shell. ARV $375-$425 (depending on pool). Rehab $70K - $115K (depending on pool). Assigned at $245K.

I originally found the house after driving past it in April of 2018. I found the owner via county records, googled his name, found an email for him on his company architecture site. I emailed him a selfie of me in front of the property. The message was the exact truth: That I passed it on the way to my daughter's school one day. That I wondered if he might be interested in selling it so that I could fix it up into a nice family home. I originally wanted to make it a rental or residence for myself.

Seller responded with one line: "What are you offering?" I made a very low offer and never heard back from him.

So I sent another email a month later, just checking back in. He declined my offer. Wanted more, but didn't say how much. One month later, I sent another check in email. He responded, saying he had other offers at $200K and could I beat that? I offered to match, and then raised to $212K.

He declined, saying he had plans in at the city and was going to rehab and sell it himself. So I just watched the property. A year later, it still had not been fixed up. So I sent another check in email. I reintroduced myself and reminded him I was interested. I did this two more times over two months before he finally just said: "$235K and it's yours."

I got it locked up at $235K. Then a different house I'm working on in FL went from 7K in repairs to over 25K in a week. I no longer had the money (or the time) to fix this local property up into a rental. I decided to assign the contract. I am not a wholesaler, I had no cash buyer list. So I reached out to every element of my network I could. I posted to BP, Craigslist, and MyHouseDeals.com. I made a free Google Site with tons of pics, videos, and property info and shortened the link with Bitly. I text that link to every investor, realtor, friend, and neighbor I knew that had any interest at all in real estate. 

I eventually received offers from 3 different cash buyers. I didn't want to start a bidding war so I sent identical assignment agreements to them all and said the first buyer to sign and return the agreement got the contract.

In addition to the assignment fee I made, this process allowed me to gain immeasurable first hand experience wholesaling. My network of investors and cash buyers grew from 2 to over 75 in a two week period. In many ways I am thankful for the surprises at my FL property that forced me to make this pivot and become a better, more versatile investor.

Biggerpockets was a huge factor as I gained many contacts and advice. A special thanks to James McCoy at buysellfixflip for his help.

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