Need advice about picking up wholesale properties

[David P.]

I am looking at buying wholesale properties and at an recent REI meeting a wholesale asked me several questions like where would you like the property, how much profit to I need. So I am looking to purchase properties in two different geographical areas of the united states (mostly because I already have an infrastructure setup) and want to stay in these markets. What are standard questions that wholesales ask potential buyers and what are typical answers to profit. Please remember that I come from the retail side; and I don't want to pay any more than I have to; but also need to make my numbers work on the cash flow side because I am buy and hold buyer.

Thanks in advance for your help,

[Nick Miller]

@David P. ~ For the past 11 years I have been a buy and hold investor however I have always bought with three rules to minimize risk and maximize income and liquidity.

1. I only buy homes when I believe I will have equity at closing (I can resale them on day 2 and make money)

2. I only buy homes that will make good rentals (If I am wrong or if the margin is not enough to justify #1)

3. I only buy homes that I would be willing to live in OR I only buy homes/buildings I believe I can have a sold flip where I can at lease double my investment.

I have followed these criteria for cash deals and have a slightly different model for contracts...

In my market I will typically only look at buildings where I am getting the property for 25% of the last sale price AND the building is being sold for 50% of area comps.

I don't look at many properties and make offers on 99% of the buildings I physically look at and generally win 20% of the deals I go after...

If you dont have good criteria you will waste a lot of time, energy and money chasing "deals" and if you rely on an estimated ARV to estimate in profits you will lost your shirt if the market goes South again.