Posted by Joe on September 22, 2004 at 22:28:35:
Nick, what’s true for your city isn’t true everywhere. Real estate markets are local, and different.
In my large city he would have had no problem wholesaling this deal. Rehabbers are paying extraordinary amounts because of competition, and this one isn’t even borderline. But maybe you are right, and I’m wrong. Maybe his market won’t bare this wholesale deal. We just don’t know.
Why couldn’t I wholesale this house? - Posted by Brandon_IN
Posted by Brandon_IN on September 21, 2004 at 14:07:00:
About 6 weeks ago, I put a house under contract to buy with the intention of wholesaling. I bought it for $4500, intending on wholesaling it for about $7000. ARV is around $40,000, and about $15,000 in work. I know that it is not a huge spread for a rehab job, but I thought a landlord may have been interested in it, for some sweat equity.
I ran my “Handyman special” ad for a couple of weeks, and got probably around 10-15 calls altogether (mostly people looking to live in it). I told them all to go out and check it out, and call me back if they’re interested. Not one person called me back. After a couple of weeks I stopped running the ad, and lost a lot of motivation
What did I do wrong? I’m now going to close on the house myself in a few days, because I couldn’t find a buyer. I will try to fix it and resell it, just to get it off my hands. My motivation for the wholesaling side of the business is quickly fading, even though it sounds like an excellent way to do business. Is it possible that they’re just aren’t that many rehabbers in my town? I know this stuff is supposed to work in every town, but what else could it be?
Brandon_IN
Re: Why couldn’t I wholesale this house? - Posted by Nick
Posted by Nick on September 22, 2004 at 19:23:03:
How about this for a reason you couldn’t sell. Everyone else seems to have looked over this.
You only have $18,000 left on the table for the rehabbers profit. Also out of that $18,000 you have to figure holding costs… Closing cost… Realtor commision… Also if your repair estimates or comps were off that eats up even more profit.
It’s hard to find any rehabber who would put $22,000 to make that little amount of money.
Just remember… Not every “Deal” is really a deal.
Nick
call ads - Posted by ken in sc
Posted by ken in sc on September 22, 2004 at 07:01:56:
Call all the I Buy Houses ads. They are or know all the investors in town.
Ken
Re: You can and you will… - Posted by Kathryn
Posted by Kathryn on September 21, 2004 at 20:57:32:
Brandon, I went through the same just recently and I ended up completely updating my buyers list with “real investors” that want to deal. I had relied so much my regulars investors, I had neglected to continue to market my services. I always keep a list of everyone who calls my ads and bandit signs and when I placed a newspaper ad again, I put it in the real estate wanted and financial services section. The phone rang off the hook with investors and what they want for a spread. Do this, and you will have the house under contract within the week. Just retrace your steps, call back those people if you can, and I would place the ad again in a different section. Wholesaling is fun and very profitable. I wouldn’t have it any other way.
Re: Why couldn’t I wholesale this house? - Posted by Joe
Posted by Joe on September 21, 2004 at 14:43:26:
Brandon, this can happen when you are just starting out. You don’t have a list of rehabbers to deal with, because you haven’t met any yet. Or, at least, you haven’t made a list out of the callers wo are investors and called them back. Once you have a list of people to call, you can usually skip the ad and give them all a call.
If you know for sure that a caller or two were investors, definitely call them back now. Talk to them about what you want to do, and ask if they would like to see the interior. Meet all of them there and talk to them about their business and what they are looking for, how much they want to make in profit on each deal, etc.
Once you get your foot in the door, by knowing the movers and shakers, you’ll do a great business.
Re: Why couldn’t I wholesale this house? - Posted by ken
Posted by ken on September 21, 2004 at 14:33:33:
You need to be more aggressive. Call them back try to make appointments. The first call should be to make an appointment after that try to commit them to something at the house. The only time i tell someone to drive by first is if after talking to them i do not want to deal with them. Make 1 appointment and then try to line everyone up for the same time