Wholesaler · Edmond, OK · Member since 2012 · 53 posts · 24 votes
If you know of a wholesale deal, can you wholesale it to one of your buyers?
Like someone put it under contract already and you negotiate the price with them and then sell it a bit higher??
Investor · Baltimore, MD · Member since 2008 · 17k+ posts · 13k+ votes
13y
Yes you can wholesale a wholesale deal. As Timothy Rogers said a second wholesale fee can ruin a good deal. While it can and does happen, don't expect to make a business model out of it.
One of my good friends was at a settlement where six people got wholesale fees. I foolishly passed on it early on because I didn't think it was a good enough deal.
Investor · Garland, TX · Member since 2010 · 99 posts · 92 votes
13y
Tarek Wazzan yes, you can wholesale a wholesale deal. Personally, I don't do it. I will bring another wholesaler a buyer and wholesaler can give me a percentage of his profits.
I don't do it, because you will turn a wholesale deal that it is a good wholesale deal into not a deal just by adding your fees to it. Most wholesalers don't mind sharing their profits if you can help them sell it.
I have found that wholesalers that tell you to add your fees, usually have suck up all the potential profit. The reason the property is not selling, is due to the wholesaler being greedy.
Investor · Baltimore, MD · Member since 2008 · 17k+ posts · 13k+ votes
13y
Yes you can wholesale a wholesale deal. As Timothy Rogers said a second wholesale fee can ruin a good deal. While it can and does happen, don't expect to make a business model out of it.
One of my good friends was at a settlement where six people got wholesale fees. I foolishly passed on it early on because I didn't think it was a good enough deal.
Investor · Atlanta, GA · Member since 2010 · 186 posts · 14 votes
13y
I would not recommend you doing it. I think you would lose credibility as a wholesaler if buyers find out what you are doing. Personally, if I find out somebody wholesaling a wholesale deal to me, I would stop taking him seriously.
Investor · Central Valley, CA · Member since 2012 · 6k+ posts · 3k+ votes
13y
I've been "double flipped" more than once. I would think I had a killer deal, get it into escrow with an end buyer, and think I had really scored. Only to find out months later that my buyers did the same thing....sometimes making more than I did on their re-sale. Thankfully it's been awhile. I know values WAY better now. I doubt anyone who has bought from me recently would accuse me of leaving money on the table.
Today's lending environment is incredibly restrictive, even with hard money lenders, so usually every leg of these transactions will require cash. That being said, there is no shortage of cash in this market. At least in the markets I work. The shortage is in available properties.
If you know value and you can buy from a "wholesaler" and bring that to a buyer that will pay more? I say go for it.
Naga A. Is this one of those principal things? Or is this your actual business practice? Say I have a property and I offer it to you for $150K and you want it for $150K. In fact you are thrilled with $150K. Do you really care if I got it from a wholesaler for $130K, who got it from the seller for $100K?
I would stop taking you seriously as a buyer if you worried about my profit. :)
Investor · Atlanta, GA · Member since 2010 · 186 posts · 14 votes
13y
K. Marie Poe
On more than one occasions, I received information about a "deal" from multiple wholesalers and they were talking about the same property.
Wholesaler A asked for $50,000 and Wholesaler asked for $53000 on the same property. Clearly, Wholesaler B is double flipping and trying to make money quick and easy.
May be it just me, but I stopped taking Wholesaler B seriously after I found out what he was doing.
I rather want to work with a wholesaler who does leg work himself to find a good unlisted deal for me.
Residential Real Estate Agent · Ocala, FL · Member since 2009 · 255 posts · 65 votes
13y
Originally posted by K. Marie Poe:
I've been "double flipped" more than once. I would think I had a killer deal, get it into escrow with an end buyer, and think I had really scored. Only to find out months later that my buyers did the same thing....sometimes making more than I did on their re-sale. Thankfully it's been awhile. I know values WAY better now. I doubt anyone who has bought from me recently would accuse me of leaving money on the table.
Though I'm never excited when this happens, i've had it happen to me a few times too. I've also had people attempt to do it and fell on their face with an over improved property still on the market 180 days later.
After much reflection over the past months I've realized that when I sell "wholesale" to a cash buyer and he waits it out to get a retail buyer at a better margin i have nothing to complain about. I'm not even sure if i did anything that was "wrong". Not all property should be taken to the highest potential. Sometimes the risk/cost just isn't worth it. Nobody has a perfectly clear crystal ball.
Least that is my 2 cents, i'm sure scott will disagree with something I said.
Residential Real Estate Agent · Ocala, FL · Member since 2009 · 255 posts · 65 votes
13y
Originally posted by Naga A.:
K. Marie Poe
On more than one occasions, I received information about a "deal" from multiple wholesalers and they were talking about the same property.
Wholesaler A asked for $50,000 and Wholesaler asked for $53000 on the same property. Clearly, Wholesaler B is double flipping and trying to make money quick and easy.
May be it just me, but I stopped taking Wholesaler B seriously after I found out what he was doing.
I rather want to work with a wholesaler who does leg work himself to find a good unlisted deal for me.
For the sake of being silly. What if the property was worth 130k? You really going to tell us you won't buy it from wholesale B? Or wholesale D at 75k. Or wholesale E at 80k. Just numbers on a page, get the emotion out of it.
Investor · Atlanta, GA · Member since 2010 · 186 posts · 14 votes
13y
Aaron Churnick
In that scenario, I would buy the property from Wholesaler A. I do not know if it is principal things, but rather, it is more a trust issue to me.
If I find out a wholesaler tries to make a quick buck off other whosaler's property or from MLS listed property, I would try to skip him and buy from the source, i.e. Wholesaler A or MLS.
Evans, GA · Member since 2012 · 17 posts · 2 votes
13y
Originally posted by Naga A.:
Aaron Churnick
In that scenario, I would buy the property from Wholesaler A. I do not know if it is principal things, but rather, it is more a trust issue to me.
If I find out a wholesaler tries to make a quick buck off other whosaler's property or from MLS listed property, I would try to skip him and buy from the source, i.e. Wholesaler A or MLS.
Is this some kind of joke or moral victory or something? A deal is a deal. If the numbers work for your business model all you are doing is losing the trust of Wholesaler D who brought you the deal if you try to go around him, yet you say it's a "trust issue". I suppose you don't find it important for your colleagues to trust you, only for you to trust them.
Also, where in this post did you get the idea that you had access to Wholesaler A? Any investor would prefer to get the "goods/item/property" from the "original seller" at the "cheapest price", but at the end of the day that isn't always "realistic" or a "smart idea" if it causes you to burn your bridges. You can't wave your magic wand and have Wholesaler A magically appear infront of you.
I am happy to know there will be more deals out there for other investors due to individuals like you letting your pride get in the way.
Investor · Atlanta, GA · Member since 2010 · 186 posts · 14 votes
13y
Hey Jeff Smith,
Calm down. Seem like you have misunderstood my post. I was only talking about my experience.
My experience was that Wholesaler A and Wholesaler B approached me with the same property at the same time. Wholesaler B saw Wholesaler A's deal somewhere, added $3000 profit to the price and tried to sell it to me.
I realized that Wholesaler B tried to make a quick buck off somebody else's deal. Since then, every time Wholesaler approaches me with a "deal", I assume that is not his deal but it is someone else's (and usually, that is the case.).
I do not know where the Wholesaler D talk comes from, and that seems a very different scenario.
Washington, Washington D.C. · Member since 2012 · 1 post · 0 votes
13y
Hey guys, need your help. I came across a wholesale deal that's under contract with another wholesaler. She mentioned that there's no room to share her small profit because of loans, etc. I'm pitching it to a interested buyer for +$5,000. How do or should I get that $5,000 paid to me? Do I tell the buyer that I added an extra $5,000 or does that come from the wholesaler when property is sold? If from the wholesaler, do I get a written agreement from her? Thanks!
Involved In Real Estate · Jacksonville, FL · Member since 2012 · 216 posts · 42 votes
13y
Ned Carey Wow six people! There really must have been a lot of meat on it or the end buyer way over-payed. Amazing that 5 wholesalers in a row would under-price it. That must have been an interesting closing with all of them there. lol
Investor · Baltimore, MD · Member since 2008 · 17k+ posts · 13k+ votes
13y
Tim Czarkowski It was on the edge of a very hot area when the market was white hot. This was back in 2004 or 2005 when people could make bad buys and still make money.
Kentha Stephens You should have started a new thread. because you question might get buried here.
It is all what you can negotiate. If your wholesaler doesn't have room to split the deal then you have to try to get something from the buyer. There is nothing wrong with that if the deal is good enough. But remember , you earn a fee because you are bringing a better than average deal to the table. If it's just an average deal then why do I need to pay you?