I'm trying to figure out what steps I should take first so I can start wholesaling successfully. Should I build a buyers list before I seek out deals or should I get a deal under contract before I build my buyers list? Also, what are some of your favorite ways to build a strong buyers list?
Why not both? Get your marketing pieces out, make friends with an agent and ask for a closed cash transaction list. Boom buyers list. I'm not a big fan of the "come join my buyers list" craigslists ads, but you could do that. Network, network and network a little more.
I agree with @Christopher Goldie on working on both. I also never thought about a closed cash transactions list from an agent. Seems like a pretty solid idea to me.
There's also a site www.Findcompsnow.com that supposedly shows cash sales and private loans in a given area. Not sure of realibilty just yet but it may produce some results. I've back checked a few with county records and they were a match.
How long have you been reading about wholesaling @Matthew Carr ?
@Chaz Reid For about 2 months now.
Thanks so much! @Christopher Goldie I will definitely look into that.
No problem, sometimes reading just doesn't make it click. It didn't for me. Find the wholesalers in your area and seeif you can shadow them on a deal or two, or even joint venture with you. Good luck!
This question is technically opinion based @Matthew Carr .
Some will say look for a buyers, then a deal.
Some will say look for a seller, then the buyers will come.
You can do both at the same time but that might be a little overwhelming for you, especially since you've only been doing your research for about two months.
From my experience, if you find a deal, market it, buyers will come. If you can't move the property fast enough, your contract will cover you or you can negotiate a new deal with the seller.
I can't tell you what you can or can't do. I can only advise you of what worked for me the best. At the end of the day, its all based off your market, knowledge, and level of comfort.
Best of luck to you bro!
That's great! @Chaz Reid Thanks for the info. What's been the best marketing technique for you when seeking out buyers?
In my old market, bandit signs bro
@Matthew Carr When I began wholesaling - I networked with just a few serious buyers and then focused on finding a deal. I felt it was important to build solid relationships. Quality over quantity type of idea.
Yet, whatever strategy is most comfortable to you to allow yourself to confidently find and close deals is the way to go!
A real deal with attractive numbers is going to attract buyers, like @Chaz Reid said.
And, yes - Network, Network! @Christopher Goldie
To add my 2 cents, I am a strong believer of finding the deal first. Once you have a great deal everything else is easy. You can find all the steps you need to take and answers to your next "well what do I do now" question in that search bar at the top right of your screen. You will be amazed how many cash buyers you add on to your list along the way without even trying. That is if you are trying to network.
So to start off, just use the 70% rule as a guideline until you get more comfortable with what you are doing. Once you put it under contract and it meets that rule I am confident that you can take a print up of your deal to one of your local REI meetings and have cash buyers lining up to work with you.
Though you can work on both at the same time I think building a list is key because it will allow you to get an idea of what properties you should be looking for.
Just my thoughts....
Build the list first, but don't just build a list. Go out and meet some of these buyer. Try to figure out who is and who is not, a real player.
Deals are hard to come by. They need you as much as you need them, maybe more. Don't be afraid to ask lots of questions.
Thanks for the tip! @Griffin Fehrs What did you do to begin networking?
Thanks for all the advice everyone! I really appreciate it :)
@Matthew Carr The most effective way to begin networking for me was to go to any local investor meet ups. Find out who the most active investors are and go from there. Here on BiggerPockets also provides lots of opportunity. These two strategies alone will likely build enough momentum to get going!
If you have access to the MLS and your states MLS allows you to search cash sales - this is a way to find cash buyers - most likely investors. Here in CT, this option isn't available, but in some other states it is.
A few ways to build your buyer's list:
1. ask EVERYONE you meet if they rent or own. Even the garbage man. If they rent, ask why they don't own. Maybe they have bad credit and you can do a lease-option. This is a tip from James Smith (I bought his training at a Learning Annex ~ 2007). He sold a house to his garbage man. P.S. his garbage man was also a bird dog for him.
2. We buy Houses signs. They buy houses...
3. Auctions. I used to go to auctions and after each sale, my partners and I would approach the bidders. This was a few years ago when there were more auctions, but could still work. Plus, they are cash buyers!
4. Search BP forums to find active investors. Maybe people posting in the landlord questions section. Add them.
5. Google "We buy houses Ohio". The websites that show up on top probably get decent traffic or they pay for SEO, which also indicates that they may be active / successful investors. I did this for CT and my hunch was correct.
In my experience, REIA groups and Meetups could go either way. Some of them are sharks who will take advantage of noobs. And sometimes the active investors don't even go to the meetings. Ask the organizer about who in the group the real players are and message them on the Meetup group site, save yourself some time and sales pitches.
Thank you! @Chris L. That's very helpful.
Good advise and strategies from @Chris L. I will second the comment, the RIEA groups may or may not have the buyers you are looking for. We supply three solid rehabbers, cash buyers, with most all their wholesale deals. The three largest rehabbers I know of in our area who have cash and actively rehabbing in volume have never attented a RIEA meeting.
Remember that RIEA meetings have a LOT of newbies and people selling programs, properties that may not be good deals, solid advise and good information is not always readily available there. Do your due diligence find out who the real buyers are, real cash buyers can typically make decisions in 10-15 minutes of looking at a house. Finding a couple good cash buyers will save you a lot of grief.
The best to you!.
Work with an investor friendly real estate broker that's willing to work with you on deals and data of your local market.
omg! You guys are pretty genius. I don't know why I didn't think of half this stuff. So I'm new to investing and BP like Matthew. BTW hey there Matthew! @Chris Lad, I didn't know we, wholesalers could sell houses to company entities. Are we allowed to wholesale a deal with established local companies that have their own wholesalers??? Also, on meetup meetings, what you said about emailing the agent/investors first even before going out was pretty awesome. Thanks.
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