When starting out in wholesaling how big do you suggest someones buyers list be at a minimum before they start looking for houses to flip.
I also have another question. Ok I live in Atlanta, Georgia and we have properties down here all the time being offered at 20-25 cents on the dollar in the REO market with the homes being in $80,000 to $100,000 neighborhoods. My question is when you see prices like that should you just automatically snap it up or try to get the lower price and flip back up to near what the bank was asking. Or do you buy at the banks asking price and mark it up a little bit to sell for more than what the bank was asking?
And can you do assignment of contracts to the bank, like REO homes? say the bank is the Seller in this case, would you beable to have them sign a assignment contract with subject to clause in it , then turn around and sell that contract to an investor? is that possible?
The last few I’ve done had specific no assignment clauses in them.I see this trend catching on with the lenders.Checkout my post on this QUestion and you’ll see sugestions to get aroiund it.
Essentially you can start looking for homes when you have 1 buyer on your list. BUT be sure you are just looking at homes that meet that buyers needs. Having said that, I would still spend 80% of your time building your list.
It will be very tempting to get just 1 buyer and then start running around like a chicken with your head cut off looking at real estate…DON’T.
If you find a buyer who is a cash buyer and buying up multiple homes at multiple prices then I would suggest spending far more time looking for homes than if you get 1 buyer who is picky and is only planning to grab 1 home.
When many people think of wholesaling they think of Buying homes at 40-70% of PRESENT market value…The problem is right now the value that your judging against is on a reverse sliding scale.
Example: If 40 homes on your market are priced at 50% of what they originally sold for then you can no longer use the old price as a benchmark for a homes value. The benchmark would now be 50% of the old value…Plus 40-70% of that value.
Do you see what I’m saying? If a home used to be worth 100K and now similar homes are selling for 50k, then 50k still isnt a steal because anyone can buy at that price. In order to wholesale a home like that you would want to buy it for 40-70% of the 50k price.
Okay so Eric I believe you are saying that even if the price is offered cheap, offer half of that price for it to be a deal. If it’s offered at $50K and it’s worth $100K then offer at least $25K for it or less.
What if it’s offered at $25K and it’s worth $100K? Would I still offer half of that price?
I never get caught up in asking price…Doing that will keep you broke.
I worry about 1 PRICE…
What the home is worth RIGHT NOW! To figure this one you need to factor in sales from the past 2 months, Current inventory on the market, and direction of your market.
Once you’ve established what the home is worth Right now, then you seek to snatch it up betwen 40-70% of that price.
The problem is that many Idiot wholesalers run around saying they have homes at 40 cents on the dollar and wonder why it won’t move…Their talking about 40 cent’s of an OLD DOLLAR, which can be 100% of a new dollar the way our economy is heading.
Eric, do you have a website that you use mainly for REO’s? If so, would you please give it to me so I can see what a professional site looks like? I like your course also. Thanks.
Right now I have been using a blog format for my real estate sites because it captures google ranking so much quicker.
I had front page of google in 2 weeks for my keywords.
You can view my real estate site at TheForeclosuresMan.com if you want to see it…If your not high tech you could just start with a blogger account and build a blog off of their.
Just make sure you buy a relevant domain to what you plan to do.