Investing in distressed real estate has long been my passion. Where else can you make a difference for a homeowner, the community, and, at the same time, strive for your investment goals?
So, I was surprised when my friend Jerry said he was going back to corporate America after just a few months of real estate investing under his belt. Jerry, from my assessment, was doing well. Apparently, I was wrong. He didn’t want to go back to his old career, but he was beginning to feel dejected. Jerry had hoped by now he would have made a big enough name for himself that sellers would seek him out.
We got to talking about Jerry’s attempts to find motivated sellers to wholesale real estate and why they weren’t working. I told him about the strategies I’ve found effective. There’s a lot of ways to find wholesale properties, but some are more effective than others.
How to Find Motivated Sellers to Wholesale Real Estate
When it comes to wholesaling real estate investing, your ability to reach your goals is only as good as the leads you get. And, to wholesale, you need a lot of leads. It’s a numbers game. Since you don’t make much off of any one deal, you need to make a lot of deals.
Here are some of the ways that Jerry tried—and failed—to get leads on motivated sellers so he could wholesale real estate.
Purchasing distressed properties at an auction has long been a popular way to find distressed real estate. Closings tend to be fast with auctions, which means a faster turnaround on your investment—an important element for wholesaling. And, there’s little in the way of competition from owner-occupiers since bank loans and other traditional financing methods aren’t easy to come by for auction properties.
All of this sounds great, but there’s a lot of reasons this hasn’t been an effective strategy for Jerry. For starters, competition in his investment area abounds. Jerry said he would show up to some auctions and there would be several people representing banks bidding on the same property. You also have to be mindful of liens against the home that could make it pricier. These things usually resulted in the price reaching a point that didn’t make it worthwhile if you were wholesaling real estate.
Real estate agents and others in the industry gather information on homeowners that may want to sell their home on the cheap. These lists, which you can purchase, have information on deaths, divorces and other financial hardships that could put a property in play. But, often, the information is outdated and incorrect. Even when it’s right, so many real estate investors purchase these lead lists, you are often not the first to reach out to the homeowner. While lead lists give you an in, you’ll spend so much time sorting through the lists and digging up information on properties that you won’t get the volume of solid leads necessary to sustain a wholesale business.
Canvassing the Neighborhood
When it comes to finding motivated sellers, sometimes their properties tell the story. It could be an overgrown lawn, broken windows, or other signs of disrepair. Jerry tried canvassing neighborhoods to find those signs. It can be an effective way to find properties in need of an upgrade—but that doesn’t mean everyone is looking to sell.
Once you find a property you have to approach those potentially distressed homeowners. If they are in denial or embarrassed about their “ugly” financial situation, it’s possible that you’ll get the door slammed in your face. And, calling doesn’t make them any friendlier about your offer to buy. You can’t wholesale if you can’t even get your foot in the door.
I spent a lot of time listening to Jerry vent about finding motivated sellers to wholesale real estate. He felt like he’d tried just about everything. Lucky for him, though, I had some advice that he hadn’t tried yet.
Finding Motivated Sellers To Wholesale Real Estate Doesn’t Have to Be Hard
That’s when I told Jerry about how happy I’ve been as a HomeVestors® franchisee. The days of disappointment and frustration about only finding dead-end leads are now long gone. I now benefit from the nationally-known and trusted “We Buy Ugly Houses®” marketing campaign to get some of the best distressed qualified homeowner leads. These homeowners know who to call when they need to sell because the multimedia campaign has been running on television, radio, billboards, online and in print since 1999. It’s so effective that, together, we’ve purchased over 100,000 houses.
If you’re like Jerry and are looking for an easier way to find motivated sellers to wholesale real estate, it’s time to contact HomeVestors today.
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