How to separate yourself in the wholesale game

Question

I am currently in classes to get my real estate license and I have been doing a lot research in the real estate field. With that being said whole selling keeps catching my eye. I see it as scalable and a way to get into a real estate and start a business. However, I see all the horror stories involving investors and wholesalers. So, my question is how do I separate myself from the rest? What do investors look for? And what steps can I take to start a wholesale career?

Bryant Brislin · Answer

@Chandler Butler if you have more specific scenarios as far as horror stories, let me know.  But when you are sending deals to investors, as long as your assumptions for ARV, repairs, etc are down to earth, and you are an ethical guy, you should do fine.  It's all about putting in the work.  90-95% of the young men who think they want to wholesale, don't end up doing anything, because they think it's easy/fast money, and it's not, it takes some legit work, but you can def scale up and build something awesome if you are willing to put in the work in the first couple of years.  Don't be one of those guys who one month are into wholesaling, then the next month they are into crypto, then day trading, then NFTs, etc.  Pick something and be good at at least one thing before you wrap in the next venture.

Michael Dumler · Answer

@Chandler Butler, maybe another BP member in the Atlanta market can elucidate the legality of holding a real estate license while wholesaling? Is wholesaling while being a licensed agent sanctioned by the GA commission or is it dependent on your brokerage? To answer your question, and what another BP member has already alluded towards, whatever you do decide to pursue, stick with it in the long run. Hopping around from business to business while expecting immediate results is never going to happen. At the end of the day, similar to being a real estate agent, wholesaling is a sales industry that takes time to build validated systems and rapport with clients. To put it simply, what's going to separate you from other wholesalers is bringing legit deals to the table. I've heard far too many stories from investors of wholesalers trying to push weak deals just to get paid and receive their assignment fee, of course, this is not the case for all. Moving forward, first, you need to decide if you either want to be a real estate agent or wholesaler, and second, find a mentor that you can shadow/work for for a year to understand and ins and outs of the industry. Hope this makes sense and helps!

Jerry Puckett · Answer

Hello @Chandler Butler

There is an awesome, epic thread started here years ago by @Will Barnard called "The truth about wholesaling" that should be considered necessary reading for anyone considering wholesaling. It is a long read, but the first two pages alone will give you all the information you need to avoid horror. Totally worth it!

I say that with confidence because that thread came out when I was a fairly green pip squeak wholesaler, and that information helped me transform and grow my business. I'm still here here 10 years later while I've seen hundreds of others crash and burn. Getting your license is a GOOD THING. It will serve you well and give you at least two bites at every single apple.

Brenden Mitchum · Answer

Hey @Chandler Butler

Getting your license is a great first step to separate yourself from the crowd. Most wholesalers I speak to here in Atlanta don't have their license. It will also allow you to work for large wholesale brokerages, which is a great way to get started. Plus, there's a chance that, like other states, GA may one day require a license for anyone selling real estate. Better to already have it than scramble for it later..

Most investors just want a partner to help them find great deals. If that's who you are, you'll do just fine. However, if you're just in it for the $$, you'll find yourself as the subject of those horror stories. Work hard, do the right things, be a genuinely nice/friendly guy & investors will love working with you.

And please, feel free to reach out anytime!

Terrance Clark · Answer

For me personally, I do choose not to wholesale anymore as a licensed agent I am okay with using a compensation agreement to leverage the desired commission. It's usually not huge paydays like the wholesale checks you see on the internet, but the seller usually walks away with more because I am putting them directly in contact with the end buyer.

I use a platform at my brokerage called ExpressOffers and it is designed to attract the same target as wholesalers.

One thing you can learn from wholesalers is the way they market their offerings! They are usually so much better at going out and getting their food than agents. I use a lot of the same targeted marketing strategies but as an agent.

Steven Foster Wilson · Answer

Hi Chandler,

I know this might be a cliché answer but I have found that just being honest and upfront with investors has really helped me. I like to go by the saying,”honesty is the best policy.” I have also found that persistence is key. The times I have thought not to call the seller again because I thought they were busy or I made up some other excuse in my mind. That was when I lost the deal. It’s always good to be persistent and keep the relationship going.

Chris Mills · Answer

All good responses here. I want to highlight the common threads of being in touch and in tune with your developers, and knowing your stuff. As you're realizing, wholesaling has a low barrier to entry which is good and bad. Knowing your numbers, knowing your market, and being good at what you do will make you stand out just because there's so many fly by night wholesalers. Be patient and hardworking, and you'll develop a reputation in your market in no time. Best of luck to you.

Eliott Elias · Answer

What's going to separate you is knowing what your client's needs are. Many wholesalers are good at finding the deals but are left scrambling when looking for the investor. Build your buyers list first, meet your investors, then bring on the deals.

Jon Kelly · Answer

@Chandler Butler This is the exact question you should be asking.

I'm an investor, so this is only from an investor's perspective. I enjoy working with wholesalers with the following qualities:

1. Understand and be realistic with your numbers. DO NOT tell me a shack in the woods has an ARV of $200k... Really get to know your market and understand the true value of properties. Even better if you can provide a rough ballpark of rehab costs

2. Maintain a relationship. Your buyer's requirements may change over time. Consistently reach out to your buyers with new opportunities. As a buyer it's always good to know what inventory the wholesaler has. If the wholesaler shows me 1 property every 9 months I may not trust them too much.

3. Find good deals. Nothing happens without finding good deals.

How to separate yourself in the wholesale game

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