A fellow real estate investor made the comment recently that “wholesaling is dead. No one can get any money, and there just aren’t any good deals out there”. He had just thrown in the towel where wholesaling houses was concerned, and he had decided to move on to another strategy.
Well folks, that just isn’t true. Wholesaling houses is alive and doing well. There are plenty of deals out there. While it definitely is harder these days for investors to get financing, it’s far from impossible. There are also still plenty of folks out there that have access to cash. Almost all of my buyers are cash buyers.
One of my goals for 2010 was to build my buyers list; to add more quality buyers. I specifically wanted to add more cash buyers; and I have managed to do that. Does that mean the job is done? No way! Building your buyers list is an ongoing process.
Once you have a good buyers list, you need deals to sell them. Not just good deals; deals that are somewhere between great and smoking hot. Finding enough motivated sellers can be tough at times. So how do you do this?
Marketing, Marketing, Marketing
You need to ramp up your marketing efforts. More leads equals more deals. Also, I believe you have to try to uncover the seller’s hidden motivation even more these days. They all want money. But, what else do they want? Believe me there is always something else. The best way to uncover that hidden motivation is just simply to listen. Listening is something that I work on all the time. I am so passionate about what I do, that sometimes it’s just hard to be quiet.
I’m working with a seller now; an absentee owner that has her personal house for sale as well as two houses that are part of estates. One of those houses is located where I live. I looked at the house a couple of days ago, and it is a great two story house with a full basement and a one car garage. The home also has a huge yard. That is the good part.
The bad part is that the house is located in a blue collar neighborhood where the property values have gone down like a lot of other areas. Sellers just don’t like to hear you say this. Oh, they know that it’s true; they just don’t want the information to apply to their house.
This house needs a lot of updating and about 25 new windows. In addition to that, the day I was at the house there was quite a bit of water in the basement from the heavy rains we have had. I simply asked this friend what she knew about the house, and I listened.
The friend showing me the house told me that this particular basement had flooded several different times. She also gave me some other information about the house that I could not have known otherwise. All in all, I spent about an hour at the house. Most of that time was spent listening to her tell me about the challenges she has had in her life in recent years. I also heard about a lot of other things such as the home she grew up in. But I gained some very valuable information that day about the property. Information the seller most likely wouldn’t have been willing to share with me.
I’m going to make an offer on the house today. I have a seller with three houses in different states. Just how motivated is she? I’m about to find out. And about that question, “Is wholesaling dead?” Definitely not!