Know of any good wholesalers in the area?
Real Estate Agent · St. Louis, MO · Member since 2017 · 95 posts · 8 votes
Know of any good wholesalers in the area?
Most Popular Reply
Wholesaler · Saint Ann, MO · Member since 2014 · 50 posts · 27 votes
8y@Joshua Harger and others on this post, just food for thought from someone who worked for a company averaging 100 purchases a year in the St. Louis area...
A few mentioned being on lists, which is a good idea to do, to see what is out there. However, anything that hits a list probably is not a deal me, you, or anyone else who commented on here would want. Why? Couple of reasons, that have already been mentioned. But I think the biggest driving factor right now, is the market. If you can get a property under contract at 70%, close and take title, and then list in the MLS or blast to your list, due to the low inventory, it will sell. Worst case scenario, the company that bought at 70% (or whatever percentage purchase price made sense), can back it into a rental.
So, if you don't want to acquire yourself directly from the seller, which is going to be one of the best ways to get deals, you are going to have to find and become the good wholesalers best friend. Just to give you an idea, the guys that run the companies buying 100+ homes a year, they are calling wholesalers every week, asking them what they have. They want to get ahead of the email blast. They want to offer on every thing they are working on or have under contract. And if they are lower than asking, a good wholesaler can go back and negotiate. I'm not a fan of it, and have never done it, but sometimes it is the case. Some might be saying, why as a wholesaler go back and negotiate? Well, the bigger companies have proven that they really are buyers.
Many say they want the real deals from the wholesalers, but how many of them have actually bought homes or multi? How many have bought multiple homes / multi's a month? You start to really see who is for real and who is pretending.
Which is why a lot of deals are never seen in email blasts, because they are going to the real buyers. My old boss had it a part of his weekly agenda to take out 2 wholesalers every week. And he did it. Out of 100 homes, do you know how many came from other wholesalers? Somewhere between 60-70%. The remaining was direct mail, SEO, yellow pages, and miscellaneous referrals.
Outside of that, my only other two cents...I'm baffled if you want north county / rentals, north city, etc, you don't need wholesalers. There are plenty of deals on the MLS. I laugh when someone puts out a north city "deal." I have a buyer who consistently buys in 63115. I am getting to know it pretty well. We've averaged buying property at 8-15k a door. And "wholesalers" put out these deals higher or same price as what is on the MLS! You can throw a rock and find deals in north city. Not most people's cup of tea, just as an example.
Now, if you want a rehab in retail markets, you will not find that on the MLS. Foreclosures are going to owner occupants before it's open to investors, or they get bid up.
No matter what route you go, you've got to creative, and the tried and true old school methods still work.
10 Replies
- Rental Property Investor · St. Louis, MO · Member since 2015 · 41 posts · 28 votes8y
The market is pretty dry at the moment. Have you been on the local Facebook REI groups? I see houses daily there, though you will have to sift through a sea of north city houses. What are you looking for?
As far as the ARV numbers, yeah, I know what you mean. It's probably best to just establish your own. Even if their number is "right" it may not be the retail pricing model you use. You can pretty easily establish some $/SF figures for the different areas of St. Louis and get close based on that.
- 8yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
I am looking for a st Louis wholesaler to represent me the sale of a few of my properties.. any of you guys out there ? if so PM me or send me a request..
- Real Estate Agent · St. Louis, MO · Member since 2017 · 95 posts · 8 votes8y
@Matt Bowler Yes it's definitely pretty dry at the moment. I am on those, I see those ones that come up daily. Only problem is for the most part none of them are good deals haha! Yes, we do our own ARV number's for every deal no matter what. The problem with the ones with bad ARV's is that ask an exorbitant amount because of these numbers. So it's impossible to deal with them. Those one's just tend to feast on newbies or people who don't know the area.
- Rental Property Investor · St. Louis, MO · Member since 2015 · 41 posts · 28 votes8y
@Joshua Harger I try to get on as many buyers lists I can, mainly so I can see what’s happening in the market. In cases where the price is ridiculous I have flat out asked what calculation they use for pricing. In every case that I can remember it was someone who was 2nd or 3rd in line, each of them adding some greedy Hail Mary assignment fee. I tell myself these people won’t be around long but it seems someone keeps them in business.
I would encourage everyone to question these high fees. It gives the business a bad name.
- Investor · st louis, MO · Member since 2014 · 57 posts · 26 votes8yJay, what do you have to sell? I have buyers for tenanted houses but I’m also actively looking for the next ones to rehab. I rehab and flip investment properties in the north county area.
- Investor · st louis, MO · Member since 2014 · 57 posts · 26 votes8yAnd I do agree with everyone’s assessment with wholesalers around here. I’ll get the same dang house from 4 different people all at different prices, and absolutely silly arv too.
- Real Estate Agent · St. Louis, MO · Member since 2017 · 95 posts · 8 votes8y
@Matt Bowler @Tom Echols I agree with both of you. I see it quite a bit with getting the same deals with numbers all over the place. Somehow these people hang around, I do not know how. It usually takes me about 10 minutes of some searching to figure out that they are just throwing another deal around. Usually they prey on the unknowing people and it does give the legitimate wholesalers around here a bad name.
- Webster Groves, MO · Member since 2018 · 24 posts · 12 votes8y
The investors that make a living fixing and flipping and/or building a rental portfolio are those that usually get the leads directly from the seller themselves, a bank contact, a real estate agent, or an attorney. There are so many people out there wanting to become investors right now and its easier to shove a property down their throat because they will be a one and done investor, so why not make all you can on the wholesale deal why you can? This is why the wholesalers are asking such high prices right now, and can you blame them? There are a bunch of newbies paying for all these education programs that promise you'll get rich with no money and no knowledge of real estate. The majority of wholesalers I've dealt with are shady and they don't get care about building relationships for the long term. Don't worry, those types of wholesalers will be crying as the market continues to tighten and they have no deals. If your business model doesn't allow you to take a break from flipping until the right property comes along, then you have a bad business model. Pigs get fed, hogs get slaughtered. A business model that relies on getting properties from a wholesaler is a lazy business model. Get out there and contact some banks, real estate agents, etc. or do some direct mail. That's the only way you are going to get a steady source of leads without the wholesaler market that makes it impossible for the deal to work.
- Wholesaler · Saint Ann, MO · Member since 2014 · 50 posts · 27 votes8y
@Joshua Harger and others on this post, just food for thought from someone who worked for a company averaging 100 purchases a year in the St. Louis area...
A few mentioned being on lists, which is a good idea to do, to see what is out there. However, anything that hits a list probably is not a deal me, you, or anyone else who commented on here would want. Why? Couple of reasons, that have already been mentioned. But I think the biggest driving factor right now, is the market. If you can get a property under contract at 70%, close and take title, and then list in the MLS or blast to your list, due to the low inventory, it will sell. Worst case scenario, the company that bought at 70% (or whatever percentage purchase price made sense), can back it into a rental.
So, if you don't want to acquire yourself directly from the seller, which is going to be one of the best ways to get deals, you are going to have to find and become the good wholesalers best friend. Just to give you an idea, the guys that run the companies buying 100+ homes a year, they are calling wholesalers every week, asking them what they have. They want to get ahead of the email blast. They want to offer on every thing they are working on or have under contract. And if they are lower than asking, a good wholesaler can go back and negotiate. I'm not a fan of it, and have never done it, but sometimes it is the case. Some might be saying, why as a wholesaler go back and negotiate? Well, the bigger companies have proven that they really are buyers.
Many say they want the real deals from the wholesalers, but how many of them have actually bought homes or multi? How many have bought multiple homes / multi's a month? You start to really see who is for real and who is pretending.
Which is why a lot of deals are never seen in email blasts, because they are going to the real buyers. My old boss had it a part of his weekly agenda to take out 2 wholesalers every week. And he did it. Out of 100 homes, do you know how many came from other wholesalers? Somewhere between 60-70%. The remaining was direct mail, SEO, yellow pages, and miscellaneous referrals.
Outside of that, my only other two cents...I'm baffled if you want north county / rentals, north city, etc, you don't need wholesalers. There are plenty of deals on the MLS. I laugh when someone puts out a north city "deal." I have a buyer who consistently buys in 63115. I am getting to know it pretty well. We've averaged buying property at 8-15k a door. And "wholesalers" put out these deals higher or same price as what is on the MLS! You can throw a rock and find deals in north city. Not most people's cup of tea, just as an example.
Now, if you want a rehab in retail markets, you will not find that on the MLS. Foreclosures are going to owner occupants before it's open to investors, or they get bid up.
No matter what route you go, you've got to creative, and the tried and true old school methods still work. - 8yDavid OunanianBusiness MemberReal Estate Broker · St. Louis, MO · Member since 2017 · 380 posts · 195 votes
@Steve Christensen well said!
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