I just made my first two wholesale deal offers

I just made my first two wholesale deal offers

Rental Property Investor · Beverly Hills, CA · Member since 2014 · 472 posts · 272 votes

I just made two offers on two different wholesale deals I had in my pipeline. 

One was for a home worth about $380k and my offer was $215K. The second property was worth around $25-30K and I offered $5K.

The first one was the son of the mother who recently took title when her husband died. He didn't necessarily take my offer poorly, but he said his mother will probably just put it on the market and see what they get. Given the condition and location of the property, if they price it right, I'm sure they'll get much more than what I was offering. Not sure what else I could do there to convince him. I'll probably follow-up in a few weeks and see if they've done anything yet.

On the 2nd property, it was already listed, but it was vacant and title recently transferred to SEVEN of the children. When I made my $5K offer, she chuckled and said she could just give it away without the hassle. I tried to tell her that I wasn't asking her to give it away and that my number includes costs of repairs, etc, but she said no thanks.

Kind of a bummer, but that's how it goes I suppose. On to the next one.

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Residential Real Estate Agent · Groveland, FL · Member since 2012 · 504 posts · 395 votes
11y

I think your offers were right on. I buy this way all the time. Need to know your numbers, find motivated sellers. 

For the one that was listed, you probably presented your offer to a real estate agent. Of course, she calculated her commission. I have never been able to buy through agents. (I am an agent.)

Don't be discouraged. For those who say it can't be done, You're Right! It can't! (Just keep believing that.) I have been doing this for a long time. I know.

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  • Chris K.Pro Member
    Investor · Baltimore, MD · Member since 2012 · 1k+ posts · 655 votes
    11y

    Gotta get some "No's" before you get your "Yes". Keep on truckin. 

  • Investor · Fort Wayne, IN · Member since 2014 · 1k+ posts · 515 votes
    11y

    @Joshua McGinnis while you need to make sure that you have your margins, you cant try to steal a home and last at this game. You say what it is worth is that ARV or present shape? If you are trying to get a home for less than half the value why would they consider? I make my offers off present value, (knowing what the arv will be) and look at my profit, its a different model, but its easier to explain to a seller.

  • Residential Real Estate Agent · Groveland, FL · Member since 2012 · 504 posts · 395 votes
    11y

    I think your offers were right on. I buy this way all the time. Need to know your numbers, find motivated sellers. 

    For the one that was listed, you probably presented your offer to a real estate agent. Of course, she calculated her commission. I have never been able to buy through agents. (I am an agent.)

    Don't be discouraged. For those who say it can't be done, You're Right! It can't! (Just keep believing that.) I have been doing this for a long time. I know.

  • Rental Property Investor · Beverly Hills, CA · Member since 2014 · 472 posts · 272 votes
    11y

    @Jeremy Tillotson Of course. I tried my best to justify my price given that these sellers aren't anxious to spend a lot of time with me on the phone. There's a delicate balance to selling the offer and not going on too much and losing them completely. My prices were based on roughly 65% ARV - Fee.

    @Joseph Ball - I'm 99% sure neither were agents given the background info I received from them on my initial calls. I think you are right in that it is about separating the wheat from the chaff; the motivated from the not. I'll just have to keep at it. Also, they aren't completely dead. I have plans to call them back in a month to see if they've done anything.

  • Investor · Fort Wayne, IN · Member since 2014 · 1k+ posts · 515 votes
    11y

    @Joshua McGinnis I always make offers in person and have a contract ready to sign.

  • Investor · Los Angeles, CA · Member since 2014 · 285 posts · 142 votes
    11y

    @Joshua McGinnis A bit early to say congrats, but you seem all well on your way. Good job! You must have hella thick skin to be making $5k offers!

  • Orlando, FL · Member since 2014 · 152 posts · 54 votes
    11y
    Like the saying goes "if you aren't embarassed by your offer, it's too high"... I don't know how people ever accept the offers that are so low.
  • Rental Property Investor · Beverly Hills, CA · Member since 2014 · 472 posts · 272 votes
    11y

    @Lee L. There are an infinite number of scenarios where people might be motivated enough to take the discounted offers.

  • Residential Real Estate Agent · Groveland, FL · Member since 2012 · 504 posts · 395 votes
    11y

    @Joshua McGinnis You said property #2 was listed? You presented an offer? Even if you presented it to Seller, the Agent would have a say. You can bet the Agent would decline. (I am an agent.). 

    I think, after rehab costs, your $5K offer was a good one. You might consider showing her the rehab costs, and costs of sale, holding costs, days on market, marketing costs, and many breakfasts at Waffle House.

  • Rental Property Investor · Beverly Hills, CA · Member since 2014 · 472 posts · 272 votes
    11y

    @Joseph Ball it was listed, for over 400 days, but I made my offer contingent upon her doing this off-market. 

    I would have been happy to break down the costs, but once I presented the offer, she was taken aback so I had to tread carefully so I didn't lose her completely. There's still a chance that she'll want to sell in a month from now when I call her back and she's yet to do anything with it.

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