Two parts to wholesaling.  Sellers and buyers.  It does not coast anything to develop a buyers list.  Although there are free ways to market and I would definitely encourage you use them,  I would put most of your marketing into paid marketing.

Absolute best use of money on the paid marketing side is Direct Mail.  And I would mail to non owner occupants.

Hey Peter, 

Thank you so much for your feedback. I really appreciate it. 

First investment I would make would be a good website to help you grow and manage your lead base.

Next would be Business cards, they're cheap. 

Different forms of marketing work different in different markets. Use as many free sources as you can, CL ads, searching FSBO ads, etc. $5K will not go far in direct mail or online pay per click ads. After maximizing free resources, start marketing with paid advertising like Bandit signs, online ads, and direct mail. I would even consider partnering with someone more experienced to help you get started, you need a few deals to get more cash flow coming in. You will go through $5K quick.

List source you can specify non owner occupants. You can eliminate corps and LLC You can request by zip code by age of owner percentage of equity or years owned. Bedrooms square footage The list is endless but the more specifics the more it cost. Once you buy the list you can download to excel file. You can also create labels You pay one time. As long as You save it it's yours

@Jeff Filali Thanks Jeff! I'm actually in the process of getting a website together right now,

@joeDavalos Thanks for the helpful information. Now its time for me to take action.

@Keith Coleman I disagree with @Jeff Filali about making a website first.. People get so bogged down on making a perfect website (Which has not given me very many leads) , making a perfect business card, making a perfect yellow letter with the perfect lists.. that they actually just prolong actually getting started and taking serious action.

Your objective starting out is finding a solid, Juicy deal. Once you find a real deal, the buyers list will build itself.

I started my direct mail campaign with less than $600 and 6 weeks of time and it landed me a 25k deal. 

You don't have to spend tons of money to generate good leads. It all depends on how much work you're willing to put into it when your starting off.

If you need any help getting a direct mail campaign together let me know I would be happy to help you out and give you some advice on what has worked for me.

Good luck!

@Nicholas Armstrong Hey Nick, 

Thanks for sharing your knowledge  man. I appreciate those words. I was actually freaking out just because I didn’t not have a website and business cards. Yes, I would love to get some advice about direct mail. I know that I am just over thinking things and that is holding me back from getting started. 

If you've got 5k to spend you have roughly 5-10,000 pieces you can send. On average most folks are getting deals every 2500-5k pieces. 

In marketing for sellers you can either put in a lot of time and little money. Or you can put in more money and less time. 

What sort of time do you have to devote to this? 

Hey @Ryan Dossey thanks for reaching out. I would say that I  have the time to put in the work. My thing is coming up with a plan and run with it. What steps would you recommend? 

@Keith Coleman I would use God4d to build up a list of ugly houses. In the future their app will allow you to even send mail and pull phone #'s for the sellers. @Nate Pummel is their founder and is a GREAT guy. Let him know that I sent you and he'll hook you up on price. 

My recommendation would be to get about 1k addresses. Then cold call them. Mail the ones you can't get #'s for or can't get on the phone. 

You very well could get your 1st deal just from the calling. If you don't want to hand dial check out Mojosells.com

@Ryan Dossey Thanks for the much needed information. I really appreciate. I will be working on my craft this weekend. 

@Keith Coleman the quickest most efficient way to get deals when you have time and not a huge budget is to go driving for dollars.  I see in you're in Katy.  There is no shortage of opportunities in our area when it comes to vacant houses.  And vacant houses are some of the best leads out there as vacancy in my opinion is the number one overall indicator of the likelihood of a deal.  But not all vacant houses are equal.  If I were you I would do the following:

1.  Go drive and find 100 vacant properties and either get a picture of make a couple of notes of conditions ....i.e... boarded up, tree on house, code violation sign, overflowing mailbox, yard overgrown etc...

2.  Put all of those address in a spreadsheet and then go to HCAD and find owner name, length of ownership, and mailing address.  If ownership has just changed in last few months I would kill it.  

3.  Then go to Harris county tax assessor site and look for tax delinquency status.  Note the amount, the number of years, and the status (delinquent, suit, judgment)

4. Optional, but recommended, check each property on zillow to see if there's an expired listing. If there is, this can be great info. Of course MLS is fine, but zillow is quick and easy and enough for this exercise.

5.  Now prioritize your properties based off conditions (the rougher the house, the higher the priority), owner name (estates highest priority), mailing address (further away the better), tax delinquency (the higher and older the delinquency the better),  and which ones have an expired listing.  

NOTE:  I would not target flood properties right now in your situation.  Many of these owners are months away from making a decision.  

At this point you now not only have 100 good leads, you've got 10-20 that are probably have all kinds of issues on top of vacancy and you've got them as your top priorities.

If you want to mail them that's fine, but don't rely on mail.  Skip trace and call the owners.  Don't stop calling, texting, researching them or their relatives until you get in touch with someone.  Owners of vacant properties tend to be harder to reach in general, especially the more distressed vacant houses.

The problem with mail, especially with leads like this, is you never really know if the owner got it.  Or the owner may get it, and may want to sell, but won't call you because they don't think they can sell it or may not think they even own it.  This happens more than you would think.   Also, you'll find many vacant houses where the mailing address is the same as the property address so you'll have no option but to call in those situations.  

Besides vacant houses allowing you to be extremely targeted in your marketing, there are other benefits that are huge for newer investors.  Such as:

1.  Generally easier to negotiate

2.  Besides just getting a deal, they tend to be much better deals.

3.  Last and certainly not least, THEY ARE MUCH EASIER TO WHOLESALE OR CLOSE ON.  I hate scheduling contractors, buyers, in occupied houses.   Just trust me when I say between the seller and/or the buyers, it can be a headache.  Not to mention the headache of making sure they move out on time.

This may seem in the weeds, but it's extremely effective and can be done easily for less than $400. Hope it at least gives you some ideas.

@Dave Ramirez I wouldn't say the state of Texas frowns on wholesaling.  However, as in many states, the state does have laws that we must abide by.   They are not really overbearing laws that hard to comply with.   In a nutshell, as long as you don't present yourself as the owner of the property or the actual seller of the property and you are clear when you market to potential buyers that you only selling your equitable interest in the property (wholesaling), you won't have any problems.   

I wholesale and know a lot of wholesalers and don't know any that have ever even been contacted by TREC much less fined for wholesaling because they do it the right way.  

Google “wholesaling Real Estate  in Texas” and tell me they don’t frown

@Larry Higgins Thanks a lot man.  I really needed this information. I was wondering what website to use when looking for properties like the ones you mentioned. How long have you been investing?

@Dave Ramirez I think we just have a different idea of what "frowning" is.  It's completely legal and easy to do legally.  I know quite a few full time wholesalers and investors who occasionally wholesale and I've never heard a single person argue that our laws are too difficult or cumbersome to comply with or that they've ever been investigated or fined.   Probably because we do it legally.

Realtors aren't always our biggest fans, but that's understandable.  And they have all kinds of opportunities to try and shut down wholesalers, but they can't.

Just out of curiosity, what is about our laws you consider "frowning"?

@Keith Coleman no problem.  Glad I could help.  I've been at it for almost 4 years now.  Great ride so far!

What do you mean when you say "owner name(estates highest priority)"?

Which of the factors that you mentioned is most important or least important? I am going to make a bell curve for each factor and give it a score based off the properties percentile. If a given property scores 98 percentile then it gets a score of ~9.8 for that factor. If it gets 50% percentile I give it a dead average score of 5 out of 10. I then add all the component scores together and I start tracing the properties with the highest overall score. I need to know which factor is most important so I can add a "weight" to it. 

So lets say house condition is priority number 1 and a house scores 6 on that dimension. I may think I should give that factor more weight by multiplying it by lets say 1.5.        

1.5 * 6= 9      I then add 9 instead of 6 to the properties overall priority score,

Lets now say a property scores 6 just like the other property except this time on owner name. I think owner name is less important than other factors so now I multiply it by .66 or however I want to weigh it.

6*.66 = 4      I then add 4 to the overall score instead of 6.

Do you think this a good strategy?

Lol @ investors from Virginia trying to tell investors from Texas about Texas government...

@Cody Evans

What I meant by the "estates highest priority" note was that if I have a bunch of vacant properties and I'm prioritizing them just based off of free county data initially I can do some of that just based off of the owner names.  You will find that when you look up some property owners they will be in the "Estate of XXXXXX".   This tells me the owner of the vacant property is deceased, thus it's higher priority.   

So let's say I have 100 vacant properties and 6 of them are in estates according to county data.   And this is a very reasonable scenario.  I can prioritize the top 6 out of the 100 just based off of names before I even add further data/criteria to the list.

In regards to the other factors, they are are fairly equal in my opinion.  When I prioritize, it's not so much about giving extra weight to any one indicator, but which properties have the most indicators.  

I'm VERY targeted in what I pursue right now because I have limited capacity to work deals right now (trying to fix that now).  So my criteria is the following: Vacancy, deceased owner (not probate), and delinquent taxes or loan.  And obviously a lot of equity in the property.  

But lets say I had more capacity to work more leads.  If I could build a list of just 2 out of 3 of those indicators, it's still a solid list.  I just know that each time I loosen my criteria and require fewer distress indicators, my ratio of leads to deals will expand and will require more capacity to work thru them all.   Still very worthwhile.

If I had to pick the number one indicator overall of the likelihood of a deal I'm confident it's vacancy.   

Hope that adds a little clarity