This should be its own forever caregory. Great comments and observations.
The wholesale gurus are adamant and nearly rabid in their approach to sell you on their program. And it's touted as the best way to get started. Actually another way with less risk is as a deal finder with an acquistion team.
After having some wholesale "deals" evaporate or chasing just a the first couple that couldn't even meet me at the properties, or didn't know the power of an ooptionc or contract in general I was losing ground quickly.
Daisy chain, wholesale, ARV as medium rehab, ARV as extreme rehab, ARV as a rental buy and hold, real GOOD comparable sold properties.
That still is a dance and education that is done today.
Some areas and times and properties need to be at 60-70% ARV minus repairs. Some at 75 or 80% and depends on ARV price and Investor.
Birddogging for one Big Wholesale Co here in Phoenix area, I came across a property that actually had, something like"will take care of after PROBATE is over" written on the door. And a phone number.
My friend and one of the acquisition team members and the executor all met together.
There were two groups of investors including us. The number the investor offered was 120k. He estimated 40k in repairs. Anyway, they had me keep in contact, and about once a week I'd call the executor to see how he was and he'd give me updates as to what his nieces and nephews (out of town) were considering and how best to dispose of his sister's estate.
This went on for 2 or 3 months. If it all came together my friend and I who knocked on doors and called people and left flyers (or fliers) would get $2500 to split. We were both living in a warehouse at the time and this sounded great.
But, the investment company was trying to retool so a different less aggressive less go getter type was filling in.
So, when the executor finally said he was close to making the decision and that he had an offer at 150k and allowed all interested investors to make their offer.
"We" would not offer more than 120k and the vibe was off. I just was sure there was a deal here. I think this is one of those times where I should have gone it alone- tied up my own option or purchase contract and wholesaled it...but I didn't have the guts.
And no real good close mentor was around to guide me through. It sold for 152k and in weeks later sold at 190k!!!!! I looked it up again recently and saw it sold last year (one year later) at $360k!
When the investor group wouldn't pull the trigger or find a way to compensate for all the flier sticking, knocking and getting their phones to ring...my friend...bolted...never to work with them again. Ugh.
I'd see another one or 2 that I did not go full tilt into like an option that was shortened and expired.
I'd later see that though the wholesalers controlling it couldn't get it done that it sold within 2 or 3 months for 40k over my option.
Last year I had a Joint Venture with a local mentorship school and got mt first successful wholesale deal done! The ARV depended on adding a bedroom and the wholesale fee was 8k! Awesome....ish!
I got 20% of that...$1600.
My next deal was what I call a micro wholesale deal. I Joint Ventured with a Realtor who put up the Earnest Money.
A townhouse-There was one or maybe 2 complete renos in this complex of townhouses...and so the high comp put its ARV at 145k
But...not many investors liked this comp although it was beautiful. The townhouse needed some work, to rent or live in...It was occupied and the dogs that had resided there left their marks. Walking in when it was warm and wheww the scent was strong.
We finally had to just assign it to a couple getting financed and it was a skinny deal, but my friend who owned the place was so glad we could get it done.
I'm not a real estate agent but in the beginning of 2007 I got licensed... It was a real struggle jut to keep my license or renew it...never had enough money set aside for emergencies ugh...
I think it was 2011 when I finally let it go.
I'm still trying to crack this real estate nut wide open.
I work with about one to 3 other acquisition teams. I see many wholesalers sending in 'deals' and when trying to comp sometimes its close and other times the number of floors was different. Ugh Lol...
And the tendency is high ARV low rehab estimates. And bad comparables.
I don't have access to MLS and am considering a subscription to NetValue or maybe paid to redfin... Or something as many agents won't comp for you, and Zillow solds, and Trulia info, and realestateabc can sometimes give you a very inaccurate picture of the market.
Anyway, sometimes a micro deal of less than 2 or 3k to split with your JV partner is the thing...and if it helps that seller because you were able to solve their problem after agents, and other investors could not make the numbers work and seller not having money to put into the deal...
Well, a micro wholesale or low assignment deal may be helpful.
Now the house I have undercontract in escrow in Virginia.... Well, they just found 2 more liens and a foundation problem and the $1000 dollars I borrowed from friends for a % of profit... Is at risk...
Auction Flipper program that is out there is missing some pieces....jus' saying...
(Mash of guru voices in my head... "...But you can make 30,000 in 3 weeks and with fast action bonuses we'll send you a compass and your own embossed business cards made entirely of tin foil!
Just as Leonard Stinkbottom-
Yeeeep, I was livin' in a cardboard box and wore the same pair of pants for an entire year...and now my Networth is 50 million dollars!
If I can do it, you can too!"
("Disclaimer, you may lose a lot of money learning to make a lot of money but we'll make a lot of money and tell you...you can too!")
Anyway, thanks for this slot.
The truth about wholesaling is it takes work and should not be the only method you ever use...that is for sure!
Thanks Bigger Pockets...for this forum and your podcasts and books and recommendations.
