I have Cash Buyers, but No sellers

[Merari Alfaro]

Hello,

I'm 100% new to everything here. I'm currently doing my research, and taking in as much info as I can on wholesaling. I have a friend who knows plenty of cash buyers, and also is a cash buyer herself.

I have no idea how to start finding sellers, or how to talk to them, or how to negotiate. She said she does flips under 200K, cash, and to try to find properties that have 60-80% ARV . I'm not sure what that means, but at the risk of not coming off as ignorant I didn't ask her to elaborate.

I don't know what she meant, and I don't know how to start or where to start?

[Don Konipol]

@Merari Alfaro. It’s a little hard for newbies to understand, but think of it like this. A particular aApple phone is being sold for 900.00. You line up hundreds of people willing to buy that phone for $550.00. However, you have no phones to sell and no idea how to find a source willing to sell the phones for $525.00. Your buyers list is worthless.

Same thing in wholesaling. Without finding, identifying, controlling a property that meets the criteria of the buyers ( a substantial discount from market value), your buyers list is worthless.

The few people who have tuned wholesaling into a business have educated themselves extensively in both real estate principles in general, and their particular market niche in specifics. Further, they have developed rather sophisticated systems for marketing allowing them to generate leads of potential sellers fitting a particular profile. Many spend significant ($10,000 per month +) money on marketing. Of course there are exceptions, but to just go driving by, or scan MLS, or get a list of homes being foreclosed on, and think you're going to be able to establish a sustainable business is just a dream sold by people selling mentoring services.

Probably 99% of would be wholesalers give up after 6 months. Reasons are lack of knowledge, lack of expertise and experience, under capitalized, too much competition, don’t like the work required, lack of time, frustration, inability to stand large amount of frustration, legal requirements not being met, disappointing results. At the very least consider what you would need to do to be successful: deal with homeowners during the most stressful time of their lives; during financial crisis, unemployment and divorce, and the fact that most will be confrontational and consider you a predator. Ask yourself if this is something you really want to do. There are a lot easier ways to make a living. And by the way you won’t be a real estate investor, you’ll be running a business within the real estate industry. Basically doing the same thing as a real estate broker.