Is it me or does my market really suck? Maybe it's just me?

Wholesaling
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Is it me or does my market really suck? Maybe it's just me?

Jonathan Park
Manchester, NH · Member since 2013 · 9 posts · 0 votes

I've been talking to sellers non-stop making offers, putting up signs, doing direct mail. Using scripts when talking to sellers, but every time I talk to sellers, they are asking full retail price for run down properties. Throwing out un-realistic numbers. Especially in my market, there isn't that many wholesalers up here. I thought I could dominated this market, but the sellers are just beating me up with unreasonable prices. I have buyers lining up for properties, but I just can't seem to get sellers to get the price I want. Within the past three months, I talked to over 150 sellers, went to 9 appointments and got two contracts. One house is a multi unit that all my buyers just don't want because it's too far out of their buying criteria or they just want single families. The other was so run down that my buyers were afraid.

Am I doing something run folks? I'm really struggling hardcore =/

I'm thinking about just virtual wholesale now instead of working my market.

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Jeff Coga
Developer · Hollywood, CA · Member since 2011 · 81 posts · 29 votes
12y
Originally posted by @Jonathan Park:
Within the past three months, I talked to over 150 sellers, went to 9 appointments and got two contracts. One house is a multi unit that all my buyers just don't want because it's too far out of their buying criteria or they just want single families. The other was so run down that my buyers were afraid.

In three months you spoke to 150 sellers and only went on 9 appointment and got two contracts. I need 10 contracts and close on about 2 of those. So I would suggest that you should keep on calling sellers back and or make a bigger data base of distress sellers. For you to get a discount you need financial distress and distress on the condition of the property.

Now... for the other "really beat up house"... you should be able to turn that into money if you get a developer buyer. If the developer buyer doesn't want to buy it, it still means that the property is tied up too high.

Don't give up... scale more, in 3 months - 150 sellers equals 50 sellers a month. That's 1.66 sellers you're talking to every day. Get that number up to like 5. Most people quite, when they're so close to making it.

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  • Jeff Coga
    Developer · Hollywood, CA · Member since 2011 · 81 posts · 29 votes
    12y
    Originally posted by @Jonathan Park:
    Within the past three months, I talked to over 150 sellers, went to 9 appointments and got two contracts. One house is a multi unit that all my buyers just don't want because it's too far out of their buying criteria or they just want single families. The other was so run down that my buyers were afraid.

    In three months you spoke to 150 sellers and only went on 9 appointment and got two contracts. I need 10 contracts and close on about 2 of those. So I would suggest that you should keep on calling sellers back and or make a bigger data base of distress sellers. For you to get a discount you need financial distress and distress on the condition of the property.

    Now... for the other "really beat up house"... you should be able to turn that into money if you get a developer buyer. If the developer buyer doesn't want to buy it, it still means that the property is tied up too high.

    Don't give up... scale more, in 3 months - 150 sellers equals 50 sellers a month. That's 1.66 sellers you're talking to every day. Get that number up to like 5. Most people quite, when they're so close to making it.

    1Reply
  • Scott E.
    Contractor · Scottsdale, AZ · Member since 2010 · 2k+ posts · 3k+ votes
    12y

    Jonathan -

    Are you in New Hampshire? It might help to reach out to BP members in your area to share strategies. In my area wholesalers seem to have the process down. I am receiving 5-10 deals per week. Unfortunately many do not meet my criteria as a rehabber, but if there are that many deals in my competitive market, I'd imagine there are even more to be found in yours.

    As @Jeff Coga suggested, it sounds like you just need to scale. More mailers, more hours spent on marketing, and more time on the phones. Your hard work will pay off!

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  • Ibrahim Hughes
    Real Estate Consultant · Bloomfield, NJ · Member since 2010 · 2k+ posts · 1k+ votes
    12y

    Jonathan - from where are you getting your sellers? Let's start there.

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  • Dawn AnastasiPro Member
    Rental Property Investor · Milwaukee, WI · Member since 2013 · 6k+ posts · 4k+ votes
    12y
    Originally posted by @Jonathan Park:
    I thought I could dominated this market, but the sellers are just beating me up with unreasonable prices. I have buyers lining up for properties, but I just can't seem to get sellers to get the price I want.

    What do they say when you give them a price that is more in line with what your buyers would expect?

    Podcast Guest on Show #29
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  • Shaun Reilly
    Landlord and Rehabber · Newton, MA · Member since 2010 · 2k+ posts · 877 votes
    12y

    Where in NH are you?

    There are plenty of people on BP that are from there and can maybe help you figure out some strategies.

    Most people want full retail, or more, for their properties. This is an issue for anyone involved with real estate from every investor down to agents and people looking to buy their own home. As Dawn said what happens when you give them a realistic price? They will always WANT as much as they can get the key is to see what they will take.

    Easy numbers, say you think a place is worth $70K and you ask them what they want and they say $100K. Do you say okay and end the conversation or to you, gently and tactfully, say that is more than you will be able to offer and was thinking something more like $60K (So you can come up a little)?

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  • Ann Bellamy
    Lender · Tyngsboro, MA · Member since 2009 · 3k+ posts · 2k+ votes
    12y

    Jonathan, there are lots of investors in NH. I live in Nashua, and was a past board member and Treasurer of NHREIA.

    There is a whole group of guys who do nothing but attend the foreclosure auctions and resell the contract to their buyers list. NH allows either 3 or 5 days (I forget the number) to change the name on the memorandum of sale (You probably know that foreclosures are conducted at each property and not on the courthouse steps)

    As noted in my first paragraph, there is an active REIA. I have partnered with guys who specialize in Berlin and Claremont, and others who do rehabs all over the state.

    You can probably improve your buyers list by attending the NHREIA, the next meeting is tonight, and one of my partners is the speaker. I won't be there, because I'm vacationing in SC, but Nick is a pretty good draw, he's talking about horror stories on rehabs. I'm speaking next month on Multi family screening.

    Depending on where you are farming, you may suffer from being too rural. Many investors don't want to buy north of Concord, because there are too few end buyers and tenants, the area is simply too sparsly populated, but others do well if they tap into the right sources.

    Expand both your marketing for motivated sellers and your buyer's list and see if it improves. There are several active wholesalers who attend NHREIA regularly to sell their deals. They also don't limit themselves to NH but work in MA also.

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  • Jonathan Park
    OP
    Manchester, NH · Member since 2013 · 9 posts · 0 votes
    12y

    @Scott Swink what do you mean by BP?

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  • Jonathan Park
    OP
    Manchester, NH · Member since 2013 · 9 posts · 0 votes
    12y

    @ibrahim. I get my leads from bandit signs, us lead list for leads.

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  • Jonathan Park
    OP
    Manchester, NH · Member since 2013 · 9 posts · 0 votes
    12y

    @dawn, they usually are mortified when I tell them the price I'm offering.

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  • Jonathan Park
    OP
    Manchester, NH · Member since 2013 · 9 posts · 0 votes
    12y

    @shaun really, I don't end right there. I tell the usually line, " if I pay the closing cost, transfer tax, and you don't have to pay realtors fee and etc, what is your bottom line?" 95% of times they are still stuck on retail. One lady told me it's because she is seeing her friends and family getting full price for their run down properties.

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  • Jonathan Park
    OP
    Manchester, NH · Member since 2013 · 9 posts · 0 votes
    12y

    @ann I probably met you at the rei lol. Bulk of my buyers list came from the meetings. I'm going there tonight to try and wholesale this property I have.

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  • Dawn AnastasiPro Member
    Rental Property Investor · Milwaukee, WI · Member since 2013 · 6k+ posts · 4k+ votes
    12y

    Maybe "that's what I can offer you for a quick sale" versus waiting around for full price (for however long that takes) or having to spend additional money to rehab the place just to get full price.

    Podcast Guest on Show #29
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  • Shaun Reilly
    Landlord and Rehabber · Newton, MA · Member since 2010 · 2k+ posts · 877 votes
    12y
    Originally posted by @Jonathan Park:
    @shaun really, I don't end right there. I tell the usually line, " if I pay the closing cost, transfer tax, and you don't have to pay realtors fee and etc, what is your bottom line?" 95% of times they are still stuck on retail. One lady told me it's because she is seeing her friends and family getting full price for their run down properties.

    If they think they really will get full price it will be hard to compete. Playing up the fast and easy aspects are the only real play you have.

    Did this particular person indicate that these friends and family live in the same area? If they are in a different market it wouldn't be relevant. That won't change HER mind usually but if lots people are getting full price for fixers in your area that could indicate you will have a tougher time getting deals.

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  • Jonathan Park
    OP
    Manchester, NH · Member since 2013 · 9 posts · 0 votes
    12y

    I'm going to take dawns advice and ramp it up more and make it more detailed marketing system.

    0Reply
  • Dev HornPro Member
    Flipper/Rehabber · Arlington, TX · Member since 2013 · 1k+ posts · 2k+ votes
    12y

    I think you need to rethink your lead sources. Your numbers are not good - 150 sellers and only 9 viewings of property and only 2 contracts? The pros in this business get qualified leads and they can contract about 1 in 20, so your results are way off where you need to be.

    You are dealing with UNQUALIFIED LEADS - the reason they are not open to your offer is they probably have ZERO EQUITY so they can't deal with you. They have nothing to deal with!

    There is a cost to good marketing, but it's worth the investment. Consider buying high quality leads from a source like Listsource.com and only mail to people (such as absentee owners) with 40% or more equity. Yes, these leads will cost you about 17 cents a name/address - worth every penny.

    Qualified leads are the result of 2 key factors:
    1) YOUR LIST - start with the right prospect pool
    2) YOUR MESSAGE - say the right things in your marketing to get the right people to call you.

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  • Todd Plambeck
    Agent/Investor · Murphy, TX · Member since 2013 · 542 posts · 304 votes
    12y

    Just for the sake of curiosity, are you following up with them to see if they are in fact selling their houses and at what price? If they are selling them for retail, who is buying them and if not a tactful, "I told you so" and reiteration of your offer would be in order.

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