Should I gather a buyers list first before i start wholesaling?

Question

Good morning fellow BP members, My name is Mack Campbell i am a neophyte investor as well as my partner in this joint venture we are about to start. I tried to talk him into picking an area to study the market but he suggested we get our criteria from a buyer and look for what they want.

John Thedford · Answer

Account Closed

I didn't watch the podcast. It seems someone should try and get everyone to use FLIPPER for those buying and reselling, and "wholesaler" for those trying to assign contracts. There are several states that have addressed the assignment game, and FL has as well. Using contracts to circumvent licensing in FL is not legal. Furthermore, advertising properties unless owned or licensed is illegal in FL as well. This makes it almost impossible to "wholesale" in FL unless licensed. The two terms do cause confusion for all the BP readers. One can build a "buyers list" in FL, but then what? When they advertise the property, or blast out emails (advertise the property) they run the risk of getting caught. This is why most of these unlicensed brokers hide in the shadows. They know they are operating illegally. Why make it difficult? Buy, rehab, sell. No license needed and no violation of law.

Account Closed · Answer

@John Thedford  The OP in that post @Brett Snodgrass  was on Podcast 231 talking about the right way to wholesale; buy/get on title, and sell. It's actually one of the better podcasts on BP and should be a must watch for new "wholesalers"!@Mack Campbell  Have a listen to that podcast if you haven't already!

Brendan Bruno · Answer

I have asked this question before as well, and the advice given to me was to join local investors club(s) and also to attend local auctions in order to connect with anyone who is buying. Get their card, tell them you are a local investor as well. Don't make it a long conversation but definitely ask what they are looking for.

Best of luck!

Bryan Pham · Answer

Its definitely a game of which one came first. the Chicken or the Egg. In my opinion its always good to have both going on at the same time.

Brett Snodgrass · Answer

Account Closed thanks for the props on podcast 231!  God bless!

John Thedford · Answer

There is generally a problem with "wholesaling". Most people that teach it DON'T touch upon some serious issues:1. are you prepared to close if you cannot find a buyer. Disregard the frauds that suggest BS escape clauses. If they are teaching others to lie, what does THAT say about them and their "game plan".2. many states are cracking down. What many of these gurus don't point out is that many of these actions are skirting state laws. As James pointed out, getting licensed and being fully legal is easier...which makes your entire business easier, less stressful, and just as importantly, 100% up front and honest.3. If you sign contracts with no ability nor intention to close, this is called FRAUD BY INDUCEMENT. Many of these "wholesale" gurus either skip this fact, and/or some actually propose it (but never mention the word FRAUD).BP has seemed to build a large base of clueless "investors" that believe they can walk around, sign contracts with no ability, no cash, etc, and make a ton of money. NOT TRUE in 99.9% of cases. It definitely lures people because they don't have money, no real RE education, etc and believe it can change their life. It won't. I am well known on the BP board for my feelings about "wholesaling" and the fact is, I haven't had anyone with a LEGITIMATE argument disprove my posts concerning this. FLIPPING is NOT "wholesaling" and is entirely different.

BTW---check out this thread:https://www.biggerpockets.com/forums/93/topics/475...

Note the OP is silent on my post. Nothing personal, but I felt the post IS relevant because the OP is promoting "wholesaling" on the forum. Wouldn't it be nice to know if they are promoting HONEST business...or the typical scam?

James Wise · Answer

Welcome aboard @Mack Campbell

First I would scratch off the idea of wholesaling. Horrible business plan & likely against license law in your location.

Next I would become a licensed agent & begin to do what you were already planning on doing....Find people who want to sell their home.

Think If you build it they will come. What this means is that if you list it they will come. Find sellers, who will list the property with you. This will bring in the buyers automatically.

Mack Campbell · Answer

Thankyou both for the input I will constantly update my progress and post more question along this journey

Brittany Goss · Answer

Hi, Mack! I am also interested in wholesaling and my approach is to join a local investor's club and build your buyer list beforehand. You can ask your buyers what they are looking for and it should help you find deals. I'm a newbie, but my research has shown me that having a list of buyers ready to go will make the process smoother. I am interested in seeeing what more experienced BPers have to sway about the subject.

Best of luck!

Should I gather a buyers list first before i start wholesaling?

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