Is virtual wholesaling even realistic?

Question

I recently listened to a couple podcast episodes about how a successful wholesaler was tying up great deals in his local market. He eventually decided to venture out to a market 4 states away. He was able to utilize the internet to find vacant properties and distressed property owners with no ease, however, when it came to convincing a seller to sign a contract with him (a total stranger that the seller has never met in person) he found great struggle. Maybe I am short sighted, but if I was a seller, why would I ever want to make one of the largest transactions of my life with a stranger, whom I have never seen or met in person before and only got in contact with from a piece of direct mail? I have heard of wholesalers being successful this way, but not often.

Given that it's not likely that successful negotiation can be made solely over the phone, have you heard of many cases where this business model is profitable or even worth the time and energy?

Given that it's not likely that successful negotiation can be made solely over the phone, have you heard of many cases where this business model is profitable or even worth the time and energy?

Christopher Petrillo · Answer

@Julian Pilate-Hutcherson I currently work from New York and I wholesale in Indianapolis.  It is very profitable if you have feet on the ground in the market you are looking to wholesale in.  I found in the Midwest, people are more friendly (even on the phone) and getting people under contract isn't difficult if you just know how to talk to people.  If you have any questions about starting a team or anything else don't hesitate to ask.

Jerryll Noorden · Answer

VW definitely is realistic, yet I am not much of a fan.. although we will start doing it soon.

See, what you need to do is this. Generate a bunch of leads there, and have boots on the ground. I personally think there is a better way. I would open "offices" there, and expand MY company, instead of "partnering".

And this is why I inherently think going outside of your market could be a bad thing. Let me explain.

We just got a contract signed for 11K. ARV 173K and cost of repairs around 50-60K.

She is literally giving the house away. When I say literally.. I mean literally. She still owes about 20K on it. So she has to pay off the mortgage.

Obviously we wanted to make sure this is what she wanted to do. She said yes. So we just had the inspection and while the inspector was doing his thing we got to talk with the seller. So I asked her... Why give the house away? An other investor could probably give her more. (we had our reason for asking 11K)

She answered:

Because you do good work! (She was talking about the robotics I am involved in).

So then I asked her,  (because she was trying to sell it to us for  since july, but we get SO many leads about 50% get lost in emails we never even open... she was adamant to sell it to just us)...

So I asked her How did you find us? This is something we ask all callers and leads so we can tweak our site.

She said "Are you KIDDING??"

You are all over the place.

Now you may ask, why telling you this story.

Here is why. When you become the go to company for sellers to sell their house you get SO MANY leads!!

See everyone thinks SEO is all you need. No! Seo gets you an audition with the world. SEO gets you on stage. Now YOU have to perform. You need to show you are the poop!!

So that is the goal here. If the goal is more leads (and if that is why you want to wholesale virtually) I would start becoming master of your domain first.

I do not care where you live, there are deals EVERYWHERE. Too much competition? Do you think I have competition? No I do not. It is a choice.

It is a "no brainer" to choose us here in CT. That is what you should try to achieve.

People think that they get more deals when they expand. But be careful there. You get WAY more deals if you get ALL the deals in your own local market... and the local leads convert easier.

So you need to compare spreading yourself thin in many markets, vs. be everywhere in your local market hot and heavy.

So is expanding then a bad thing? No, it is not, as long as you do it he right way. That is why when we are ready to take over the USA (sorry'all enjoy your freedom while it lasts muuhahaha) we are going to build offices everywhere and then like a malicious virus spread and take over!

Justin Ellis · Answer

Hey Julian,

I just started wholesaling (Like, JUST this week). After weeks of reading books, researching on BP, etc I downloaded The Deal Machine App (Which is AWESOME BTW) and hit the streets. I say that to say, I can't speak to whether long distance wholesaling would work but if they're using direct mail, it wouldn't be any different than doing it locally EXCEPT for the face to face interaction of course.

If I were to try and do this, I would partner with a closer who could go handle the homeowner interaction stuff and getting the homes under contract and I would generate the leads and handle the interaction with the investors. I think a partnership is the only way this could be successful.

Lydia R. · Answer

@Julian Pilate-Hutcherson It works if you have boots on the ground in other cities who can help you do all the things that you can’t do from several states away. Once you have a good handle on your market its a great way to expand your business with out having to physically in another place.

Goziem Ononye · Answer

These answers are really helpful, I had similar questions.

Is virtual wholesaling even realistic?

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