I was an insurance lawyer for a long time before I started wholesaling, about 25 years. I was more or less content with the salary, so I just stayed where I felt safe and comfortable—until my daughter entered the 8th grade and already the other parents were talking about college applications. Yikes. I realized I was going to need to do something a little bold if my little girl was going to get the education she needed.
I wanted to scale up my bank account and real estate investing caught my attention as the best way to do it. But, I didn’t want to get tangled up in rehabs and managing contractors. Instead, wholesaling houses seemed like a piece of cake. You find a property and find a buyer. Simple.
Except it’s not that straightforward. At first, like many other investors, I got the formula backward. The easiest way to get into trouble with wholesaling is buying properties without a plan to sell them to another buyer. If you can’t find enough buyers for your properties, it won’t be long before your holding costs eat your margins. That’s why you need to start looking into how to find buyers for wholesaling real estate before a deal lands in your lap.
Wholesaling Requires Knowing How to Find a Lot of Real Estate Buyers
Each property you wholesale has a lower margin to begin with as your value-add is essentially a finder’s fee. This lower margin demands a higher volume of deals. So, before you start making wholesale investments, you should have a list of buyers ready. I say a list because if one buyer falls through, you don’t want it to torpedo your margin-—you should have another lined up.
But, with wholesaling, it’s not worth your time trying to market your deals to regular homebuyers. The traditional homebuying process takes too long—that’s if lenders would even fund your buyer. Typically banks avoid funding houses that need a lot of repairs. As a wholesaler, you don’t have time to let this shake out. You need to wholesale your houses in weeks, if not days. Ideally, you sell the property the same day you buy it.
To do that, you need to sell to other real estate investors. Look for investors who are more interested in the renovation side of real estate investment. These buyers will likely keep returning for more properties if you make it easier for them than finding investment opportunities on their own. In its way, it’s a very natural division of labor.
So, how do you find these buyers for your wholesale real estate? Either you meet every investor, or you make friends with an investor who already has this list. Here are some places you potentially can meet investor-buyers:
Your Website and Their Forums
You really need to have your own website, and I don’t mean a Facebook page. Your website is home base. It tells investor-buyers everything they need to know about your business and provides the opportunity to get in touch with you. If you list wholesale properties online, your website can become the first place local investors visit when they’re looking for deals. It also becomes your online calling card—when you post on local real estate forums, or even Craigslist and Zillow, you can include a link. When investor-buyers look on these sites for properties, they’ll find you.
Local Real Estate Investors Clubs
Local real estate investor clubs exist in just about every area in the country. Most of them cater to newer investors who are looking to network and buy properties. As a wholesaler, you have clout here. You’re the person these newer investors want to meet. You should be aware, though, that most clubs have membership fees, ranging from about $150-300 annually. Especially if you don’t plan to attend every week, pick and choose the clubs you join to cut down on your costs. Shoot for the most active groups in your area.
Real Estate Auctions
The thing about competitive bidding is that while the winner gets what they want, nobody else does. So, property auctions are another place to find investors who may be hungry for wholesale real estate. Bring your business cards and shake every hand you can. These investors will go home calling themselves lucky—now that they know a wholesaler, they don’t need to go to auctions anymore.
All of these strategies help, but none of them by themselves can provide you a list of every investor in your area. At least, not without spending fifteen years building the list in pieces. Fortunately, there’s an easier way to wholesale real estate: making friends with the people who have this list already.
Find Buyers for Wholesaling Real Estate the Easy Way
I have done well wholesaling real estate. So well, in fact, that I left my lawyer job—and my daughter’s school debt—behind. You see, I don’t have any trouble finding buyers for my wholesale deals because I am one of over 1100 independently owned and operated HomeVestors® franchisees. This network provides the best wholesaling business plan I’ve come across.
Our network of franchisees makes wholesaling easy. Every member of my regional group pitches in to create a list of wholesale buyers. We are all active real estate investors and have boots on the ground, so this list is pretty comprehensive. With this buyers’ list in hand, my wholesale deals are often sold very quickly. In the off-chance that my deals aren’t picked up by a buyer on the list, I simply put it on the DealVestors®TM website. This website allows you to directly list a property for other investors to buy.
Many investors become a HomeVestors® franchisees for access to qualified leads on houses—I became a HomeVestors franchisee to provide them.
Are you looking for consistent buyers for wholesale real estate? Contact us today to find them!
Each franchise office is independently owned and operated.