How are you are wholesalers doing??Atlanta and in general

[LaRhonda M]

Hey Guys,
Just wondering how you guys are doing with wholesaling in your areas?
Im pretty much a real estate newbie and would like to get started relatively soon.

At one point I wanted to start with wholesaling, but most of the feedback that I’ve seen or heard, isn’t as golden as a lot of people make it out to be. So just wondering how you guys are managing?

At this point, thinking ill start in REI by just waiting to obtain a rental property, and start from there.

[Ryan Webber]

Wholesaling is work, just like any other strategy. And most people don't like work, so most people who wholesale suck at it.

But the same is true for most people who do rentals, notes, rehabs, land contracts, lease options, owner finance, sub 2's, and really any business strategy in any industry I can think of. Success comes from working and most people suck at working, so most people suck at success.

I have to admit that wholesaling is definitely losing its sex appeal. It used to be real sexy 5 years ago, but now its starting to get old and wrinkled looking. It still makes money, though, which is really what matters.

I've wholesaled for 7 years and I just did 2 last week. I also do rehabs, rentals, and notes. All of which are still viable strategies for income for me in my area and when worked at properly, are probably still viable sources of income in at least 95% of the United States.

I got a call from a newbie wholesaler last week who is branching out virtually across Texas because, according to him, his home city is too saturated and you can't make any money in it. He had to get off the phone to talk to his coach before I could tell him that I was regularly doing deals in his home market and I thought it still had a tremendous amount of opportunity.

The man who says you can't do something should get out of the way of the man who is actually doing it.

As for buying a rental to start, the issue to consider is the next step. What is your next step? How are you going to get your next deal?

Generally speaking, growing a portfolio of long term holds requires capital. So unless you are starting with a large pool of cash, you need to focus on a strategy that will make you more money. Lots of money. Large chunks of money. Either your job/business or your real estate business needs to provide this source of capital. A single rental property just isn't going to produce enough, fast enough to grow a portfolio from.

Let's say it takes $10,000 to purchase, finance, and rehab a rental property that you will net cash flow $300 per month on. Well that's a pretty strong return of 36% Return On Investment on your $10,000, but its still going to take you 3 years to save up your cash flow for the next one. Now as you buy the next one and the next one, your profits will compound and you will be able to buy properties faster and faster but your growth rate is pretty slow. It'll take over 5 years to get 4 properties. So the trick to doing it faster is to build a business that generates more capital in the meantime (like wholesales, rehab to retails, etc.). Strategies that you can make chunks of cash to reinvest into your long term holds portfolio.