Petition for BP to Discontinue Wholesaling Discussions...
Brandon SturgillBusiness Member
Real Estate Broker · Columbus, OH · Member since 2013 · 3k+ posts · 1k+ votesPetition for BP to Discontinue Wholesaling Discussions...
Most Popular Reply
Residential Real Estate Agent · Orlando, FL · Member since 2015 · 139 posts · 106 votes
11yI'm not sure why I'm even responding to this insulting post but since you've hit a nerve, I'm going to try. Wholesales and wholesalers are an intricate part for many investors. Considering we move 30-50 properties a month to our investors may show that wholesalers play an important role for many investors. We work to provide quality investments and take over all the hard work and time it takes to acquire properties for our investors that don't have the time, desire or knowledge to accomplish. Sure, there are bad seeds out there in the wholesale world, but there are bad seeds in every aspect of business. I find BP to be an incredible resource for me as an investor and a wholesaler. For you to want to begin a petition to rid posts and forums about a particular side of investing seems selfish and a little "one sided". I can only assume you've had a bad experience, but to burn the industry as a whole really doesn't provide much credibility on your part.
311 Replies
- 11yJoe VilleneuvePro MemberPlymouth, MI · Member since 2013 · 13k+ posts · 19k+ votes
Why? Do the discussions have some form of "cooties"? There appears to be a lot of discussion, therefore interest on it. I would think BP would be doing a disservice if they did drop it.
Some investors may not think of wholesaling as a form of investing, but it most certainly is a means for investors light on funds, to acquire funds for investing.
Also, and this is probably the most important point why NOT to drop it, isn't it more advantageous to other REI to have the wholesalers supplying deals to REI to have those wholesalers able to get the info they need to do it right?
- Residential Real Estate Agent · Orlando, FL · Member since 2015 · 139 posts · 106 votes11y
I'm not sure why I'm even responding to this insulting post but since you've hit a nerve, I'm going to try. Wholesales and wholesalers are an intricate part for many investors. Considering we move 30-50 properties a month to our investors may show that wholesalers play an important role for many investors. We work to provide quality investments and take over all the hard work and time it takes to acquire properties for our investors that don't have the time, desire or knowledge to accomplish. Sure, there are bad seeds out there in the wholesale world, but there are bad seeds in every aspect of business. I find BP to be an incredible resource for me as an investor and a wholesaler. For you to want to begin a petition to rid posts and forums about a particular side of investing seems selfish and a little "one sided". I can only assume you've had a bad experience, but to burn the industry as a whole really doesn't provide much credibility on your part.
- La Puente, CA · Member since 2015 · 97 posts · 49 votes11y
@Brandon Sturgill
You're off base on this one.
I'm not a wholesaler and I don't have plans on being a wholesaler but I wish anyone who wanted to be a wholesaler would spend some time on Biggerpockets. If they could learn about how to fill their role more efficiently everyone would benefit. I'm dying for properties and it kills me to see "deals" listed at 90% of ARV. If wholesalers took the time to learn how to do the job more efficiently they would close more deals and I could purchase more properties from them.
Why wouldn't I want that?
- Investor · Century, FL · Member since 2015 · 950 posts · 603 votes11y
Originally posted by @Joe Kling:
@Brandon Sturgill
Why wouldn't I want that?
I'll bite, wholesalers are inflating pricing within the market. Why do I want that?
Wholesalers don't fulfill any purpose in the market. If there were no wholesalers, the property will still come to the market through realtors. They serve no function.
Realtors take 6%, wholesalers take what? Last one I did was 30%. Why was that in my interest?
In fact, I'd say that wholesalers are bad for sellers as well. There is no real discussion about the value of a property, not even an obligation to buy the property when it goes under contract. Most are totally misrepresenting themselves to sellers frankly.
And wholesalers are no more investors than Walmart is an investor in groceries.
- 11yJoe VilleneuvePro MemberPlymouth, MI · Member since 2013 · 13k+ posts · 19k+ votes
My point exactly. Wholesaling alone may not be thought of as REI, but it is a very important part of REI, and I think it is the responsibility of BP to provide that side of REI knowledge too.
Business Plans, Social Media, Blogging, also are not forms of REI, but they are all important parts of it. While we're at it then, should we be discussing dropping those groups too?
- 11yJoe VilleneuvePro MemberPlymouth, MI · Member since 2013 · 13k+ posts · 19k+ votes
Originally posted by @James DeRoest:
Originally posted by @Joe Kling:
@Brandon Sturgill
Why wouldn't I want that?
I'll bite, wholesalers are inflating pricing within the market. Why do I want that?
Wholesalers don't fulfill any purpose in the market. If there were no wholesalers, the property will still come to the market through realtors. They serve no function.
Realtors take 6%, wholesalers take what? Last one I did was 30%. Why was that in my interest?
In fact, I'd say that wholesalers are bad for sellers as well. There is no real discussion about the value of a property, not even an obligation to buy the property when it goes under contract. Most are totally misrepresenting themselves to sellers frankly.
And wholesalers are no more investors than Walmart is an investor in groceries.
You just gave all the reasons NOT to drop wholesaling as a discussion, and to make sure that this blog continued to provide education/info on how to do it right. You described the wrong way to wholesale.
You could also replace the word "wholesaler" with "<REI>" in your list of comments, and would be just as accurate.
"If there were no <REI>, the property will still come to the market through realtors. They serve no function.
Realtors take 6%, <REI> take what? Last one I did was 30%. Why was that in my interest?
In fact, I'd say that <REI> are bad for sellers as well. There is no real discussion about the value of a property, not even an obligation to buy the property when it goes under contract. Most are totally misrepresenting themselves to sellers frankly."
- Wholesaler · Nashville, TN · Member since 2014 · 407 posts · 180 votes11y
I was halfway tempted to not respond due to the fact that this post couldn't have been formed for a healthy intellectual debate. You didn't even give any good points... but hey I am only human..
Should we do away with all realtor discussions on here as well since thats not really investing? Obviously wholesaling isn't investing, but it is directly tied with investing and many wholesalers buy and hold themselves. Also, you can bash wholesalers all you want but I am sure if you had one that was feeding you amazing deals you would be singing a different tune.
- Investor · Los Angeles, CA · Member since 2014 · 180 posts · 72 votes11y
Originally posted by @Joe Kling:
@Brandon Sturgill
You're off base on this one.
I'm not a wholesaler and I don't have plans on being a wholesaler but I wish anyone who wanted to be a wholesaler would spend some time on Biggerpockets. If they could learn about how to fill their role more efficiently everyone would benefit. I'm dying for properties and it kills me to see "deals" listed at 90% of ARV. If wholesalers took the time to learn how to do the job more efficiently they would close more deals and I could purchase more properties from them.
Why wouldn't I want that?
Exactly. What is your real problem with people discussing wholesaling? It obviously plays a big role in REI and the better wholesalers understand the business and how to best serve their clients (investors) the better off we all are.
- La Puente, CA · Member since 2015 · 97 posts · 49 votes11y
Originally posted by @James DeRoest:
Originally posted by @Joe Kling:
@Brandon Sturgill
Why wouldn't I want that?
I'll bite, wholesalers are inflating pricing within the market. Why do I want that?
Wholesalers don't fulfill any purpose in the market. If there were no wholesalers, the property will still come to the market through realtors. They serve no function.
Realtors take 6%, wholesalers take what? Last one I did was 30%. Why was that in my interest?
In fact, I'd say that wholesalers are bad for sellers as well. There is no real discussion about the value of a property, not even an obligation to buy the property when it goes under contract. Most are totally misrepresenting themselves to sellers frankly.
And wholesalers are no more investors than Walmart is an investor in groceries.
James -
That goes to my point. If we can help wholesalers do their job better we'll all benefit. If we try to kick them out of the discussion, they'll still try to do the job but they'll do it poorly and won't fulfill their function.
You say that agents take 6% and wholesalers take 30%? We need wholesalers to understand that they're not building a long term sustainable business if they do this by offering "deals" at 80-90% of ARV.
I'd rather invest less of my time and money marketing to sellers and instead invest my time and money on the execution of the flip. If a wholesaler can get a property that's in rough condition to me for 50-60% of ARV even after their cut I'm better off than a realtor trying to get 100% of ARV by telling the owner that's what it's worth despite all of the repairs needed. Even if the wholesaler marked up their contract price by 30% - if they get it to me at 60% of ARV, I'm going to be dying to do business with that wholesaler because they're clearly brilliant at finding deals and locking them up and I now have a source of profitable deals.
- Real Estate Broker · Tucson, AZ · Member since 2012 · 410 posts · 337 votes11y
Originally posted by @Brandon Sturgill:
Given wholesaling is not a form of investing in real estate...perhaps licensee's and true investors should start thinking about a push to do away with related discussions...
An Open Letter...
It is always fascinating to me, the level of arrogance displayed by those who claim to be "True Investors."
Quite honestly, I've suffered the ignorance of others in silence mostly because I have felt that my opinion is of no consequence.... truthfully, it feels as though you are "pushing rope" with the mindsets of the lesser minded.
However, it is in times like these that it becomes incumbent upon all investors, Realtors® Wholesalers, and others involved in the real estate arena to strike out, and call lunacy what it is.
This is clearly the most uninformed, ridiculous post I've ever read on BP.
The notion that "true Investors" are ONLY those who aren't licensed, or the wholesaler is complete and utter foolishness.Ignorance? Or Fear?
I often wonder if it is people who believe as you do... are they ignorant (lacking knowledge or awareness in general; uneducated or unsophisticated. in case you need a definition)
OR
They are AFRAID.
Fear.. because they know that the Wholesalers and Investing Realtors® like myself are taking the deals from you and giving them to others who are more worthy?
Either way... whether Ignorant (knowing that WHOLESALING IS INVESTING) or Fearful (Investing Realtors® like myself stealing your deals out from underneath your untrained self)
A statement like the one you made on BiggerPockets today is both lacking awareness in general, and simply displays your lack of education.
May I suggest you take a step back and LEARN From those who are INVESTORS like myself, who are also INVESTORS, REALTORS® AND Wholesalers....
You see... people like me? We are in your marketplace... And if you want to limit free speech on a blogpost about a topic.. TURN IT OFF.. Don't Read it....
But in reality, I think what you are secretly wishing for is the absence of Wholesalers and Realtors® in your "Real Life"... so you PRETEND it could be that way on your Online one.
May I respectfully suggest that you.. instead of critique or criticize the way others do business... you sit down and listen or read??
I would be willing to bet you that you will learn something... Trust me.. there are people on this forum that have FORGOTTEN More about Real Estate than you have ever KNOWN... - Northern, CA · Member since 2014 · 674 posts · 444 votes11y
I'll never get why people get upset about a particular discussion on a forum. Read the title of the thread, if it mentions wholesaling then don't click. Problem solved. There are some people on this forum that are compete blowhards and self promoters, I've learned to skip their posts, not difficult.
- Residential Real Estate Agent · Orlando, FL · Member since 2015 · 139 posts · 106 votes11y
I understand that investors have had bad experiences with wholesalers. I've had bad experiences with realtors. I've had bad experiences with investors as well. Does this mean that investors are bad? Does it mean that realtors are bad? No. There are bad apples in any aspect of business. If you are not strong enough to be able to weed out the bad from the good, then that is a personal problem. Getting rid of a forum because you don't know how to do your "due diligence" is not the answer. As an investor, if you don't know how to analyze the numbers placed in front of you, then you need to find a new career. As far as a 30% mark up. If I or anyone in my company marked up a property 30%, I'm sure that would be the first and last deal they would have with that investor and we wouldn't be in business long. Considering we have been in business for 8 1/2 years and continue to hold an A+ rating, I am confident in saying we treat our investors the way investors should be treated. Lumping a group together as a waste of time or not necessary only shows you should do a little more research, learn a little more and become more educated as an investor. As of now, you're just making yourself look foolish.
- 11yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
I enjoy the wholesaling banter.. and I think it has brought to light how each state treats the acitivity. Like Ohio which is most definitely cracking down on the activity claiming it a unlicensed activity.
I think were wholesaling is headed is those that want to wholesale ( flip without touching) will just need to start to set up their money partners and transactional funding partners.
So this creates a nice niche for well someone like ME !!!
- Real Estate Broker · Tucson, AZ · Member since 2012 · 410 posts · 337 votes11y
Originally posted by @Dan Oliver:
I understand that investors have had bad experiences with wholesalers. I've had bad experiences with realtors. I've had bad experiences with investors as well. Does this mean that investors are bad? Does it mean that realtors are bad? No. There are bad apples in any aspect of business. If you are not strong enough to be able to weed out the bad from the good, then that is a personal problem. Getting rid of a forum because you don't know how to do your "due diligence" is not the answer. As an investor, if you don't know how to analyze the numbers placed in front of you, then you need to find a new career. As far as a 30% mark up. If I or anyone in my company marked up a property 30%, I'm sure that would be the first and last deal they would have with that investor and we wouldn't be in business long. Considering we have been in business for 8 1/2 years and continue to hold an A+ rating, I am confident in saying we treat our investors the way investors should be treated. Lumping a group together as a waste of time or not necessary only shows you should do a little more research, learn a little more and become more educated as an investor. As of now, you're just making yourself look foolish.
@Dan...You are my hero... I have boldfaced everything I "strongly agree" with.
You sir... get my personal "Seal Of AWESOMENESS" award!
On behalf of Investors, Wholesalers, and Realtors® everywhere... may I say...Kudos!
- Bedford, NH · Member since 2012 · 2k+ posts · 1k+ votes11y
I was going to disagree with the OP, and say that we should still have wholesalers posting because maybe then some can be saved.
But then I read Karl's ridiculous, insulting post, and think maybe they should be banned.
Believe it or not, Karl, I don't refrain from robbing banks because I am either ignorant of how to go about it, or afraid.
What absurd self-aggrandizement. Many of us have done things in our lives that require actual courage. It's not a word I would apply to screwing widows out of their homes.
I give you full respect for your role as a Realtor. Other roles, not so much.
- Investor · Century, FL · Member since 2015 · 950 posts · 603 votes11y
Originally posted by @Joe Kling:
Originally posted by @James DeRoest:
Originally posted by @Joe Kling:
@Brandon Sturgill
Why wouldn't I want that?
I'll bite, wholesalers are inflating pricing within the market. Why do I want that?
Wholesalers don't fulfill any purpose in the market. If there were no wholesalers, the property will still come to the market through realtors. They serve no function.
Realtors take 6%, wholesalers take what? Last one I did was 30%. Why was that in my interest?
In fact, I'd say that wholesalers are bad for sellers as well. There is no real discussion about the value of a property, not even an obligation to buy the property when it goes under contract. Most are totally misrepresenting themselves to sellers frankly.
And wholesalers are no more investors than Walmart is an investor in groceries.
James -
That goes to my point. If we can help wholesalers do their job better we'll all benefit. If we try to kick them out of the discussion, they'll still try to do the job but they'll do it poorly and won't fulfill their function.
You say that agents take 6% and wholesalers take 30%? We need wholesalers to understand that they're not building a long term sustainable business if they do this by offering "deals" at 80-90% of ARV.
I'd rather invest less of my time and money marketing to sellers and instead invest my time and money on the execution of the flip. If a wholesaler can get a property that's in rough condition to me for 50-60% of ARV even after their cut I'm better off than a realtor trying to get 100% of ARV by telling the owner that's what it's worth despite all of the repairs needed. Even if the wholesaler marked up their contract price by 30% - if they get it to me at 60% of ARV, I'm going to be dying to do business with that wholesaler because they're clearly brilliant at finding deals and locking them up and I now have a source of profitable deals.
My point, which you are missing, is that wholesalers provide no extra function in the market than is already provided by realtors. I'm not interested in them being at whatever job they think they have, we already have licensed professionals called realtors.
And even if you want to call them flippers - how does that help me? It's just more people to feed in an ever increasing priced market. Where do I find value from that? I don't.
- Investor · Dallas, TX · Member since 2014 · 2k+ posts · 1k+ votes11y
Interestingly enough, some of the best Wholesalers ARE investors who have such an awesome pipeline of deals they can't possibly take them all down them self. Would you suggest those Investors simply allow those deals to fall to the floor as chaff? That doesn't seem like a very good model for a successful business, nor is it good stewardship of the resources they have been given.
What about the folks who have no other way to get to a point they can financially gain entry into the investing side? And, if you describe Wholesalers as non-investors, I have to believe it is because you believe they aren't investing money in real estate. Well then, do you also discount Flippers as investors, since they have no intention of holding a property longer than it takes to rehab and sell it? I notice you didn't trying to bite off that chunk, because you probably know it would be akin to opening a can of whipa$$ on yourself.
The fact is, there are bad Wholesalers. I've written a post on it myself, with the hope of warning and educating. I regularly call out a couple of large wholesaling firms, because of their tactics. But, there are also bad Flippers. People who put lipstick on the pig and try to pass shoddy work off as a full renovation. There are bad agents. There are bad brokers. There are bad lenders. There are also a whole lot of earnest, well meaning people who desperately want to do it the right way and are simply looking for help in understanding what the "right" way is.
Maybe wholesaling, in and of itself, doesn't fit the definition of a "real estate investment". However, neither does the work of an agent or broker, unless they themselves are investing, and most aren't. But, all of them are undoubtedly real estate based businesses. A Wholesaler invests in their business, whether it is time, miles, knowledge, or actual cash. Mailings don't fund themselves. It takes an investment, even if it doesn't meet your definition of or even the most loosely held definition of a real estate investor. Would you suggest we eliminate all threads not directly related to the actual act of real estate investing? Of course you wouldn't. You seem to believe the mere fact someone holds some kind of license entitles them to certain latitude.
There have been plenty of posts bashing Wholesalers and wholesaling. There have been copious words written defending wholesaling and detailing why some of our esteemed colleagues view it as being an "unlicensed broker". But, this has to be the single most arrogant, small minded and uninformed post on the subject of wholesaling I've read to date. I'm grateful that the vast majority of the BP Community is cut from a different cloth. I'm even more grateful that Josh & Brandon will laugh and shake their heads, if they even bother to read it.
Oh wait...there is one other thing I'm grateful for at this moment. It is called the Ignore button. Have a great day.
- VENICE, FL · Member since 2015 · 113 posts · 36 votes11y
things just got real up in here.........quick lol
- Investor · Dallas, TX · Member since 2014 · 2k+ posts · 1k+ votes11y
@Joe Villeneuve "Cooties"...freaking hysterical!
@Jay Hinrichs You're spot on. More wholesalers having transactional funding in place will eliminate a whole lot of the arguments around wholesaling. BTW, I'm still going to come knocking on your door within the next year!
- 11yDev HornPro MemberFlipper/Rehabber · Arlington, TX · Member since 2013 · 1k+ posts · 2k+ votes
Wow. Anyone notice that the OP has not been back to comment? He just disparaged wholesaling and then sat to the side to watch the fight amongst the readers. What fun!
Wholesalers are marketers. They simply find motivated sellers in exchange for a fee. If they drive prices up too high, they don't do any/many deals and ultimately move on to some other money making idea.
But seriously if you think it's wholesalers driving prices up, I disagree. The thing driving prices up is limited inventory of housing in most markets in the U.S. right now. It's a seller's market in most major metros. That is definitely making it harder to find deals these days, and I think it leads people to think the problem "must be those d**n wholesalers!".
P.S. I agree with Hattie that most the wholesalers that I know personally are also cash buyers that simply wholesale deals that they don't choose to do. It's not lost on me that there are tons of posers in this business. I just don't really think the posers are in the mix as much as you think. Most of them are too scared to make offers, and very few of them get deals under contract. The wholesalers I meet in my market are NOT those posers. They are people who have serious marketing processes & budgets.
- 11yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
being old school the thought of going into a real estate deal without actually buying it is a foreign concept for me.. LOL.
but I like were the states are going.. as I can really provide some guidance and give those who understand that being in total control of the asset is a strength in the market place.
My thoughts on RE brokers Vs and vi wholesalers.. is there really is not a lot of comparison. RE agents good bad smart dumb or whatever.. had to somehow pass the test and they need to operate ( if they can) under a code of ethics. So I don't really see a correlation to wholesalers.. who need no formal training other than the advice they get from a site like BP which can be good can be mediocre and can be poor, just like a paid for guru.. you have no clue as to who is behind some of these posts. ,,, they need not pass a test , are not state regulated and have to adhere to a code of ethics apart from what ever the conscience tells them... Now as stated some states look at the activity as selling RE without a license ... so really depends on the state your in.
And believe me in my 40 years of loaning money to all manner of flippers wholesalers etc. I have seen it all... some folks are stand up... some are like some of the others posted.. if it means money for them they will do whatever it takes.. I call them financial sociopaths.
But being a middle man lender I also have to just keep to myself about everyone's business model... Its funny how indirectly I come into contact with many of the folks on BP and they don't even know it LOL...
- Bedford, NH · Member since 2012 · 2k+ posts · 1k+ votes11y
Originally posted by :
But being a middle man lender I also have to just keep to myself about everyone's business model... Its funny how indirectly I come into contact with many of the folks on BP and they don't even know it LOL...
I have a small piece of a 12-lot subdivision in Bedford, NH. There was a builder who made on offer, with a funder from Portland, OR. Was that you?
- La Puente, CA · Member since 2015 · 97 posts · 49 votes11y
Originally posted by @James DeRoest:
Originally posted by @Joe Kling:
Originally posted by @James DeRoest:
My point, which you are missing, is that wholesalers provide no extra function in the market than is already provided by realtors. I'm not interested in them being at whatever job they think they have, we already have licensed professionals called realtors.
And even if you want to call them flippers - how does that help me? It's just more people to feed in an ever increasing priced market. Where do I find value from that? I don't.
I'm not missing your point. I just disagree with it. Wholesalers provide the function of sourcing properties that need to be rehabbed and linking them with individuals who are capable and willing to do that job. Realtors sell properties at retail value. They help the average individual who wants to buy a home for their family. The average individual doesn't want to deal with a rehab and even if they did their financing would prevent them from buying the types if properties that wholesalers typically deal with. Wholesalers have to be great at marketing so they can find those opportunities that rehabbers need to do business.
The store at the mall doesn't typically buy directly from the producer/manufacturer. They buy from a wholesaler. Why is it different for REI?
- Real Estate Broker · Columbus, OH · Member since 2013 · 3k+ posts · 1k+ votes11y
@Joe Villeneuve Your points are indeed valid (as usual)
- Real Estate Broker · Columbus, OH · Member since 2013 · 3k+ posts · 1k+ votes11y
@Dan Oliver why not work with an agent...
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