Is wholesaling dead?

Question

Hi all,

I'm a newbie to real estate investing (wholesaling) but fairly experienced in business.  I own a company outside of real estate that does well (I sell to Walmart, Home Depot, etc.)

With that, I am interested in wholesaling because I am interested in the concept and it works with my expertise (marketing).  With fierce competition, low barriers to entry and a changing real estate market, can you still make a living these days wholesaling?

I'm not looking for a get rich quick scheme and I have money and expertise for marketing.  Is wholesaling still a viable business if backed by money, expertise and hard work?  Is anyone out there clearing 30k+ a month profit strictly wholesaling?

I'm curious to hear your thoughts before I get too deep.

Thanks.

Aaron Mazzrillo · Answer

I wholesales 2 properties today. My WSF for both is, well let's just say - considerable. I see you are in Tampa which probably means you are possibly infected... Influenced.. by a certain local guru who I won't name, but Preston's whole "wholesaling is dead" marketing campaign was pretty stupid IMO. Even though lots of tools probably fell for it and bought his courses.

Ned Carey · Answer

No wholesaling is not even close to being dead.

Absolutely yes!  As you mentioned thee is a low barrier to entry. While this may lead to a lot of competition, it does not necessarily lead to quality competition.  Usually when I gt direct mail to purchase one of my properties, no one returns my call.

Now the above is not to imply it is easy, it is not. But if you do what successful investors do frequently enough and consistently enough you too will be successful.

David Rundle · Answer

Yup - Wholesaling is dead.  Less competition for me :).

In reality, this business isn't dead and even though the barrier to entry is low, the actual expertise, salesmanship, marketing capability and human networking ability needed to complete a deal is not low.

This business is like a snowball, once it starts rolling it's damn near impossible to stop.

Phil B. · Answer

I will admit I did sit on the local guru's webinar last week.  I take all that stuff with a grain of salt.  I've been around the block a few times and have bought a few personal homes over the years.  However, the local guru made a few good points but even with that (mostly scare tactics if you ask me), I don't think Wall Street will influence this type of business as much as he is trying to lead us to believe.  I'm also an ex-stockbroker and trader.  I have a pretty good grasp of how Wall St. and hedgefunds work.  Wall St. might WANT to participate but its not very reasonable.  The amount of money they supposedly seek to inject into wholesaling would take thousands and thousands of individuals doing one deal at a time.  I don't think it is very realistic.  This niche (and supply) is just not large enough for Wall St. who has to do everything on a grand scale due to the amount of money involved.

I asked what I did above not because the local guru planted thoughts in my head, rather, its something I've been meaning to ask for a while as I start setting up my business.

There are so many books out there that make this seem like a get rich quick scheme but my experience tells me otherwise and I wanted to hear from people who are actually doing it.

From the outside looking in, it appears there are two distinct types of wholesalers:  1.  The perpetual amateur who makes a few bucks here and there and puts in a less-than-full-time effort.  2.  The professional who really treats his or her business as a business and understands it takes money, time and commitment.  Ned - I agree with your analysis about competition.

I'm planning on a real business.  I've already invested a few thousand dollars on signs and leads and some marketing materials.  Before I "go big" so to speak I wanted to hear from others who really work a system in a strategic, full time effort.

Thanks in advance for your replies.  Its nice to know there are folks still doing this and making money for the effort.

If there are others in and around Tampa who would like to partner/share/exchange/anything, I am completely open to making new connections and meeting others in the industry - PM me.

Thanks for the input so far.

Mary B. · Answer

Wholesaling will not ever die as long as there are rehabbers looking for discounted properties to fix and flip. So long as you are in / working a constant developing housing market... its a go. However, I will suggest that you should learn other aspects of real estate investing at least one. Whatever that choice is all on you but definitely venture into something in addition to wholesaling.

Kudos,

Mary

Is wholesaling dead?

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