How to Wholesale my Landlords Property

How to Wholesale my Landlords Property

Real Estate Agent · Los Angeles, CA · Member since 2019 · 30 posts · 14 votes

Would love some advice from all you masterminds:

My previous landlord is a sweet older lady who owns a multi-unit building here in LA. I can tell she is having a hard time keeping up with finding new tenants and is not interested in doing any type of renovations to the property. (It’s quite outdated and needs TLC)

It’s clear she is living off the rental income for her retirement but it’s becoming more difficult to keep up.

I’d like to help her sell it and wholesale the property to someone who can rehab it and get more value out of the property. She could live off what she makes from the property sale or reinvest it into something easier to maintain (less tenants). I’ve tried to help her find new tenants but the building needs love.

Most of the wholesale conversations I’ve seen are between a wholesaler and a seller they didn’t know.

I’m looking for some advice about the best way to approach this scenario seeing as how I would need to have her assign the property to myself to execute the contract. Do I approach her as if I want to buy the property myself? Or bluntly explain to her the process of wholesaling.

I would genuinely like to help her while also building my experience in wholesaling and real estate.

Perhaps you would have a completely different approach? Thanks for your advice.

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Investor · NJ · Member since 2018 · 869 posts · 921 votes
7y

Why don't you just ask her if she is interested in selling the property to you. Maybe she'd even owner finance it to you. 

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  • Contractor · Oxford, MA · Member since 2018 · 807 posts · 745 votes
    7y

    @Kimberly Schaid so she's not motivated and referenced properties worth way more than hers in better condition as comps. Good luck to you if you can make that deal work. Your best bet would be to get her to hold 20% of the loan or do full owner financing and pay her back and do upgrades as you collect rent, but it doesn't sound like that will work either. So best case for you is to get the listing and make some money off it, but we come back to that $1.7 number again and if she brought it up already, it's for a reason. She probably thinks she might have to come down to $1.5 at most because the others were a little nicer.

  • Real Estate Agent · Los Angeles, CA · Member since 2019 · 30 posts · 14 votes
    7y

    @Caleb Heimsoth got it! Appreciate your insight!

  • Real Estate Agent · Los Angeles, CA · Member since 2019 · 30 posts · 14 votes
    7y

    @Bryan Devitt those are interesting strategies. I will research more on owner financing and see if it works for both of us.

    Thanks for your insight.

  • Goshen, AR · Member since 2017 · 267 posts · 159 votes
    7y

    @Kimberly S. listen to what @Joel Thompson said... I haven't paid much attention to the numbers but what I do know is this is a prime opportunity to find a money partner and do the grunt work and get the experience. This is a text book situation of bringing the deal to the relationship in order to get into the game. 

    I don't want to validate @Caleb Heimsoth's reasons for not wholesaling but I have to agree in this instance it doesn't work. Wholesaling (not a fan of that term) or assigning contracts takes a lot of experience and a deep network in order to create a winning situation for the seller, assigner, and buyer. We buy rentals and flips for the most part but occasionally when our dance card is full we will assign a contract. In those rare instances we only assign to investors we consider "partners" in the business and close 99% of the time. 

    If it were me in this situation... I'd put together a spec sheet on the property and start looking for an experienced partner/mentor to pitch it to. Depending on the size of the property (residential vs commercial) comps won't matter, and if the rents are WAY below market there's a huge upside value add. Keep asking questions and forging ahead and you'll find a solution that works... Feel free to reach out if you've got questions I can help with! 

  • Real Estate Agent · Los Angeles, CA · Member since 2019 · 30 posts · 14 votes
    7y

    @Dustin Davis thank you very much!!!! I agree there is potential for me to bring this deal to an investor.

    I’d love to get in contact with you with some more questions!

    I appreciate your valuable and constructive insight!

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