How long did it take to get your first?

Question

Hi Everyone!

I was wondering how long it took you that wholesale to do your first deal? I have been doing this for a little over 2 months with little luck.

I have made a lot of contacts, have been building my buyers list and plan to start my first mail campaign this weekend. Sometimes I get frustrated and feel like I am making no real progress.

I would like to know how long it took for you to get your first deal. 6 months ago I never knew a thing about wholesaling or REI in general. Is it wild to expect to get a deal this quickly?

Thanks!

Jon Holdman · Answer

Ben, If I were on your buyers list, I'd be concerned about one thing only - bring me a deal.  I don't care what you're focused on, nor on you're wanting to help people, not what you want to do with the money.  If you started talking to be about that stuff, I'd lump you into the "I've been to a guru seminar and going to make a fortune and save the world with wholesaling" category.

Ask me my areas, my criteria, and then find me a deal that fits that criteria.

Since you have a few buyers, your focus should be strictly on finding a deal.  Marketing of some sort, door knocking, making a dozen lowball offers on MLS properties every day.  SOMETHING to find a deal.

What sort of deals have you turfed up?  If you've been at it two months, you must have had a call from a seller or two.  Why didn't those pan out?

Ryan Webber · Answer

It would depend on how much time and money you are putting into finding deals.  The degree of passive and proactive marketing you are doing is going to make a huge difference.

If you are spending an hour every couple days looking for deals, its going to take awhile.  If you are putting in 4-8 hours a day diligently looking for deals then I would say within a month you should have your first deal.

If you are starting off with a $100 budget for marketing then you should expect that your cheap marketing strategies will take longer to generate a deal, but if you are dropping $10,000 on the right types of marketing then you should have a deal next week.

I found my first deal within about a month of getting started by just looking through the newspaper and on the MLS with no marketing at all.

Demos Loizides · Answer

Ben - I get deals from the following:
- ads on Craigslist
- people contacting me directly from my website
- bandit signs

Although I do direct marketing with postcards, I haven't gotten a deal from them yet.

I have also gotten a lot of motivated seller leads that I didn't want, because they were upside down and I don't do short sales. You don't have to put an offer on every lead you get.

Luis - I don't think Sub2 deals are the kind of deals Ben should be doing at this early time in his career. They're risky.

Demos Loizides · Answer

Ben - the 3 "deals" you talked about all had little or no equity. That's the problem right there. You need to find houses with close to 50% equity, or refer them to short sale experts.

Jon Holdman · Answer

If you find an agent who will work with you, and who uses electronic contracts, you can easily churn out dozens of offers.  Low likelihood of acceptance, but its a potential source of a deal.

One wholesaler in our area who actually consistently has properties gets quite a few of his deals from HUD.  Those are all on the MLS, and all go through the bid process.  I've had another guy tell me he was also having some success with that.

Another wholesaler who seems to get a fair number of deals is the local Homevestors franchisee.  They advertise a LOT.

I see a lot of bandit signs.  Don't know if they work or not, but I do see them.

Direct mail is a long term proposition.  Plan on sending multiple pieces to the same prospects.

Out of area owners, and non-owner occupied properties are candidates.

Code violations and fire damage are candidates.

Calling for rent signs can work both ways.  You might find the disgruntled landlord who's interested in selling or you might find a potential buyer.

I believe wholesaling is MUCH more difficult than the gurus lead you to believe.  I've not even tried because I think its just a JOB same as (and a lot like) selling used cars.  Make a deal, you get paid.  No deals, you don't.  I have a regular job that pays me pretty well and that I'm pretty good at.  I don't really want to take on another one that requires a lot of people interaction (not my thing) and that I don't know very well.

Brian P. · Answer

Ben

It can be any amount of time. I've known investors lucky  enough to connect on  day one  and others over a year. But it is not time that counts, it activities that count.

If you tell me you put in 20 hours a week the first question I'm going to ask is doing  what and why. Amount of time is relative.

Once when I was an executive with a blue chip  company I had an employee come and ask me for a raise. I asked him what he thought he was worth an hour.and he told me. I responded he was already making much more then that.

I told him he only worked 50% of  the day so he was making twice what he thought he was already making and when he started working full time we could discuss a raise He objected and I outlined his typical week. He showed up for his 40 but worked at his job for half that.

And that is the way it is with many investors. Set goals for prospecting production and keep track. If someone tells me they contacted face to face so many possible leads, that means something but telling me they put in 4 hours means nothing. I know an investor that loves to talk and he can spend the day with one lead so he had one contact with one prospect not the 8 hours he thinks he worked.

My thoughts keep building your buyer list but also qualify them. A list of a 100 buyers that can't deliver is useless, but a list 2 that can is worth something. And pick one good source of prospects and work the hell out of that source and when its in place add another. Don't be like the hunting dog that chases every leaf that the wind blows.

Just me, but I would take a second look at that assisted living property. I did a couple of those that other investors had passed on and they turned into profitable deals..

Jose R. · Answer

Ben, Its good to see that your taking action!  Don't feel bad, it took me 2 years to do my first deal.  But when it came, I was ready.  
          
          During those 2 years I've passed on MANY properties!  For me, my number one concern was not losing my investors money.  On my first deal my investor made a 50% return on his money within 3 months plus have of the profits!
          
          My saying is a motivated buyer eventually becomes a motivated seller! 
          
          Don't worry about it, just take action, evaluate your results, then make adjustments.
          
          Hope that helps!

Matt Kearney · Answer

Hi Ben,

It took me over a year to do my first wholesale deal. I was still in college at the time... so I had some other commitments keeping me busy.

After that first deal it then took me another year to find my second deal, which was a property that I rehabbed.

I like what someone else suggested, do at least one thing every day that puts you closer to finding a deal. I wasn't doing this early on in my investing business, now my main focus is on finding deals. It's all I think about and all I wanna do! :D

Ben L. · Answer

Hi Demos,

I agree with you completely. The poor deals are a result of the poor job I was doing marketing and calling on the wrong crowd of sellers.

I am learning as I go and realize that I have a lot more to go through before i understand it all. Luckily I have this board and a good local group who are willing to help.

Would you care to share your marketing strategies that help find your deals? As I mentioned above my first mailing will start witha letter followed up with postcards to owners behind on their taxes.

Thanks.

How long did it take to get your first?

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