Wholesaling may not be for you...

[Ethan Neumann]

Wholesaling seems to be this glorified way to get into real estate. Big "gurus" make it seem like you can become an overnight millionaire with no money out of pocket and no credit. While this is possible, with time, they don't tell you about the "dark" side of wholesaling.

1. It's hard to be profitable - A lot of wholesalers like to flex how many deals they are doing or how many assignment fees they have collected. That's great and all but you know what they don't talk about? They don't talk about how profitable their business is... how much they're actually putting in their pocket. Do you know why? Well, because a lot of wholesalers either don't realize they have to treat wholesaling like an actual business, or they get addicted to the "big" number (gross income) and don't focus on what actually matters (net income).

Get your systems right, track your numbers, be smart with your money, get educated. All of these things will help you create a PROFITABLE wholesaling company, not a money-sucking machine.

2. It does take money to start or at least to scale - A lot of gurus are talking about wholesaling take no money and no credit!! Now I know you can get a deal for "free" using a few different methods. But what is free in money is not free in time. If you actually want to create a wholesaling business that is worth your time and generates the income you probably desire, you're going to need to put in some cash. Data is expensive, the software is expensive, labor is expensive. You can't create a scaled wholesale operation by driving for dollars, using "true people search" and calling with your cellphone. Although that may be a good place to start, the time it takes to get there will be longer than you are initially anticipate. (most likely much longer)

Now I know this isn't the case for everyone, some people get deals quickly, but very few. If you want to really get started and hit the ground running, put some money into the business. Get a dialer, buy a list, hit the phones!

3. It is extremely active - You are not going to get rich overnight with wholesaling and it is certainly not going to be easy. The people who actually make it in this business are hustlers. They get up every morning ready to attack the phones, hammer follow up, and create a solid foundation of systems. That takes time.... a lot of time. I used to hit the phones from 9 am to 8:30 pm and spend all of my other waking hours educating. Wholesaling takes consistent effort and effort takes time.

Now once you build up your pipeline and have deals rolling in, you can now start to delegate activities, but your job isn't complete. Now you have more leads coming in, how are you going to handle all of these leads? How are you going to manage your CRM? How are you going to organize your data? How are you going to manage these people?

There are evolutions to your business, and just like every other business, it will take a lot of TIME to create something special.

I say all of this to give people a heads up before getting into this business. If this post deters you from starting your journey, that journey may not be for you. However, if you know this journey is going to be one of the toughest things you've ever done and you still want to take the leap.... you already made it, time just hasn't caught up yet.