Is Wholesaling risk free ? LOL

[Greg Helbeck]

I recently had a wholesale deal get quite interesting a few weeks ago so I figured I would try and are with everyone the backstory and the mistakes and lessons I learned so you can try and avoid them in the future.

I got a good call from a prospect in Westchester County, NY and I contracted the house sight unseen from my house in California.

On the surface, it looks like a pretty good deal. So when I was back in New York a few weeks later, I decided to go check out the house in person.

After looking at the house, I decided that based on my situation, this would have been a very good property to just sell to another investor (wholesale)

I immediately knew I was in trouble once I started to market the property out to other investors because I had the it listed way too high and no offers right away.

After a few days, I finally found an investor to buy the property and we agreed on a specific price.

One week before the closing we all realized there was no way that we could have moved forward with the transaction because it was too risky.

We had no choice but to go back to the seller and renegotiate the purchase price. (Something I HATE doing)

The main issue we had on this transaction was that I did not know that the city was a " block to block" city.

This just means that it's a lot tougher to value properties because one street could be extremely nice and then you can go down the road and be in a war zone.

After we got all of the mess sorted out, we ended up getting a price reduction and we are going to move the deal forward.

Here are my top three mistakes.

1. On this deal, I was only banking on one exit strategy ( wholesale) and because I had all my eggs in one basket, I almost dropped the basket. Because I only had one exit strategy, I had no leverage when trying to sell this property because I really need to sell it.

2. When buying a house that's expensive, always try to get somebody to take a look at it before you make a final agreement on the phone. I got too excited to buy this house and because I did not physically see it or have someone on my team physically see it, I ended up spinning the seller's wheels and had to come back in for a price reduction.

3. I did not fully understand this market and that screwed up all the numbers that I was basing my investment on. Next time, I will understand the market much better so I can avoid this mistake in the future.

If you ever interested in finding out how you could work with my company from a few different angles, feel free to reach out to me and we can see if there's some potential to work together.

Greg