Hello Bigger Pockets' Investors,
I am starting real estate investing as a wholesaler. I am slightly overwhelmed because I hear a lot of seasoned investors say learn your market. I believe it is a vague statement. What information is important for researching a market? Where is the best place to find information regarding the market?
I have researched different aspects of particular zip codes such as what percentage of residents are renters in the neighborhood, how much is the average rent in a particular zip code (rent-o-meter and City of Minneapolis website), the price of homes that sold in April (Zillow) and interest rates.
- Job Diversity
- Age Demographic
- Supply and Demand
@LaQuadra Neal if you’re looking to get into wholesaling then you really need to know the comparable sales of your area. This comes down to more than just price you need to know what types of homes so with what types of finishes are needed for example granite versus laminate countertops. You have to know how important bedrooms are to the sale and style of home, also what are the ideal number of bedrooms in your market, price range, and style. How important is a garage? You need to really get a feel for what makes up the value in a particular home in your area. It’s not difficult to do, it just requires a some Internet research and actually going to properties that are for sale and following them through sale to see how long it takes for them to sell and at what price.
The reason people keep saying "know your market" is because investors will write you off quickly if you are sending "deals" out that are way overpriced and your numbers are wrong. To make money as a wholesaler you have to add value. You have to find deals that the investor doesn't have so they can make money. If you present them bad deals you are simply wasting their time, this is why you need to learn your market.
The above posters gave you some good advice. If you are sending me a wholesale deal I expect that you know what the house is worth, I expect the price to be adjusted for any needed repairs, and If you give a rehab estimate you better have some thinking behind it. What I don't want to see is a $500k duplex in NE needing a full gut job with a rehab estimate of $5k....
Thanks for your feedback!