I was at dinner with a friend who was looking to get into real estate wholesaling here in Florida. He wanted to know what the single most important aspect of it was, and guessed that it was speed. So, I asked him to demonstrate some speed and started to reach for the check. He grabbed it first. I told him that was pretty fast, but now he was stuck holding the bill.
That’s the thing about wholesaling houses—especially here in the Sunshine State. You have to be fast and be smart. You have to have the ability to move quickly, but also make the right move. It takes a plan.
If you know what to do, and have a wholesaling business plan, you can step forward with confidence. Let me help you begin.
What it Takes to Whole Real Estate in Florida
Here in Florida, with the real estate turnover and a near-constant flood of people moving in and around the state, real estate wholesaling can be a pretty good career. All across the state, there are both home sellers and fix-and-flippers looking for homes. By working as the go-between, you can have a stream of houses bought and sold.
A lot of new investors start by buying foreclosures. In 2019, Florida had the 5th-highest foreclosure rate in the country. But, you can find much better deals by connecting with homeowners looking to sell their homes before they get foreclosed upon.
That’s where you can come in. If you can find a pre-foreclosure home, you can make an offer, and then sell it to someone looking to fix-and-flip it. If you were to lay out a step-by-step wholesaling plan, it might look something like this:
- Have potential buyers lined up
- Find the right distressed property
- Make a smart offer to the seller
- Make a good offer to potential buyers
Sounds easy? It’s not. There’s a lot you need to do to make this work for you. All of these steps have to work in concert. You have to be thinking about all of them at every stage.
Here’s a more realistic plan.
1. Get good leads.
It’s tempting to think “I just have to find an underpriced house that I can sell at a decent profit.” But, it’s not that easy. Even though you aren’t doing the fix-and-flip, you have to think like a fix-and-flipper.
What do renovators look for in buying a house? Well, they look to see how much work and money they are going to have to put into it. They look at the neighborhood and if they’ll be able to sell at a profit and how long it might take. All those considerations factor into what they will be willing to pay you.
2. Develop a network of buyers.
You absolutely need a way to find wholesale buyers even before you buy the house. There are real estate investing groups and other networks that you would benefit from. It’s not enough to buy the house and then put it up on Craigslist or something. You don’t want to sit on a property waiting for buyers.
3. Know the investment potential of each lead.
Is the property you buy going to be a property someone else wants to buy? This means calculating a few points:
⇨ What the current owner is willing to sell at. They are often looking to sell fast, and want a fair offer to move on with their lives. You’re helping them in a tough spot, and want to make a fair offer.
⇨ What your buyer is willing to pay, and the potential costs of renovating.
⇨ What their potential buyer is going to pay.
The fix-and-flipper has to be able to sell the house at “your price + their work + more” to see some ROI. So, you have to keep everyone’s needs at the forefront.
4. Make a good pitch.
Obviously, you can’t know how much work anyone is going to put in. You don’t know if any given fix-and-flipper is going to put in a master bathroom and a pool or thrown on a coat of paint and call it a day. But, you need to estimate.
And, that’s where your pitch comes in. When you pitch the house to your network, you need to make sure you are offering at a price that doesn’t send anyone running to the hills. If you pitch a house in an area that has an average selling price of, say, $150,000, and you are offering to sell an underpriced home for $140,000, you aren’t going to get anywhere.
This is all hard work that relies on both science and intuition. But, there are ways to make it easier.
A Better Way To Wholesale Real Estate in Florida
I know this sounds complex, and it can be. But, it doesn’t have to be one. I’ve been doing it for a long time, and know a lot of people who move wholesale houses by the dozens each year. I also know a lot of people who didn’t make it. For myself, I only really first felt confident wholesaling when I became an independently owned and operated HomeVestors® franchisee.
Being a HomeVestors® franchisee provides a lot of benefits— including comprehensive training and ongoing mentoring— but there are two huge ones. The first is access to qualified leads. Distressed homeowners here in Florida have been seeing the “We Buy Ugly Houses®” ads for years. It’s a trusted national brand. So, before a foreclosure happens, they know who to call.
But, just as important, I have a nationwide network of franchisees—some of the best in the business. These are other investors who know what they’re doing and are always eager to make a smart move. So, if I have a good deal on my hands, it’s not hard to sell it to someone else eager for another opportunity to get to work.
Wholesaling real estate in Florida is work. But, it’s good work that rewards confidence, smart investing, and yes, speed. If you have these qualities and want to turn wholesaling into a career, request information about becoming a franchisee today.
Each franchise office is independently owned and operated.