Which is best to do 1st

13 Replies

I see vacant homes ever time I turn around. I have did a lot of research an read & finish a couple of books about wholesales an very familiar about what’s going on with the business. My question is, is it best to build your buyers list 1st, before I start trying to contact these motivated & distress seller. Some people say get the property under contract 1st an the buyers will come. Which one did you successful wholesaler do 1st

@Johnnie Hawkins you definitely need a buyers list first. You can have the best deal around but with no buyers you can’t get it sold. 

Best ways to find cash buyers is networking at local REI meetups, masterminds, Facebook groups,

Realtors, title companies, closing attorneys, property management companies, auctions, Craigslist, bandit signs, google search etc.

You can search real estate transactions in your tax database. Look for entities and individuals that have bought multiple properties. You may need to search by the address of the buyer as they may change their name or the name of the entity on each purchase.

You can also buy lists from companies like list source and subscribe to software that will show you who the cash buyers are. You can skip trace addresses with a service like datazap and calm them up.

@Johnnie Hawkins this is the chicken or the egg questions. Although @Gregory Beaty make a good point I somewhat disagree. You can find a great deal and co-wholesale or JV the deal with a wholesaler that have an extensive buyers list. I would advise you to work on both simultaneously. If you get the deal there are wholesalers in NC you can work with. Let me know I have a colleague in Fayetteville that could assist you. I know that's 2 hours south on I-95 but she may know someone closer to you.

Again, work on both

 

@Johnnie Hawkins ,

@Greg Dickerson always gives great advice, and I would say @Marcus Maloney is right on track as well.

You need a buyers list, and I'm of the mind to start building it and don't stop.  You have some great ideas above for how to do that.  You should probably spend 20% of your time looking for buyers, and the other 80% looking for deals. 

When you have a lot of buyers, you will find that it's a piece of cake to get a property sold. Until then, don't hesitate to partner (JV) with others who are established and can find the buyers for you.

The key is to keep moving forward.

Good luck!

This post has been removed.

I totally disagree with most of the advice I see on these replies.  You DO NOT need a buyers list first to get a deal sold.  I mean let's think about this... You have a great deal signed up.  Now, just because you don't have buyers FIRST you won't be able to sell it????  Does this make sense?  No, it doesn't.  

I get calls weekly from "wholesalers" who will have a deal in the future and want to know my buying criteria yadayadayada.  Guess what...I never hear back from them.  They are wasting their time calling people like me instead of finding deals.  


Do you know who I rarely hear from?  People who actually have a REAL deal.  Call a legit investor for the first time with an actual deal and you will sell it.  Plain and simple.  Give an investor a great deal and he/she will be begging you for more.  


If you want to waste your time calling around to investors who have heard that pitch a thousand times, go for it.  Post on Facebook groups that you have a deal that doesn't really exist so you can mine for email addresses (that your email will go to spam anyways).  I just wouldn't advise you to do that.


For me, if I was starting out fresh in a new city...I'd be talking with sellers and hustling up a deal.  If it is truly a deal, selling it will be the Easy part.  

Sure I have a buyers list that I have built.  I keep it well cultivated.   The difference is, mine was built organically based on actual deals that I have had for sale.  Not built based on unfounded promises of "future deals" and phantom internet deals.  If you really want to stand out in your area from all the internet "deal" guys...go get an actual deal.  Trust me, this is the way to start off in this business. 

@Johnnie Hawkins you don’t need a buyers list but you do have to have a clue how to market the property. Your deal needs to be really good. Most wholesalers get weak deals under contract and wonder why they can’t sell them. A big buyers list is not going to move a crappy deal. If you do not absolutely KNOW that you can move the property or close on it yourself,it is unethical to imply to the seller that you can.

@Johnnie Hawkins for me I got the property first only because without that I would have procrastinated but with that extra added pressure there's no room for procrastination you have to stay on it or you lose the property because of lack of funds as a wholesaler that's something you can't do, is procrastinate. I wouldn't suggest it for anyone else for me that seems to be the perfect strategy.

Originally posted by @Marcus Maloney :

@Johnnie Hawkins this is the chicken or the egg questions. Although @Gregory Beaty make a good point I somewhat disagree. You can find a great deal and co-wholesale or JV the deal with a wholesaler that have an extensive buyers list. I would advise you to work on both simultaneously. If you get the deal there are wholesalers in NC you can work with. Let me know I have a colleague in Fayetteville that could assist you. I know that's 2 hours south on I-95 but she may know someone closer to you.

Again, work on both

 

This is one of many ways how wholesalers get a bad name, too many people in the middle trying to get a piece of a pie and the end result is often the end buyer having no spread to work with or the transaction so convoluted that it fails. 

As you can see from the responses @Johnnie Hawkins you will get opinions on both sides and both with make good arguments for their opinions but in reality, there is only way correct way to do this legally, ethically, and efficiently. (Keep in mind that getting a property under contract, then marketing that deal to potential buyers without holding a real estate license is illegal in many states) Most wholesalers fail because they don't understand how to properly evaluate rehab numbers and exit values (ARV's) and without those numbers, you can't possibly come up with an accurate offer amount. Second, many talk about building an extensive buyers list. That is hog wash and guru nonsense, a good wholesaler locates a few real all cash buyers who have proven track records (the wholesaler confirms their purchasing abi,I ties by looking up public records for their previous all cash purchases and also requests their proof of funds so they know they are legit) and then they get each buyer's specific criteria so they know what to shop for.

This topic and question has been discussed here on BP hundreds of times and this thread I just responded to with a debate on the chicken and egg situation, I suggest you read it:

https://www.biggerpockets.com/...

 

Create Lasting Wealth Through Real Estate

Join the millions of people achieving financial freedom through the power of real estate investing

Start here