best way to market bulk housing package

Browns Summit, NC · Member since 2014 · 9 posts · 1 vote

Good morning! Ive recently come across a package home deal working with a seller. This seller i looking to sell about 100 REO SFR, in bulk.. What are the best ways to market to this level of buyers??

I've tried contacting commercial brokers who might work with investors (seems like it might be successful, just started this deal Friday), and I'm going to post ads on CL and what not, anything else?

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Jon Holdman

Rental Property Investor · Mercer Island, WA · Member since 2008 · 22k+ posts · 14k+ votes

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Does the "seller" actually own these houses? Or is this person "direct to seller"? Are they using words like "tape", "NCND", "POF", or "+3"?

There is almost zero chance there's anything legitimate going on here. These kind of deals do happen, but the seller (usually a bank) deals directly with the buyers (a hedge fund or some real estate investment syndicate.)

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Joe VilleneuvePro Member
Plymouth, MI · Member since 2013 · 13k+ posts · 19k+ votes
11y
You probably will find a cold shoulder from the commercial brokers. What you have access to is most likely what's left from larger bulk packages. In other words, what the other investors passed on. This is pretty typical.
Joe V
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Jon Holdman
Rental Property Investor · Mercer Island, WA · Member since 2008 · 22k+ posts · 14k+ votes
11y
Does the "seller" actually own these houses? Or is this person "direct to seller"? Are they using words like "tape", "NCND", "POF", or "+3"?
There is almost zero chance there's anything legitimate going on here. These kind of deals do happen, but the seller (usually a bank) deals directly with the buyers (a hedge fund or some real estate investment syndicate.)
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Micheal James
OP
Browns Summit, NC · Member since 2014 · 9 posts · 1 vote
11y
hi, to clarify, I believe the seller is working with a bank or working with the company that is working with the bank
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Joe VilleneuvePro Member
Plymouth, MI · Member since 2013 · 13k+ posts · 19k+ votes
11y
Originally posted by @Micheal James:
hi, to clarify, I believe the seller is working with a bank or working with the company that is working with the bank
See what @jon holdman said about that. The bank usually presents the "good" ones to Hedge funds, and they are much larger than what you are talking about here. What's left, they present to outside brokers and individuals that have access to other, brokers and individuals, that have access to...well, you get the picture.
If in fact you are first to the broker that is first to the bank only means the "daisy chain" of "points" added on for every broker and individual is small...but it's the same already filtered list.
Joe
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Micheal James
OP
Browns Summit, NC · Member since 2014 · 9 posts · 1 vote
11y
i see. The numbers seem pretty opportune. From looking at the values, yes Jon an ncnd was used.
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Joseph Ball
Residential Real Estate Agent · Groveland, FL · Member since 2012 · 504 posts · 395 votes
11y
Jon Holdman is correct. This is likely a scam or a "Daisy Chain". I wouldn't waste time on it until you verify legitimacy, and ownership. I have experience with these.
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Micheal James
OP
Browns Summit, NC · Member since 2014 · 9 posts · 1 vote
11y
what is a daisy chain?
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Joe VilleneuvePro Member
Plymouth, MI · Member since 2013 · 13k+ posts · 19k+ votes
11y
Originally posted by @Micheal James:

what is a daisy chain?
Ever play that game when you were young where you whispered something to the person next to you, and they whispered the same thing to the next person, and so on?
In this case, what they are all whispering, is to add 1 point on to the deal for me when the person at the end of the line sells the list.
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Micheal James
OP
Browns Summit, NC · Member since 2014 · 9 posts · 1 vote
11y
gotcha, well how would I verify ownership? Just look up the property data? I have the addresses and such listed in a spreadsheet with value records
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Jon Holdman
Rental Property Investor · Mercer Island, WA · Member since 2008 · 22k+ posts · 14k+ votes
11y
Almost certainly the person (they are in no way a "seller") is far, far removed from the bank. He or she is just like you. Somebody told them about this "tape" and they have stars in their eyes thinking they are going to get a 3% commission on a million dollar deal. Just like the 20 people in front of them.
There is NOTHING here. Forget about it. This isn't a scam per-se, because nobody is going to make any money at all off this tape. But it is a complete waste of your time.
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Micheal James
OP
Browns Summit, NC · Member since 2014 · 9 posts · 1 vote
11y
Hi, I have the comps and pretty much all the data on the houses, is there no way to cross check them for validity?
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Jon Holdman
Rental Property Investor · Mercer Island, WA · Member since 2008 · 22k+ posts · 14k+ votes
11y
The properties on this tape are most likely legitimate. They might even be owned by some bank or other lender. At one point, someone posted the contents of their tape. It was simply a copy of the REOs one of the big banks had listed on their web site. So, all legitimate REOs. But absolutely no linkage to anyone wanting to sell them in bulk.
If you're determined, research the properties in county records.
These deals DO happen. I know of one group here locally who buys these, rehabs them and either holds them or sells them. But they are the buyer. The work directly with the banks that are selling them. There are no middlemen.
This is not new. "Bulk REO" has been around for years. This is nothing but a big time waster for you. Think about it. If some bank really had 100 houses they wanted to move as a unit, what would they do? Choice A, contact hedge funds they know are buying SFRs. Not hard to find these, and if you're a VP at a big bank you'll get past the gate keepers and talk to someone who can actually do a deal. Choice B, distribute a "tape" to a bunch of random people on the internet and hope one of them finds some buyer with $5 million to spend based on a craigslist ad. Which would you choose?
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Jay HinrichsBusiness Member
Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
11y
@Micheal James
Waste of time ----------and your in the vortex of a broker daisy chain with many on the daisy chain not actually being brokers.
It reminds me of those that try to trade jet fuel and think they can do it from the comforts of their home...
I have seen a few folks be able to cherry pick from Bank REO but they had direct communication from the bank that owned the asset.
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Jay HinrichsBusiness Member
Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
11y
@Jon Holdman
Sorry Jon I just posted exactly what you wrote before I read what you wrote.. WE are in agreement 100% on this subject been there done that...
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Micheal James
OP
Browns Summit, NC · Member since 2014 · 9 posts · 1 vote
11y
understood, thank you for the input!!
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Dean Letfus
Specialist · Memphis, TN · Member since 2012 · 1k+ posts · 1k+ votes
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Just to be contrary we have been offered many, many packets in Memphis of 20 to 100 homes. Not one of them was a scam or not "real". The comment about them being not the best deals is likely true if it's a bank, however nearly all the packets we have seen have come from private investors. We are buying one right now, 44 doors 5 mil buy. In Memphis we can;t get enough inventory so you would have no problem selling it here but in your town I don't know....
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Jay HinrichsBusiness Member
Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
11y
@Dean Letfus
completely different transaction.. in your case its some investor that happens to own 44 homes. And what will certainly be inventory of the future will be Hedge funds selling off their properties they bought over the last 4 years or so... I can see a day when they start putting up 20 to 100 home offerings.. And maybe letting investor cherry pick through them.
What the OP is talking about is a bank tape which I think everyone above has covered what those are and how they work....
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Dean Letfus
Specialist · Memphis, TN · Member since 2012 · 1k+ posts · 1k+ votes
11y
Yes I know @Jay Hinrichs but my point was simply that in my city most tapes and packets are genuine. We don't have all the negative issues that it appears many other cities have maybe?
Bank tapes have never gotten out into the public domain here, except real rubbish, they are all sold through the old boys network.
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Micheal James
OP
Browns Summit, NC · Member since 2014 · 9 posts · 1 vote
11y
i appreciate everyone's feedback, after doing a bit of research on the tape and the person I'm working with, I'm going to decide to risk being the fool.
The tape looks genuine so I'm going to go with my gut on this, im willing to risk the time and effort (I think it will be worth it). If there's ant advice, I would still be interested in hearing it. Thanks!
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Derry A. Price
Providence, RI · Member since 2014 · 4 posts · 1 vote
11y
@MichealJames - this industry is not perfect, and you can't be afraid to fail. I'm glad you decided to take the "risk" if you were able to manage or handle the "worst case" scenario. Different things work in different markets. Have you had any success? I'm just learning to do "tapes" - however more on a direct relationship with the AMs. Share back your experience after going with it, I would like to know what I could do differently.
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