How to get on a DFW wholesale list

[John Morgan]

I’m interested in flipping homes now that I got my feet wet with my first remodel. I don’t have the time to go out and find deals on homes that need a lIttle TLC. How do I get on wholesalers email lists for properties in my area (Dallas/Ft Worth area)? And how much do wholesalers usually mark up on purchase prices? I don’t have a problem paying someone 10k or more to find me a deal that makes sense.

[Ryan Blake]

@John Morgan Easiest way is to make a post like this, call on every piece of mail you get offering to buy your home or bandit signs you see, and attend meetings like @Zackery Gholston suggested. The mail you get and bandit signs offering to pay cash for homes are wholesalers trying to find off market deals.

Know that most institutional wholesalers are marking up to 80% of ARV - repairs. Example: ARV of $100,000 x 80% = $80,000. Then take out estimated repairs needed, lets use $20,000. So they would offer this out to you at $60,000. Who knows what they bought it for. Maybe $50,000 or maybe $40,000. They don't just mark it up by $10,000 but instead use the formula above. This means each property will have a different profit for them. I don't have a problem with this at all. If they make $20k, $30k or $50k, good for them. I am only concerned about what I can make. This means you are left with 20% ($20k in our example) to cover your closing costs on the front end, closing costs and agent fees on the back end, holding costs, financing costs, any repairs needed above the estimated repairs, and your profit. If you can make it work with 20%, then you will have a steady stream of properties (probably about 10+ a day) to go over form all the big guys. New Western, Net Worth, Meyers Home Buyers, and Homewood Properties. If not, I would go to the smaller wholesalers. NextEra is one of those. Most of the others don't go by company names and will text you when they have a property come up.

All that being said, know that it is a very tight budget going through a wholesaler right now. This is because of market demand. The formula a few years ago was closer to 70% or 75%. leaving much more room for the investor. This is how a free market works and won't be corrected until the housing market cools off or until investors stop over paying.

I wish you luck and hope you make a killing out there.