Vampire real estate agents are bleeding real estate investors dry and their thirst can’t be quenched. So is it time you tweaked your wholesaling strategy?
Increasing competition among U.S. real estate agents and a shortage of listings for them have Realtors combing the streets like the walking dead, looking to prey on investors.
In fact one Florida real estate agent recently proudly told the press “I ask for blood” when quizzed about the demands Realtors are putting on today’s home buyers. They virtually are too.
So how can real estate investors combat Realtors filled with this bloodlust for commissions, and protect their incomes?
A Growing Pandemic
While there are great, trustworthy, hardworking Realtors out there many of today’s agents don’t care about anything but banking the most money while the market is hot and they don’t care how they do it or what the consequences are.
It is a twofold problem that is even worse for those wholesaling MLS properties. Many agents today wouldn’t think twice about trying to scoop a listing by convincing a seller to back out of a deal with an investor so that they can list it. While on the other side of the coin these agents are making it incredibly difficult for some to lock down properties.
Realtors are making outrageous demands of home buyers in some busy areas. They don’t want any risk of not getting paid their commission and if they can collect multiple commissions for contracting on the same home again and again they are happy to do it too.
Their demands are meant to bullet proof their paydays as much as ensure a closing. When making offers in the hottest markets today don’t be surprised if asked for large deposits, huge down payments, being forced to use specific lenders or loan programs, being required to waive inspection and appraisal contingencies and more.
Avoid the Infection
So how can real estate investors protect themselves and their income? What wholesaling strategy tweaks might be wise to operate profitably in these times?
First, don’t get infected. Just because others are playing this game that doesn’t mean you should give up and join the hordes of bloodthirsty vamps trolling the industry. Separate yourself by treating people well and creating win-win situations.
Second, consider simply looking elsewhere for deals. If you feed the local zombies they will just keep coming back for more and increase in numbers. Don’t encourage this behavior. There are plenty of undervalued properties out there and entire states still in the mire of foreclosure. Go work those.
If that isn’t an option and you are facing this type of battle to get your purchase offers accepted on a daily basis look for ways to navigate the situation to contract on better terms. Look for alternatives to wholesaling MLS properties. Use private money or transactional lending to close faster and refuse to put too much in escrow upfront.