Newly Contracted Property - When to Advertise?

Question

I have been wondering what the rest or you guys do after you get a property under contract to wholesale.

My first inclination is to e-mail and call investors and begin marketing the property, but what about putting it on your website?

I'm worried that if I put a newly contracted home on the web with  it's new-higher price then the original sellers will see it and try to back out.

I obviously want to get it sold before closing on it!

Brian P. · Answer

Chris

I have only had this problem a few times because I make it a point for them to know I'm an investor upfront, and that means for me to stay in business and cover all my overhead I need to make a fair profit, and that means I plan to sell it for more then the total cost to me, or I'll be out of business.

Now if you Mr/Mrs Seller are willing to take the same risks I am going to take, and do the work I am going to do, then it would make sense for you not to sell to me.

You will just have to put out all the money needed to bring the house into prime condition for a buyer who is willing to pay the price you want, and then find that buyer.

If that sounds like something you would like to do let me know and I will give you a few tips and we can part friends..

Most sellers have given this idea some thought already and your not giving them any new ideas. I don't go into details about my business. and it's a way to walk from a non-motivated seller,

Plus I tell them if things change for them and they find they don't really have the time to do it themselves then give me a call..Once in awhile they do.if they don't run into an investor that operates on a smaller margin then I do and gives them a few bucks more.

Chris T. · Answer

Yeah, I'm referring to the typical 65% of ARV - repairs - my fee.  I don't even focus on what the seller's asking price is I just run my numbers and make an offer.  Unless, they are willing to take less, then that's good too!

Ryan Webber · Answer

I would recommend you directly contact your solid buyer's first.  Try to build a relationship with these guys.  You may even give them a day or two before you market it to everyone else.

You will sell 90% of your deals to 10% of your buyer's list.  You want to filter your buyer's list the best you can to find the heavy hitters and cater to them.  Making the heavy hitters feel well taken care of is important to building long term relationships with them.

As for seller's seeing their property on your website for more, it's happened to me.  It is a rather uncomfortable conversation.  As Jeff shared, you can let them know up front that you will be marketing to sell the property and that would alleviate that problem.

As for paying asking price or not, who cares?  If it hits your numbers then its a deal whether its above, below, or at their asking price.  Some of the deals that I've made the most money on I paid full asking price for.  Actually thinking about it, many times the seller doesn't even have an asking price.  They just know they want to sell the property.

Don't get caught up in the game that you have to get the seller down for it to be a good deal.  You can lose thousands upon thousands of dollars that way.

Chris T. · Answer

The contract isn't what I'm worried about.

It's the crazy hacks that shake hands one minute then threaten to sue you the next when they see that you're trying to "make a profit off of them."

I'd like to minimize the drama as much as possible.

And, I missed your point when you commented about me being worried....

Jeff Warner · Answer

Chris,

I could be way off base but your comment about being worried led me to believe that you put the deal under contract for their asking price, then added your wholesale fee.

Some people are angry to see that someone else is making money off of their home even though they pay Realtors 6% with no questions asked.

I let people know up front that I am going to market their home to my list of buyers. In this market I've found that people don't really care what you do just as long as they get the money you agreed upon.

How strong is your buyers list?

Jeff

Jeff Warner · Answer

If you have a solid contract there should be no issue. The one thing that concerns me is this statement:

"I'm worried that if I put a newly contracted home on the web with it's new-higher price then the original sellers will see it and try to back out."

For this to be a GOOD deal you should have it under contract for LESS they they originally wanted, hopefully A LOT less.

To answer your question, I'd have it faxed, emailed, posted or however you do it as fast as humanly possible. The clock is ticking, how many days do you have until closing?

Jeff