I'm Losing Faith In Wholesaling

47 Replies

I'm in about 5 different investment groups on Facebook and they all complain about wholesaler calls, wholesaler text, wholesaling postcards, etc. As someone who aspires to be a Buy and Hold Investor, I try to put myself in the other person's shoes when making these phone calls asking someone to sell their home for 40% below market value....and I can't picture a world where an investor would be excited to take that deal.

Seriosuly wholesalers, how many calls are you making a day, how many postcards are you sending out, how much money are you spending on ads and gas to Drive For Dollars? Are you texting? Is wholesaling worth it in a hot market? I can see how this was a lucrative business model in 2006-2012. But now...how do you stand out? 

I'm 4 weeks in and 0-25 but I've reached out about 200 times using different forms of communication. 

@Anthony Watkins your last phrase says a lot... you're 4 weeks into it it's way too soon to expect results! Wholesaling (and sales & marketing in general) is all about consistency, everything works from postcards to text, cold calling, PPC, etc as long as you're consistent, usually, I recommend trying any marketing channel for 6 months before you decide if it's worth it or not. Some people wait 1yr before they get their first deal under contract. 

2nd issue, you're talking about reaching out 200 times in 4 weeks, each of my cold caller dials on average 970 numbers and get connected to 72 people per day, you have to keep dialing if you want to see results. 

But you're right on point... Wholesaling has been falsely advertised as something you can do with little to no money... marketing costs a lot of money and you better watch where you spend those dollars. 

I agree a very small percentage of sellers are going to fit the "distressed" box and be happy with a 50ct/$ cash offer, this is why you should have several other strategies to offer (listing it as an agent, buy&hold, fix and flip, seller finance, sub to...) 

And yes people get upset sometimes with outbound marketing, doesn't matter your industry it's the price to pay... if you cant handle that, try inbound marketing like PPC they are usually softer. 

Good luck,

970 calls a day, reaching 72 people per day and getting one contract after a year, doesn't sound worth it. 

That's 254 thousand calls and almost 19 thousand people talked to. Those numbers are not very encouraging.

Originally posted by @Anthony Watkins :

I'm in about 5 different investment groups on Facebook and they all complain about wholesaler calls, wholesaler text, wholesaling postcards, etc. As someone who aspires to be a Buy and Hold Investor, I try to put myself in the other person's shoes when making these phone calls asking someone to sell their home for 40% below market value....and I can't picture a world where an investor would be excited to take that deal.

Seriosuly wholesalers, how many calls are you making a day, how many postcards are you sending out, how much money are you spending on ads and gas to Drive For Dollars? Are you texting? Is wholesaling worth it in a hot market? I can see how this was a lucrative business model in 2006-2012. But now...how do you stand out? 

I'm 4 weeks in and 0-25 but I've reached out about 200 times using different forms of communication. 

 One of the successful wholesalers says he spends about $30,000 a month on postcards. That keeps his two acquisition guys busy. So, I suspect if your used his cards, mailed into his markets and had his skills you could spend $15,000 a person a month and do pretty well. (Whatever that may be.)

By the way, laws are changing and in some areas now, apparently you have to take possession (actually buy the property) or you can be charged with practising real estate without a license, unless you have a license of course.

There are methods one can use in wholesaling that doesn't include cold calling or mailing out post cards. Bandit signs and word of mouth work well for me. As for the annoying phone calls, text and email. Several of other types of businesses are doing the same thing. We've simply joined the trend. I just ignore them or hang up the phone. I would think most people do the same. I can't imagine how any company would actually make any money by annoying people.

As for wholesaling without a license. Honestly I wish others would not compare us to realtors. While what we do is similar, it is not the same thing and we are not practicing real estate.

@Anthony Watkins  It's taken some people 2 weeks to get a deal. Others have taken. 2 months, 6 month, 1 year, 2 year...

Wholesaling is tough. But, it's not impossible. You need to be willing to market consistently for months without seeing any profit. 

Delayed gratification is essential for an entrepreneur. Just persist and remain consistent in your marketing efforts.

Wholeselling - Bugging 10,000 people to find the 1 person that is in a desperate situation and has no idea of market value, realtors or auctioneers.  Then hoping to keep them in the dark until you close and walk away with 40% of their money and claim you rescued them from poverty, misery and life long devastation. 

Yeah, wholescamming annoys me very much and I wish it were illegal in every state. A wholesaler is to a realtor what a pay day lender is to a credit union. 

Originally posted by @Terrell Garren :

Wholeselling - Bugging 10,000 people to find the 1 person that is in a desperate situation and has no idea of market value, realtors or auctioneers.  Then hoping to keep them in the dark until you close and walk away with 40% of their money and claim you rescued them from poverty, misery and life long devastation. 

Yeah, wholescamming annoys me very much and I wish it were illegal in every state. A wholesaler is to a realtor what a pay day lender is to a credit union.

Ya I wonder when the feds will start to jump in and say its predatory just like predatory lending.

@Randall E Collins Now come on. Let’s all be honest. A W/S is 100% facilitating a Real Estate transaction. (Insert jargon about how you are selling a contract, not a property).

I’m not knocking the hustle and I’ve bought a few deals from them. Let’s call a spade a spade though, right?

First off, I simply posted a reply to Mr. Watkins as wasn't attempting to start a Wholesaler vs. Realtor argument with the haters. But....

I totally agree, ALL the junk mail, phone solicitation calls, spam emails and text I receive is very annoying. Not just the ones I get from other wholesalers. It's amazing how so many people have my contact information and makes one wonder how they got it. But for a person to single out wholesalers is a bit bias and unjust.

Realtors are allowed to advertise via billboards, Zillow, MLS etc.. Which I find annoying in my search for property because most is being sold by a realtor. I don't complain about it. Every one in the sales market must use some sort of advertising strategy to be successful. Can't knock the strategy wholesalers have to use because realtors have other means locked in.

Wholesale is just as the phrase indicates "Wholesale" not retail price. Realtors shoot for the high retail price and charge the seller for doing so. Convince the seller to set a price that's likely much higher than what a property is actually worth just so they can pocket the extra funds from the buyer. Todays market value and or retail price for real estate is so tremendously high that average people can't even afford the down payment. Forget about the "poor ole" seller. What about the buyer? What about the single mom of three children that can't afford to buy a house and still feed her children. How can any realtor sleep nights knowing they sold a home at such a high price that people are going hungry just so they can have a place to live. Sellers are not as ignorant as a realtor tries to make them. Some refuse to pay a realtor to do what they can do them self. Most will conduct their own due diligence prior to setting a price for their property. Any person with a brain will not sell anything at a price that's much lower than what the item is worth. Unless they are desperate for money, which describes most people in today's society. Unless of course you're a realtor getting wealthy at the expense of others. Some one please tell me again how awful of a person a wholesaler is. We're not the ones that are ripping people off. Sellers or buyers.

I believe the reason why wholesaling without a license is not illegal in most states is because law makers understand the difference between a realtor and a person who wholesales. Sadly others are not intelligent enough to have that understanding. It seems the only people who have a problem with it are realtors. Only because we're making money that their greedy *** could have made. Besides if I did have a license all I'd be is a crook with a license. Enough said.

@Jay Hinrichs

Hi Jay, how’s it going?

While I agree with most of what you and some others believe about wholesaling and wholesalers, my experience has shown me that in some instances wholesalers do provide a valuable service. Of course, most of my experience in in commercial real estate, and in commercial there aren’t nearly as many Iill informed potential sellers as in residential.

One example that comes to mind was an acquisition of a RV park in Montgomery County, Texas. A mortgage broker was seeking acquisition funding on behalf of the buyer. As a “semi attractive” deal I followed up and discovered that a wholesaler had the property under contract for $900,000, and was “flipping” it to the end buyer for $945,000. The seller was an attorney, who was willing to take back a small subordinated mortgage. The borrower had about $400,000 to put in. In speaking with the seller, I was curious to find out how the wholesaling transaction had taken place. The seller told me that he had the property listed with a major commercial brokerage for over one year, and had not received any legitimate offers. After the listing had expired, he was contacted by the wholesaler, who told him that she wasn’t the ultimate buyer, but she had a buyers list of investors interested in purchasing the RV Park at a certain price. I guess she made a good impression as they signed a contract with a 15 day termination clause. To show seriousness, of a sort, she put up a non refundable $1000.00 for the 15 day option.

I later followed up with the wholesaler, and actually met with her for breakfast. She told me she specialized in RV Parks, Mobile Home Parks, and recreational campgrounds, and did not pursue anything else. She had built up a buyers list of real buyers over the years, and was willing to gamble with relatively small option fees when a seller was willing to price correctly.

Now, it can be argued that she should, or at least could acquire a brokers license. My opinion is that once the real estate commission establishes the requirement for all wholesaling activity to be licensed, they’ll then try to call wholesaling activity “ net listings” and regulate net listings out of existence. My personal opinion is that, just as in lending, a distinction should be made between residential property, commercial property, and investment property. A free and unrestricted market, subject only to commercial laws works best for commercial and investment real estate. On the other hand, nobody wants to see their parents scammed in their old age, and hence some consumer protections in residential property is probably justified.

Originally posted by @Randall E Collins :

First off, I simply posted a reply to Mr. Watkins as wasn't attempting to start a Wholesaler vs. Realtor argument with the haters. But....

I totally agree, ALL the junk mail, phone solicitation calls, spam emails and text I receive is very annoying. Not just the ones I get from other wholesalers. It's amazing how so many people have my contact information and makes one wonder how they got it. But for a person to single out wholesalers is a bit bias and unjust.

Realtors are allowed to advertise via billboards, Zillow, MLS etc.. Which I find annoying in my search for property because most is being sold by a realtor. I don't complain about it. Every one in the sales market must use some sort of advertising strategy to be successful. Can't knock the strategy wholesalers have to use because realtors have other means locked in.

Wholesale is just as the phrase indicates "Wholesale" not retail price. Realtors shoot for the high retail price and charge the seller for doing so. Convince the seller to set a price that's likely much higher than what a property is actually worth just so they can pocket the extra funds from the buyer. Todays market value and or retail price for real estate is so tremendously high that average people can't even afford the down payment. Forget about the "poor ole" seller. What about the buyer? What about the single mom of three children that can't afford to buy a house and still feed her children. How can any realtor sleep nights knowing they sold a home at such a high price that people are going hungry just so they can have a place to live. Sellers are not as ignorant as a realtor tries to make them. Some refuse to pay a realtor to do what they can do them self. Most will conduct their own due diligence prior to setting a price for their property. Any person with a brain will not sell anything at a price that's much lower than what the item is worth. Unless they are desperate for money, which describes most people in today's society. Unless of course you're a realtor getting wealthy at the expense of others. Some one please tell me again how awful of a person a wholesaler is. We're not the ones that are ripping people off. Sellers or buyers.

I believe the reason why wholesaling without a license is not illegal in most states is because law makers understand the difference between a realtor and a person who wholesales. Sadly others are not intelligent enough to have that understanding. It seems the only people who have a problem with it are realtors. Only because we're making money that their greedy *** could have made. Besides if I did have a license all I'd be is a crook with a license. Enough said.

 I guess you are entitled to your opinion but your examples are so far off, they hold no water. If Realtors are convincing sellers as you state to set a price much higher than the retail value "just so they can pocket the extra cash", this would never work as the buyer's pool is what sets the actual price, not the agent or the seller. An asking price has less to do with the actual value than most know. Picking a higher than market value list price almost always gets you little activity which then results in the need for a price reduction.

Your last paragraph is simply wrong all together. Most states DO have laws that stipulate brokering without a license is illegal, not the other way around, it is just that most wholesalers ignore the laws and do so anyways. That says a whole lot about their industry.

Originally posted by @Will Barnard :
Originally posted by @Randall E Collins:

First off, I simply posted a reply to Mr. Watkins as wasn't attempting to start a Wholesaler vs. Realtor argument with the haters. But....

I totally agree, ALL the junk mail, phone solicitation calls, spam emails and text I receive is very annoying. Not just the ones I get from other wholesalers. It's amazing how so many people have my contact information and makes one wonder how they got it. But for a person to single out wholesalers is a bit bias and unjust.

Realtors are allowed to advertise via billboards, Zillow, MLS etc.. Which I find annoying in my search for property because most is being sold by a realtor. I don't complain about it. Every one in the sales market must use some sort of advertising strategy to be successful. Can't knock the strategy wholesalers have to use because realtors have other means locked in.

Wholesale is just as the phrase indicates "Wholesale" not retail price. Realtors shoot for the high retail price and charge the seller for doing so. Convince the seller to set a price that's likely much higher than what a property is actually worth just so they can pocket the extra funds from the buyer. Todays market value and or retail price for real estate is so tremendously high that average people can't even afford the down payment. Forget about the "poor ole" seller. What about the buyer? What about the single mom of three children that can't afford to buy a house and still feed her children. How can any realtor sleep nights knowing they sold a home at such a high price that people are going hungry just so they can have a place to live. Sellers are not as ignorant as a realtor tries to make them. Some refuse to pay a realtor to do what they can do them self. Most will conduct their own due diligence prior to setting a price for their property. Any person with a brain will not sell anything at a price that's much lower than what the item is worth. Unless they are desperate for money, which describes most people in today's society. Unless of course you're a realtor getting wealthy at the expense of others. Some one please tell me again how awful of a person a wholesaler is. We're not the ones that are ripping people off. Sellers or buyers.

I believe the reason why wholesaling without a license is not illegal in most states is because law makers understand the difference between a realtor and a person who wholesales. Sadly others are not intelligent enough to have that understanding. It seems the only people who have a problem with it are realtors. Only because we're making money that their greedy *** could have made. Besides if I did have a license all I'd be is a crook with a license. Enough said.

 I guess you are entitled to your opinion but your examples are so far off, they hold no water. If Realtors are convincing sellers as you state to set a price much higher than the retail value "just so they can pocket the extra cash", this would never work as the buyer's pool is what sets the actual price, not the agent or the seller. An asking price has less to do with the actual value than most know. Picking a higher than market value list price almost always gets you little activity which then results in the need for a price reduction.

Your last paragraph is simply wrong all together. Most states DO have laws that stipulate brokering without a license is illegal, not the other way around, it is just that most wholesalers ignore the laws and do so anyways. That says a whole lot about their industry.

I agree 100%, the buyer sets the price, and the market is the market is the market. If you sat down with sellers and listed a house for a million in an area with model matches of that house for $500,000 and same condition the seller would never get that price and you would waste everyones time. 

In all my experience with listings is that as the agent/broker we are providing information to the seller, and most of the time the seller comes back and asks us to list for even more money after we do a full market analysis with the seller on what price to list for at that time. So, ultimate between a realtor and a wholesaler the sellers are only going with the professional that can fix their needs the best (price, condition, situation etc.).

@Anthony Watkins , the issue, to me, is there is such a wide divergence of what wholesaling is.  Everywhere except real estate, wholesale and wholesaling involves buying in bulk and then retailing it back.  I.e. Target buys paper towels at wholesale, and then sell them at retail, profiting the margin.  I do not know of any individual wholesaler who does this.  

Now, as others mentioned, you are jumping into a business where a lot of people do anything they can to stand apart.  But the one thing many wholesalers don't do is pay a reasonably fair price.  So what can you do to stand apart? Be honest, be fair with your pricing, and understand the value that you bring to a transaction.  Alternatively, if you are going after distressed owners, as most wholesalers do, be smarter.  Start looking at buying under performing mortgages.  This takes you out of the riff raff of wholesaling and competing in the shark tank.  But still gives you access to the real estate, either through foreclosure, or letting a wholesaler buy the property and you made money in the mortgage payoff.

Originally posted by @Don Konipol :

@Jay Hinrichs

Hi Jay, how’s it going?

While I agree with most of what you and some others believe about wholesaling and wholesalers, my experience has shown me that in some instances wholesalers do provide a valuable service. Of course, most of my experience in in commercial real estate, and in commercial there aren’t nearly as many Iill informed potential sellers as in residential.

One example that comes to mind was an acquisition of a RV park in Montgomery County, Texas. A mortgage broker was seeking acquisition funding on behalf of the buyer. As a “semi attractive” deal I followed up and discovered that a wholesaler had the property under contract for $900,000, and was “flipping” it to the end buyer for $945,000. The seller was an attorney, who was willing to take back a small subordinated mortgage. The borrower had about $400,000 to put in. In speaking with the seller, I was curious to find out how the wholesaling transaction had taken place. The seller told me that he had the property listed with a major commercial brokerage for over one year, and had not received any legitimate offers. After the listing had expired, he was contacted by the wholesaler, who told him that she wasn’t the ultimate buyer, but she had a buyers list of investors interested in purchasing the RV Park at a certain price. I guess she made a good impression as they signed a contract with a 15 day termination clause. To show seriousness, of a sort, she put up a non refundable $1000.00 for the 15 day option.

I later followed up with the wholesaler, and actually met with her for breakfast. She told me she specialized in RV Parks, Mobile Home Parks, and recreational campgrounds, and did not pursue anything else. She had built up a buyers list of real buyers over the years, and was willing to gamble with relatively small option fees when a seller was willing to price correctly.

Now, it can be argued that she should, or at least could acquire a brokers license. My opinion is that once the real estate commission establishes the requirement for all wholesaling activity to be licensed, they’ll then try to call wholesaling activity “ net listings” and regulate net listings out of existence. My personal opinion is that, just as in lending, a distinction should be made between residential property, commercial property, and investment property. A free and unrestricted market, subject only to commercial laws works best for commercial and investment real estate. On the other hand, nobody wants to see their parents scammed in their old age, and hence some consumer protections in residential property is probably justified.

Hey Don going good  little frustrating  ON our buildling porjects with supply chain..  One week we cant get garage doors the next its shower doors LOL  and appliances are coming after we close the houses sometimes.

With regards to net listings.. I am not sure most folks understand that commissions are negotiable up and down.. I started my sales career in 76 and I sold rural remote lands in Northern CA.. And many of these were 20 30 40 miles into the National forest on dirt roads.. So my fee for those was 15 to 30%  depending on how hard they were to sell..  Most of these wholesalers ( NOT all but many in the bigger east coast and mid west cities) their bread and butter is the lower value assets.. for those same thing I would charge 10 20 30% for the low price points and the hassle factor of rough neighborhoods  the idea is you have full disclosure  ..  I had a builder back in 04 bring me 22 new construction duplexs in Vancouver WA..  he was not selling fast enough bank on his rear..  came to me..  I put together a fly buy program were I advertised in SF Bay area got 300 people to a big meeting room ( gave away Rolling stones tickets..) and I sold all of those that one weekend.. cost me about 25k. and it was risk money if no one bought I was out..  Just like wholesalers who spend 10k more a month with no guarantee of success.  I negotiated a flat rate commission  30k a a duplex.  these sold for 225k each.. Builder got them off his line of credit in 60 days or less and well I made a pretty nice lick there.  But all disclosed and legal ..  I get it that most wholesalers simply dont want the seller or really the buyer to know what they are making since many times they are ripping a ton of equity from unknowing sellers. and couch as helping people  LOL  they believe their own propaganda in that regard..  

Originally posted by @Will Barnard :
Originally posted by @Randall E Collins:

First off, I simply posted a reply to Mr. Watkins as wasn't attempting to start a Wholesaler vs. Realtor argument with the haters. But....

I totally agree, ALL the junk mail, phone solicitation calls, spam emails and text I receive is very annoying. Not just the ones I get from other wholesalers. It's amazing how so many people have my contact information and makes one wonder how they got it. But for a person to single out wholesalers is a bit bias and unjust.

Realtors are allowed to advertise via billboards, Zillow, MLS etc.. Which I find annoying in my search for property because most is being sold by a realtor. I don't complain about it. Every one in the sales market must use some sort of advertising strategy to be successful. Can't knock the strategy wholesalers have to use because realtors have other means locked in.

Wholesale is just as the phrase indicates "Wholesale" not retail price. Realtors shoot for the high retail price and charge the seller for doing so. Convince the seller to set a price that's likely much higher than what a property is actually worth just so they can pocket the extra funds from the buyer. Todays market value and or retail price for real estate is so tremendously high that average people can't even afford the down payment. Forget about the "poor ole" seller. What about the buyer? What about the single mom of three children that can't afford to buy a house and still feed her children. How can any realtor sleep nights knowing they sold a home at such a high price that people are going hungry just so they can have a place to live. Sellers are not as ignorant as a realtor tries to make them. Some refuse to pay a realtor to do what they can do them self. Most will conduct their own due diligence prior to setting a price for their property. Any person with a brain will not sell anything at a price that's much lower than what the item is worth. Unless they are desperate for money, which describes most people in today's society. Unless of course you're a realtor getting wealthy at the expense of others. Some one please tell me again how awful of a person a wholesaler is. We're not the ones that are ripping people off. Sellers or buyers.

I believe the reason why wholesaling without a license is not illegal in most states is because law makers understand the difference between a realtor and a person who wholesales. Sadly others are not intelligent enough to have that understanding. It seems the only people who have a problem with it are realtors. Only because we're making money that their greedy *** could have made. Besides if I did have a license all I'd be is a crook with a license. Enough said.

 I guess you are entitled to your opinion but your examples are so far off, they hold no water. If Realtors are convincing sellers as you state to set a price much higher than the retail value "just so they can pocket the extra cash", this would never work as the buyer's pool is what sets the actual price, not the agent or the seller. An asking price has less to do with the actual value than most know. Picking a higher than market value list price almost always gets you little activity which then results in the need for a price reduction.

Your last paragraph is simply wrong all together. Most states DO have laws that stipulate brokering without a license is illegal, not the other way around, it is just that most wholesalers ignore the laws and do so anyways. That says a whole lot about their industry.

To be as respectful as possible  Randals post is just pure fantasy and no where near how real estate community works.. Geesh does anyone really believe that dribble. 

Originally posted by @Peter Mckernan :
Originally posted by @Will Barnard:
Originally posted by @Randall E Collins:

First off, I simply posted a reply to Mr. Watkins as wasn't attempting to start a Wholesaler vs. Realtor argument with the haters. But....

I totally agree, ALL the junk mail, phone solicitation calls, spam emails and text I receive is very annoying. Not just the ones I get from other wholesalers. It's amazing how so many people have my contact information and makes one wonder how they got it. But for a person to single out wholesalers is a bit bias and unjust.

Realtors are allowed to advertise via billboards, Zillow, MLS etc.. Which I find annoying in my search for property because most is being sold by a realtor. I don't complain about it. Every one in the sales market must use some sort of advertising strategy to be successful. Can't knock the strategy wholesalers have to use because realtors have other means locked in.

Wholesale is just as the phrase indicates "Wholesale" not retail price. Realtors shoot for the high retail price and charge the seller for doing so. Convince the seller to set a price that's likely much higher than what a property is actually worth just so they can pocket the extra funds from the buyer. Todays market value and or retail price for real estate is so tremendously high that average people can't even afford the down payment. Forget about the "poor ole" seller. What about the buyer? What about the single mom of three children that can't afford to buy a house and still feed her children. How can any realtor sleep nights knowing they sold a home at such a high price that people are going hungry just so they can have a place to live. Sellers are not as ignorant as a realtor tries to make them. Some refuse to pay a realtor to do what they can do them self. Most will conduct their own due diligence prior to setting a price for their property. Any person with a brain will not sell anything at a price that's much lower than what the item is worth. Unless they are desperate for money, which describes most people in today's society. Unless of course you're a realtor getting wealthy at the expense of others. Some one please tell me again how awful of a person a wholesaler is. We're not the ones that are ripping people off. Sellers or buyers.

I believe the reason why wholesaling without a license is not illegal in most states is because law makers understand the difference between a realtor and a person who wholesales. Sadly others are not intelligent enough to have that understanding. It seems the only people who have a problem with it are realtors. Only because we're making money that their greedy *** could have made. Besides if I did have a license all I'd be is a crook with a license. Enough said.

 I guess you are entitled to your opinion but your examples are so far off, they hold no water. If Realtors are convincing sellers as you state to set a price much higher than the retail value "just so they can pocket the extra cash", this would never work as the buyer's pool is what sets the actual price, not the agent or the seller. An asking price has less to do with the actual value than most know. Picking a higher than market value list price almost always gets you little activity which then results in the need for a price reduction.

Your last paragraph is simply wrong all together. Most states DO have laws that stipulate brokering without a license is illegal, not the other way around, it is just that most wholesalers ignore the laws and do so anyways. That says a whole lot about their industry.

I agree 100%, the buyer sets the price, and the market is the market is the market. If you sat down with sellers and listed a house for a million in an area with model matches of that house for $500,000 and same condition the seller would never get that price and you would waste everyones time. 

In all my experience with listings is that as the agent/broker we are providing information to the seller, and most of the time the seller comes back and asks us to list for even more money after we do a full market analysis with the seller on what price to list for at that time. So, ultimate between a realtor and a wholesaler the sellers are only going with the professional that can fix their needs the best (price, condition, situation etc.).

Also you dont see a lot of single mothers of 3 buying homes.. unless they divorced their doctor hubby and got a big settlement. 

what he is describing is the million single mother tenants in America and probably more like 50 million.

Originally posted by @Terrell Garren :

Wholeselling - Bugging 10,000 people to find the 1 person that is in a desperate situation and has no idea of market value, realtors or auctioneers.  Then hoping to keep them in the dark until you close and walk away with 40% of their money and claim you rescued them from poverty, misery and life long devastation. 

Yeah, wholescamming annoys me very much and I wish it were illegal in every state. A wholesaler is to a realtor what a pay day lender is to a credit union. 

never made that connection before...pay day lender to credit union....very astute comparison!

Originally posted by @Michael K Gallagher :
Originally posted by @Terrell Garren:

Wholeselling - Bugging 10,000 people to find the 1 person that is in a desperate situation and has no idea of market value, realtors or auctioneers.  Then hoping to keep them in the dark until you close and walk away with 40% of their money and claim you rescued them from poverty, misery and life long devastation. 

Yeah, wholescamming annoys me very much and I wish it were illegal in every state. A wholesaler is to a realtor what a pay day lender is to a credit union. 

never made that connection before...pay day lender to credit union....very astute comparison!

with the exception that payday lenders are highly regulated wholesalers only regulate themselves  LOL

@Will Barnard Well said!!  I was reading that like....last time I checked, even in this market, if I list a property for more than that market will support I'll end up having to drop the price or take an under market offer.  Also last I checked there was no "board of wholesalers" that fined them for not being compliant and ensure they are acting as a fiduciary.   

Is wholesaling difficult in Los Angeles? I've spoken with several wholesalers and I don't think I've once been presented with anything even semi-compelling. I feel like I'd be much better off just searching the MLS for the right property.

I've signed up for listings from some of the larger wholesaling companies in the area....we're talking about companies that have nice offices and supposedly spend huge amounts of money generating their leads. Most of the crap they send me is already on the MLS which is OK, but the crazy thing is that their price is sometimes higher than the MLS list price. WTF?? I'd be much better off just trying to purchase with a regular agent via standard financing. I don't know what kind of suckers are willing to purchase these with cash... I made the decision a while ago that I would do a much better job of finding my own off-market deals.

As for individual wholesalers, I tell them what I'm looking for and they promise to send me some great deals, but I pretty much never hear back from them.

@Anthony Watkins

Wholesaling was never what it was hyped to be. Yes, there's basically no barrier to entry, but there are plenty of barriers to success IMHO. Mainly your advertising budget. A $15K/mo advertising burn rate is common among the top 2-3 wholesalers in this market. I get about 2 mailings per week at home. I've not seen anything that make sense through the MLS or wholesalers in quite a while. On the sales sides it appears the wholesalers don't even care about the numbers working anymore. There are so few properties available that they are "fishing for fools", AKA newbies.

In more simple words. Wholesale price vs. Retail price. Who makes the most money in the sales department? And who's being ripped off, the sales person or the buyer? You think you're getting deal at Wal Mart? Find out how much they paid for the item and you'll have a different opinion. Of course Wal Mart has no full disclosure notice, so we'll never know.

Understood that the wholesale real estate market and the realtor's market if different from the average retail market. However the principle is the same. The retailer is the only one who's wealthy, certainly not the buyer or the wholesale company.

Understood also, there are not many single mothers with children buying homes. Question is why, answer is because it's too darn expensive. If one were to be lucky enough to come up with a down payment and obtain a mortgage/loan. The payments would be so high they wouldn't be able to buy anything else. Hence, foreclosed homes. And more homeless women and children. Alternatively if she could purchase a home at a more reasonable price, from say a wholesaler. She'd likely be able to keep up payments from her job at Wal Mart.

Only for those who say wholesaling is illegal, in Texas at least. Maybe you should read Texas Occupation Code 1101.0045 Equitable Interests in Real Property.

Originally posted by @Randall E Collins :

In more simple words. Wholesale price vs. Retail price. Who makes the most money in the sales department? And who's being ripped off, the sales person or the buyer? You think you're getting deal at Wal Mart? Find out how much they paid for the item and you'll have a different opinion. Of course Wal Mart has no full disclosure notice, so we'll never know.

Understood that the wholesale real estate market and the realtor's market if different from the average retail market. However the principle is the same. The retailer is the only one who's wealthy, certainly not the buyer or the wholesale company.

Understood also, there are not many single mothers with children buying homes. Question is why, answer is because it's too darn expensive. If one were to be lucky enough to come up with a down payment and obtain a mortgage/loan. The payments would be so high they wouldn't be able to buy anything else. Hence, foreclosed homes. And more homeless women and children. Alternatively if she could purchase a home at a more reasonable price, from say a wholesaler. She'd likely be able to keep up payments from her job at Wal Mart.

Only for those who say wholesaling is illegal, in Texas at least. Maybe you should read Texas Occupation Code 1101.0045 Equitable Interests in Real Property.

Texas does have a carve out..  all other states dont..  so when the pro WS crowd says its legal in all 50 states well it simply is not.. at least bringing two parties together for compensation ..  that requires a license. All it takes is one guru or a few on BP to say its legal and thats all many feel they need to go forth .. if Randal says its legal it must be..  right ?