How to get into Wholesale

Question

Hello! I am Kaden Flores, I live in the Flint, Michigan area as well as Cookeville, Tennessee. Real Estate has always been a goal of mine since getting out of high school 2 years ago, however I never knew how to get started or what field would be most suitable for me. I have come to realize that wholesale has really grabbed my attention and is an aspect i believe i could thrive in. Any tips about any step of landing a contract would be much obliged!

Kaden Flores · Answer

Thank you for the invite! I will be checking my Facebook to make sure I can join that.

Izaiah Barba · Answer

Hey @Kaden Flores, great question. My business partner and I have been successfully utilizing wholesaling as an exit strategy for the past three years. To share our journey and insights, we’ve created a Facebook group where we offer valuable resources for free, including guides on contacting sellers and running the numbers on deals. If you’re interested, I’d love to invite you to join! We’re always happy to help and support others in their real estate journey.

Andrew Syrios · Answer

Wholesaling is a tougher business than many make it out to be. You will need money for marketing so don't think it's free. And you'll definitely want to get out and network with potential end buyers (here on BP but also in places like your local REIA).

I wrote a piece on wholesaling from end buyer's perspective you might find helpful. Here it is if you want to check it out: https://www.biggerpockets.com/blog/buy-deals-from-wholesaler...

Drew Sygit · Answer

@Kaden Flores How much work are you prepared to do?

Per this NY Times article, the average American knows around 600 people.https://www.nytimes.com/2013/02/19/science/the-average-american-knows-how-many-people.html#:~:text=The%20average%20American%20knows%20about,do%20you%20know%20named%20Kevin%3F

Per the US Census Bureau, the average American moves 11.7 time in their life, which based upon an approximate lifespan of 84 years, works out to be about every 7 years.https://www.census.gov/topics/population/migration/guidance/calculating-migration-expectancy.html#:~:text=Using%202007%20ACS%20data%2C%20it,one%20move%20per%20single%20year

So, if the average American knows 600 people and they each move about every 7 years, that means that the average American knows around 85 people that move in any given year.

How many of those moves do you want to be involved in?

To maximize the number of transactions you’re involved in you will need to:

• Be Top of Mind when they think about moving - which requires consistent reminders.
• Be seen as an Expert – which requires a consistent message and Evidence of Success stories
• Gain their Trust – which requires communicating integrity

So, start out by listing everyone you know in an Excel spreadsheet.

Why Excel? Because later, you can easily use it as your mailing list! Create columns for Name, Street Address, City, State, Zip and then contact info: Last Contact, Relationship, Status, Email & Phone.

IMPORTANT: do NOT ask people for THEIR business, ask for referrals! Why? Because they will get defensive if they feel you are pressuring them. Remember, they can always refer themselves😊

Now, make it a goal to call at least 5-10 of these people EVERY day and ask a MAX OF THREE off the list below of who they know that:

• Just inherited a home
• Had a loved one pass away
• Is behind on their mortgage or tax payments
• Has a relative that can’t take care of their house anymore
• Has a house they’re having trouble selling
• Is facing bankruptcy
• Knows a probate attorney
• Knows a bankruptcy attorney
• etc

Why only three off the list per contact? Because on average, we can only remember three things at a time. If you try to go over the whole list, you’ll lose the attention of an average person and they won’t remember anything!

It should only take you about a month or two to contact everyone on your list and then the tough part – you start all over again.

Why the repetition? Because it takes repetition for people to remember things and you have to be top-of-mind when they encounter a potential client for you!

Have you ever been to McDonalds? Of course you have! So, why is McDonalds still spending billions on advertising?

One more tip – people remember stories that trigger their emotions. So, tell a story of how you (or a fellow wholesaler) helped a seller out with their challenge(s). Change your story each month as different stories will resonate with different people AND use each story to emphasize one of your “who do you know…” questions.

As you start closing deals, you will need to reinvest your profits into mailing lists and other scalable activities to grow your business.

One last thing – we recommended you create a Status column on your spreadsheet, now we’ll explain why. If you find someone that seems to know a lot of people needing your services, wouldn’t it make sense to focus more resources on them? Conversely, you will run into people on your list that just seem to be a waste of time, so you’ll want to avoid them. So, create status codes for both of these and a few in-between codes to help you work smarter, not harder.

How to get into Wholesale

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