3 Pitfalls That Can Crush Your Real Estate Wholesale Dreams
Date : October 25, 2019 By
Real estate shows are quite popular right now…
The premise is simple – find a low priced house that needs a “little rehab”, make a lower bid, renovate the house, make money; it’s so simple. And while those little “cherries” do exist, they are few and far between. In most cases, you get into a house a little below market value, rehab it, raise the price to account for the differences, and walk away with $5,000 to $10,000 in profit for several months of work.
Now, what about all those distressed sellers? You left them out…
Well, that’s a little different. You see, distressed sellers are probably living in their home, but know they can’t afford it anymore. The houses are generally in “living shape” and easily flipped. Obviously, this is a win-win situation.
Real estate wholesale is the process of connecting a buyer and a seller together and netting the difference between the buyer and the seller (in essence, you are the realtor). You handle all the paperwork between the two clients. If the seller needs to sell the property for $100k and you can get the buyer to pay $120k, you can net $20k!
So what are the pitfalls?
Why hasn’t this been SCREAMED from the rooftops?
Below, we are going to discuss, briefly, three pitfalls that can crush your real estate wholesale dreams.
1. Spending Money You Don’t Have
It’s easy to get excited when you have your “first sale”. Everything looks great, the buyers are happy, the sellers are happy – all that’s left is paperwork.
To celebrate your sale, you go out on the town with your wife (or friends). You run up a huge tab for the night. You stay at a fancy hotel and eat the finest buffet they have. You spend a little cash at the tables. You enjoy yourself…
Then a few days later, you get crushing news – the buyer isn’t interested anymore. When this happens, there’s little you can do to save the sale. WORSE, you’ve spent money that you didn’t have and the bills are coming due.
2. Letting The Buyers And Sellers Talk
Your job is to keep the buyers and sellers apart until the paperwork is being signed. Nothing is worse than finding out that your buyer managed to work out a better deal and cut you out of the process completely … it happens.
Instead, you need to make sure that the sellers never know who the buyers are until the sale is being finalized. It can be easy to let this information slip, but it can be a costly mistake. In fact, if you do slip up, it will be an expensive mistake that you won’t forget.
3. Getting Too Excited About The First Sale And Forgetting The Rest
And the last pitfall is forgetting all the other sales you will get. The first sale is exciting, but you should not stop working.
Too many wholesalers forget what brought them success – marketing. No one is going to come to you and say “sell my house”. You have to work for it. This means putting in a LOT of effort. Marketing on social media, facebook, search engines, newspapers, magazines, signs in yards, etc.
Once you get the BIG one, don’t stop doing what worked. It can be easy to get excited and sit back for a few months. This is the worst decision you can make.
Where To Find Advice / Mentors?
Understanding real estate wholesale is not difficult – the rules are just different. There are hundreds of ways to make money selling real estate. To be the best, you have to know what the others don’t.
Whether you are new to the real estate wholesale scene or a seasoned vet, there’s nothing wrong with getting advice. Property M.O.B. is a great resource where you can find training, courses, and fresh news about real estate wholesale. The information that they give out is worth every penny – actually, thousands! They are active in real estate wholesale and they know the ins-and-outs; the information you don’t.
Memberships are extremely affordable and the content they give out is not readily available to non-members. In fact, you won’t find this information anywhere else.
If you are serious about real estate wholesale or just want to see what’s behind the scenes, you should sign up with Property M.O.B where they make true, Bad Ass Investors!