Any Wholesalers closing 2-5 deals a month ?
New to Real Estate · Columbia, SC · Member since 2016 · 96 posts · 21 votes
Any Wholesalers closing 2-5 deals a month ?
Most Popular Reply
Developer · Philadelphia, PA · Member since 2013 · 1k+ posts · 902 votes
7yOriginally posted by @Tyron White:
I see a lot of negative comments about wholesaling on here for some reason.
So I was just curious is there any wholesalers consistently closing 2-5 deals per month ?
If so maybe you can shed some light on your success
I can't speak to the deal flow/closings but I can tell you why wholesalers get a bad rep, at least in my opinion.
It's touted by many as the lowest barrier to entry to get into REI when in reality, to be done well, it's likely one of the highest level skillsets out there. You have to be a master marketer and negotiator, know contracts, as well as your market, extremely well including ARV's, rehab and new construction costs, zoning, rental rates, and any other goings-on that may impact values or rents either negatively or positively. You also need to be a master networker to build your buyers list and know who buys what in what areas as well as know how to work through the incredible amount of issues that come up in a transaction like probate, deed fraud, and liens just to name a few. At least in Philadelphia, you may have to deal with and navigate multiple governmental departments. You need to be able to communicate with people from all walks of life and build rapport with them. You need to act with integrity on both sides of the transaction when most wholesalers are lying to the person that they're "buying" from telling them they will personally buy their home in 30 days with cash when in reality they have every intention of walking away if they can't find a buyer, leaving the seller possibly in a terrible financial position.
In my experience, most of the "wholesalers" I run across send a few postcards, hang some plastic trash on telephone poles that neighbors have to clean up eventually, and offer way too much money on a property then call you up and say they've got a "deal" for you. They are clueless as to the costs to purchase a property, hold it, develop it, and sell or rent it, and don't understand why you won't take their amazing "deal" they landed. This just makes it harder for everyone when sellers have a stack of 100 "we buy houses" postcards on their coffee table from everyone that claims to buy houses in cash in 30 days.
I know that's not the question you asked directly but if you're unaware of why wholesalers get beat up on BP, there's a few reasons off the top of my head for you.
86 Replies
- Developer · Philadelphia, PA · Member since 2013 · 1k+ posts · 902 votes7y
Originally posted by @Tyron White:
I see a lot of negative comments about wholesaling on here for some reason. So I was just curious is there any wholesalers consistently closing 2-5 deals per month ? If so maybe you can shed some light on your successI can't speak to the deal flow/closings but I can tell you why wholesalers get a bad rep, at least in my opinion.
It's touted by many as the lowest barrier to entry to get into REI when in reality, to be done well, it's likely one of the highest level skillsets out there. You have to be a master marketer and negotiator, know contracts, as well as your market, extremely well including ARV's, rehab and new construction costs, zoning, rental rates, and any other goings-on that may impact values or rents either negatively or positively. You also need to be a master networker to build your buyers list and know who buys what in what areas as well as know how to work through the incredible amount of issues that come up in a transaction like probate, deed fraud, and liens just to name a few. At least in Philadelphia, you may have to deal with and navigate multiple governmental departments. You need to be able to communicate with people from all walks of life and build rapport with them. You need to act with integrity on both sides of the transaction when most wholesalers are lying to the person that they're "buying" from telling them they will personally buy their home in 30 days with cash when in reality they have every intention of walking away if they can't find a buyer, leaving the seller possibly in a terrible financial position.
In my experience, most of the "wholesalers" I run across send a few postcards, hang some plastic trash on telephone poles that neighbors have to clean up eventually, and offer way too much money on a property then call you up and say they've got a "deal" for you. They are clueless as to the costs to purchase a property, hold it, develop it, and sell or rent it, and don't understand why you won't take their amazing "deal" they landed. This just makes it harder for everyone when sellers have a stack of 100 "we buy houses" postcards on their coffee table from everyone that claims to buy houses in cash in 30 days.
I know that's not the question you asked directly but if you're unaware of why wholesalers get beat up on BP, there's a few reasons off the top of my head for you.
- New to Real Estate · Columbia, SC · Member since 2016 · 96 posts · 21 votes7y@Troy S. Yeah I get what you're saying most wholesalers aren't really doing what it takes to be great at actually wholesaling so it suffers a bad rep I get it. Thanks for your insight
- Real Estate Agent · Sacramento/Placer ~ San Francisco Bay Area counties · Member since 2012 · 1k+ posts · 743 votes7y
Originally posted by @Troy Sheets:
Originally posted by @Tyron White:
I see a lot of negative comments about wholesaling on here for some reason. So I was just curious is there any wholesalers consistently closing 2-5 deals per month ? If so maybe you can shed some light on your successI can't speak to the deal flow/closings but I can tell you why wholesalers get a bad rep, at least in my opinion.
It's touted by many as the lowest barrier to entry to get into REI when in reality, to be done well, it's likely one of the highest level skillsets out there. You have to be a master marketer and negotiator, know contracts, as well as your market, extremely well including ARV's, rehab and new construction costs, zoning, rental rates, and any other goings-on that may impact values or rents either negatively or positively. You also need to be a master networker to build your buyers list and know who buys what in what areas as well as know how to work through the incredible amount of issues that come up in a transaction like probate, deed fraud, and liens just to name a few. At least in Philadelphia, you may have to deal with and navigate multiple governmental departments. You need to be able to communicate with people from all walks of life and build rapport with them. You need to act with integrity on both sides of the transaction when most wholesalers are lying to the person that they're "buying" from telling them they will personally buy their home in 30 days with cash when in reality they have every intention of walking away if they can't find a buyer, leaving the seller possibly in a terrible financial position.
In my experience, most of the "wholesalers" I run across send a few postcards, hang some plastic trash on telephone poles that neighbors have to clean up eventually, and offer way too much money on a property then call you up and say they've got a "deal" for you. They are clueless as to the costs to purchase a property, hold it, develop it, and sell or rent it, and don't understand why you won't take their amazing "deal" they landed. This just makes it harder for everyone when sellers have a stack of 100 "we buy houses" postcards on their coffee table from everyone that claims to buy houses in cash in 30 days.
I know that's not the question you asked directly but if you're unaware of why wholesalers get beat up on BP, there's a few reasons off the top of my head for you.
I agree with you regarding the issues of probate...
- 7yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
there are for sure wholesaling companies doing that volume.. but these are for real companies with offices large marketing budgets 10 to 30k a month type.. a couple of full time agents working for them.. etc etc.
someone doing this on their own .. with no support some may do that kind of volume but I think that would be rare.
and it really depends on location in the country.. some areas.. were there are still tons of vacant homes wholesaling can be easier but in areas of very strong markets with no vacant homes to speak of pretty tough to do any volume unless you have aforementioned 10 to 30k a month to spend on multiple marketing approachs. nothing different than being a small real estate company which is what you are.. sans the license.
- 7yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Yup your in one of those markets when you have 50,000 vacant homes even a blind squirrel can find deals LOL..
simply cant do that in many other markets were you have NO vacant homes.. its highly regional
- Investor · Baltimore, MD · Member since 2008 · 17k+ posts · 13k+ votes7y
@Tyron White I think you will find a wide variation of the volume wholesalers do. However don't be impressed by numbers. Some believe it is better to do fewer really high quality high profit deals than churn out a ton of low profit deals.
There are a few that do that many deals but I bet most "Wholesalers" never do a deal. The ones that do that high volume have big marketing machines. That is a lot of overhead and they HAVE to do a lot of deals.
- Rental Property Investor · San Diego, CA · Member since 2011 · 1k+ posts · 1k+ votes7y
Tip, many of those who frequent this forum and offer advice are not wholesalers, have never wholesaled and likely never will. Take that into consideration when reading their responses. A wholesaler needs to please two people, the seller and the buyer. How the internet views them is irrelevant.
Know your market expertly, create marketing channels and know who pays the most for deals and how to work with them.
*Closed over $4.5M in wholesales in 2018*
- New to Real Estate · Columbia, SC · Member since 2016 · 96 posts · 21 votes7y@Tim Gordon Yeah I agree and I'm sure you've made a lot of mistakes in the beginning that most of these people are complaining about
- 7yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Originally posted by @Tim G.:
Tip, many of those who frequent this forum and offer advice are not wholesalers, have never wholesaled and likely never will. Take that into consideration when reading their responses. A wholesaler needs to please two people, the seller and the buyer. How the internet views them is irrelevant.
Know your market expertly, create marketing channels and know who pays the most for deals and how to work with them.
*Closed over $4.5M in wholesales in 2018*
In Ca that could be 2 to 4 deals :) in Baltimore that would be 200 plus from what I see on the huds that fund in that city.
- San Antonio · Member since 2018 · 25 posts · 6 votes7y
I'm new with wholesaling, and I became concerned because there is so much information on how to do this, and it seemed like there was so many wanting to do it that my competition was going to be tremendous. I realised my fears are unfounded because this will not going to be easy. It will take work, and didication to get past the obstacles and disappointments that I will face to be successful. Many will decide the price is too high, and move on to something else. When you look only at the clouds you will not see the sun.
- New to Real Estate · Columbia, SC · Member since 2016 · 96 posts · 21 votes7y@Jay Hinrichs Yeah but see here's the thing with me if I see one person doing 50 million every year wholesaling such as ( Carlos Reyes & Sal Shakir ) are doing than I know that I can do it. It's just a matter of being committed and consistent at perfecting the craft
- 7yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Originally posted by @Tyron White:
@Jay Hinrichs Yeah but see here's the thing with me if I see one person doing 50 million every year wholesaling such as ( Carlos Reyes & Sal Shakir ) are doing than I know that I can do it. It's just a matter of being committed and consistent at perfecting the craftwhats the name of their company and what markets are they working in ??
- Investor · Baltimore, MD · Member since 2008 · 17k+ posts · 13k+ votes7y
@Tyron White 50 Million a year? That sounds like BS to me. Even if someone was able to do that it is certainly not a model I would want to emulate.
- Specialist · Dallas, TX · Member since 2014 · 900 posts · 392 votes7y
Originally posted by @Jay Hinrichs:
there are for sure wholesaling companies doing that volume.. but these are for real companies with offices large marketing budgets 10 to 30k a month type.. a couple of full time agents working for them.. etc etc.
someone doing this on their own .. with no support some may do that kind of volume but I think that would be rare.
and it really depends on location in the country.. some areas.. were there are still tons of vacant homes wholesaling can be easier but in areas of very strong markets with no vacant homes to speak of pretty tough to do any volume unless you have aforementioned 10 to 30k a month to spend on multiple marketing approachs. nothing different than being a small real estate company which is what you are.. sans the license.
Pfffffttttttttt! Here in DFW I gave up on counting over 80 wholesalers of all sizes & shapes, and there are several spending up to $75k a month! $30k is chump change! Well, not really, though compared to trying to compete with them in ultra hot DFW, i waived the white flag and went back to what we do best, buying distressed notes & working them out.
And I love the comment above that its actually the most challenging and hardest part of RE, vs being a flipper or buy/hold. The overhead wholesaling is steep and if you don't have reserves, you will run out of $ quickly trying to get noticed. One of our first mail campaigns resulted in a wholesale deal, and she had a HUGE stack of cards, letters, and offers from everyone under the sun...
- New to Real Estate · Columbia, SC · Member since 2016 · 96 posts · 21 votes7y@Jay Hinrichs I'm not sure what they're company name is but I do know they're in the Arizona market and they're the same people who own Need2skip
- New to Real Estate · Columbia, SC · Member since 2016 · 96 posts · 21 votes7y@Ned Carey Why don't you think it's possible ? Homevestors did about $80 million last year so it's definitely possible and they're wholesalers too. I'm not sure what's your experience with wholesaling but yeah there are people doing crazy numbers wholesaling
- New to Real Estate · Columbia, SC · Member since 2016 · 96 posts · 21 votes7y@Christopher Winkler In your opinion why would it be a good decision to wholesale ? Who is that typical person that should wholesale ? Because me personally I don't have the credit or the money to go get an investment property that's cash flowing. So out of all the niches this one just seems right for me because of my situation. Unless it's something I don't know
- Specialist · Dallas, TX · Member since 2014 · 900 posts · 392 votes7y
Originally posted by @Tyron White:
@Christopher Winkler In your opinion why would it be a good decision to wholesale ? Who is that typical person that should wholesale ? Because me personally I don't have the credit or the money to go get an investment property that's cash flowing. So out of all the niches this one just seems right for me because of my situation. Unless it's something I don't knowI am no wholesaleing expert, though like the previous poster said, you have to have a lot of skills, marketer, mailing, bandit sign, door knock, meetups, REIA, and educate yourself, ARV for that area, repair costs. Marketing takes money. You have to negoitate with delusional homeowners sometimes, and buyers that don't want to pay more than MAO, maximum allowable offer, 70% of ARV less repairs.
Its possible anywhere, i just could not run a note business AND try to wholesale. It needs 100% attention and you should either partner with another person like you, or with a more experienced flipper/buy & holder who can guide and coach you, and co-invest with yourself. Some great books here on BP on wholesaling, and buying properties with no money down, you just have to be creative. Just saying you can't just send out a couple rounds of post cards and expect to be rich. Like anything, its a marathon, not a sprint. Best of luck to you and Merry Christmas!
- New to Real Estate · Columbia, SC · Member since 2016 · 96 posts · 21 votes7y@Christopher Winkler Yes of course I do think you have to be committed in order to be successful at it I agree. Merry Christmas to you as well
- Real Estate Professional · Dublin, OH · Member since 2013 · 251 posts · 165 votes7y
I’m a HomeVestors franchise (“We Buy Ugly Houses” guys) and do that many in a month. We’re not just wholesalers though, I hold a lot and rehab where is makes sense. Our top office bought over 200 houses last year, so anything is possible, just have to have the right systems and staff support in place.
- 7yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Originally posted by @Tyron White:
@Christopher Winkler In your opinion why would it be a good decision to wholesale ? Who is that typical person that should wholesale ? Because me personally I don't have the credit or the money to go get an investment property that's cash flowing. So out of all the niches this one just seems right for me because of my situation. Unless it's something I don't knowthe reality of this is: your in a business to bring two parties together on a real estate transaction for compensation. which is basically the definition of a real estate agent .. where a license is required.
So when folks want to get into real estate sales as a licensed agent. its well known that you need at least a year of living expenses in the bank.. you just don't start and in 5 days your cashing a check.. and as a licensed agent you have many other ways to make money as opposed to wholesaling which you only have one.. finding distressed real estate that an investor will buy.. this is very tough.
ERGO the huge marketing budgets those that are successful have.. however for whatever reason many think the complete opposite .. IE I have little money and no credit so the only way I can get into this game is by wholesaling. and no doubt you could do a deal here or there. but to equate to the large wholesalers ( which by the way are all licensed brokers ) they are like any other well capitalized company .. you need a lot of capital to get to be a top producer either an agent or a wholesaler. its all sales at the end of the day.
so I think its very big disservice to many folks to promulgate this myth that no money is needed and your going to be a rock star.. and then the guys that get you to put 20k on your credit card because they are going to teach you the secrets. there are no secrets.. you have to make contact with a motivated seller and you have to have staying power and marketing money.. and really what your talking about is being an assigner not a wholesaler a true wholesaler closes on the deals then resells.. if you have no money to buy then your an assignor or a real estate agent making a fee. Real estate sales is a very tough gig I have been doing it all my adult life.. burn out is at laeat 50% and I would think those that try to assign or wholesale burn out is 90% or more.. I think of all those that post about this on BP and they get all fired up and then 3 months later you never hear from them again. So no one is saying you cant do it.
But the reality is if your capital constrained and no real experience.. it freaking hard..
- 7yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Originally posted by @Jeffrey Hotz:
I’m a HomeVestors franchise (“We Buy Ugly Houses” guys) and do that many in a month. We’re not just wholesalers though, I hold a lot and rehab where is makes sense. Our top office bought over 200 houses last year, so anything is possible, just have to have the right systems and staff support in place.
do you have this success with NO money ??? what type of marketing budgets do you think your franchise's need. I think I recall its 30 to 50k just to buy your franchise right ??? or something like that.. and for most it would probably be smarter than going on their own since you have national recognition and your systems are in place.. better than spending 25k on some guru weekend sseminar that's for sure.
- 7yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Originally posted by @Jeffrey Hotz:
I’m a HomeVestors franchise (“We Buy Ugly Houses” guys) and do that many in a month. We’re not just wholesalers though, I hold a lot and rehab where is makes sense. Our top office bought over 200 houses last year, so anything is possible, just have to have the right systems and staff support in place.
also I got a add now that I am in Vegas from a company called I think OFFER PAD or something like that they have to be spending huge money on ad words etc.. I bet there is some big money behind that company.. and I think they actually close the deals .. and it says on their website that each market they are licensed brokers. So much of this stuff violates licensure laws.. but the big players they all have licenses. at least in the deals I fund around the country..
- 7yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Originally posted by @Jeffrey Hotz:
I’m a HomeVestors franchise (“We Buy Ugly Houses” guys) and do that many in a month. We’re not just wholesalers though, I hold a lot and rehab where is makes sense. Our top office bought over 200 houses last year, so anything is possible, just have to have the right systems and staff support in place.
OK popped on your website full franchise 65k up front part time 27k.. usually in the franchise disclosure docs it will give details of how much you actually need to make these work.. so I suspect your goal is to find folks with about 100k liquid for the 27k one
and probably 200k for the 65k one.. just a guess but I think those are realistic and maybe low.
But like I said I would sure consider one of your franchises WAY before I spent 35k with someone like Sperber.. one of my bird dogs did his deal last spring and he has not got anything he learned there to work in practice..
Just like the fix and flip gurus there simply is only so many people that are going to succeed with their own business.. regardless of what that business is..
- Developer · Philadelphia, PA · Member since 2013 · 1k+ posts · 902 votes7y
Originally posted by @Tyron White:
@Christopher Winkler Yes of course I do think you have to be committed in order to be successful at it I agree. Merry Christmas to you as wellIt's not impossible. One of the wholesalers I work with is maybe 24 and has only been doing this a short while. He's got great people skills and supposedly just the software he uses is $10k/month, not sure what he spends on marketing. We've bought a few things from him and the most we've paid him in fees on one deal was $75k on a $1.5m purchase, which we're happy to pay as the parcel is worth it. All this to say, age and experience don't matter nearly as much as your skillset and desire and if you have the desire, you can build the skillset.
The flip side is, to do this well, besides having the skillset and desire, you're likely going to need some cash. Mailers aren't cheap, lists aren't cheap, and software isn't cheap. You can do a few deals a year the old school way and door knock and such but if you want to consistently close deals, you'll need to spend money. I did work with another wholesaler for a while that did really well for us and probably spent nothing on mailers or marketing. He was local to our little farm area and knew everyone from the old days and networked his butt off to find sellers. He was also a paralegal and was very good at clearing up titles and getting deals over the finish line, which in Philadelphia is huge. The amount of issues we have with deed fraud, probate, dead owners and family not being aware their relative owned a property is incredible. The skills to navigate these issues are extremely valuable but I'd reckon he spent money on legal costs to get a lot of these titles cleared up.
Join the conversationCreate a free account to reply, vote on answers and follow this thread.