Why do Wholesalers Lie

[Kristi K.]

I’m about ready to give up on wholesalers! I’ve wasted a lot of time going and looking at “a jewel of a deal”. Here is the latest example from yesterday

This is how they advertise it, $180,000

“If you’re looking for a great investment, with great bones and endless possibilities, this 3-bedroom, 2-bath gem in New Braunfels is it! The roof is 5-7 years old and the foundation was updated 5-7 years ago so the big stuff is already taken care of. All it needs now is a little TLC to bring it to life—think fresh paint, new fixtures, etc.

The cabinets, floors, and walls are all in good shape, so you’ve got a solid starting point. It’s the perfect opportunity for an investor hunting for a smart deal.

Located in a great area with a charming downtown, awesome local restaurants, and plenty of outdoor fun by the Guadalupe and Comal Rivers.

This is one of those homes that doesn’t come around often—a solid investment with tons of potential that won’t take much to make it shine.”

The county has it appraised at $188,000 and here are some pics.  

My question is how can someone be so far off on value and continue to keep their job? 

[Alan Asriants]

Many wholesalers motives are to make a quick buck. They are more motivated by the payout than building a relationship. Agents are also susceptible to this, but tends to be more prevalent in the wholesaler community. My guess is that their mentors are similar, no barrier to entry, and no major organization or entity that holds them accountable for ethics. 

This is also why you will see most deals in the not so favorable areas as it is easier for them to prey upon those sellers. I've walked through a property with a wholesaler and when I walked in I told him the ceiling height here is a big factor for resale and I can't use the comps he sent me. He was surprised and when I asked him if he thought it was a big deal he told me: NOT AT ALL! Lol.

They have decent deals from time to time, but they are usually volume based, not in tune with market, and more motivated to push a sale than to really see if a deal is good or not. Take their ARVs and cost of rehab with a grain of salt. Do your own due diligence and don't believe the hype. You'll believe it when you see it. Sometimes there are good deals tho