How can realtors and wholesalers work together? What value can I as an agent provide to a wholesaler? I have a client who is new to real estate investing. He is currently wholesaling to start building capital to do some of his own investments. Obviously we'll be invaluable with his own investments, but I'm just wondering how I can help him get to that point and what I can offer in the meantime? I work my *** off for my clients and I'd love to help him grow his business, but I'm just confused about how this could all fit together.
@Rakan Abuzahra You sound like a very hard working agent that would go extra lengths for his clients and partners. Great quality to have on an investing team.
Agents are valuable to wholesalers by providing comps, by them having access to you for the MLS, running recent sales in the area, rent rates, make offers on properties, networking, etc.
In return, a wholesaler provides leads to you of people do not want to sell right away, or are looking for an agent to sell the traditional way. Creating a win-win for all parties at hand.
To me a true wholesaler provides solutions that almost always create a win-win solution for everyone involved and having everyone with a smile on their face at the end of the day.
Do your best to provide property's that are around 65-70% of the ARV. And your new client will have product to wholesale to investors. You would be doing him a real favor if you can do this for your client. I have an Agent that works hard to provide these listings to me. I have a list of ready, willing, and able buyers to move these properties to.
@Rakan Abuzahra I am new at this but there are a few things I would look for as a wholesaler
- 1. Understanding the market like recent sold and rental rates.
- 2. Doing quick appraisals and help understand what improvements buyers in the area expect. This will help the wholesaler can estimate rehab cost.
- 3. Finding property details. I asked my realtor to find intell on a vacant property.
- 4. If you come across a vacant to poor maintained property while in the target area, tip your wholesaler off. You may get a finders fee from that too.
Thanks guys. I guess one thing I'm still murky on is that it seems like most of the time you'd be going for properties that aren't actively on the MLS for one reason or another. So I would think that MLS searches wouldn't be very helpful because if they are listed, they most likely want retail price and then that could get very confusing having 2 agents commission and a wholesaler taking a bite out of the sale.
Can you give referral fees?
One way you can work together is if the wholesaler gets a lead from someone wanting to sell their house but ends up not being motivated enough. You may be able to get the wholesaler to forward that lead to you so you can get the listing.
Then you give the wholesaler some sort of referral fee if it sells - Even if its $100, thats still something for the wholesaler that they otherwise wouldn't have made.
I would watch the referral fee as it may be considered a kickback which may have negative effects.
@Rakan Abuzahra the MLS comps will help determine ARV (after repair value) this is the base number the flipper uses to determine max investment. So the basic math to a wholesaler is 70%ofARV-Wholesaler commission-repair cost= offer price. A realtor can provide data and information but wont make money helping out a wholesaler unless he starts fixing and flipping, you can get a referral fee (assuming that is legal) or he finds a seller that wants retail price for their property and you can list it.
Wholesaling is not about real estate is about deals. You can help your clients by bringing your clients good deals