Wholesaling With Real Estate Agents
This is a continuation of “The Great Escape” audio podcast reality show with Eric Thiele. Eric has been given assignments each week to help him get his wholesaling business started. In this episode, Eric catches us up on the challenges he has faced and the successes he has achieved over the last few months.
Sean: So, now it sounds like your biggest struggle so far has been either a) not having a large enough cash buyer list, or b) potential evaluation on the properties. So, I tend to think Dallas, Houston and Austin; those markets are hot right now. Those are some of the best markets in the entire country because inventory levels are low and there are a ton of investors picking stuff up. And hedge funds picking stuff up, which typically will pay retail. So where would these properties price versus an after repair value?
Sean: Wow. See that will fly off the shelf here in Phoenix.
Eric: Yeah, I mean when I’m trying to wholesale it, that’s about where I have it priced. And I get some interest, some real interest, but I haven’t been able to close anything except for this one that turned out to eventually wind up coming back as an FHA situation rather than a true…
Sean: Right, just a wholesale cash. So how many people would you say are on your cash buyer list that are essentially cash buyers?
Eric: Well, I’ve done direct mail to several hundred, and people on my email list probably about 40.
Sean: That is something we’ve got to really work on, is increasing your cash buyers list with two different sources. Number one is with realtors that are selling agent realtors. Number two is either through pay per click advertising of people looking, or three, spending time down at the auctions. If I was going to fly to your market right now and I was going to start from scratch, the number one source place I would go is I would find out exactly when those auctions take place. Sometimes it’s once a month, sometimes in Phoenix, it’s every single day, sometimes it’s once a week.
Go down there and attend those auctions and just get everybody’s name and number. Those are the guys that will buy your properties for cash quickly. If I was going to go to your market, that would be the first thing I would do is locate that. Those would be my guys. Then kind of reverse engineer it from there, and kind of figure out what they’re looking for, what their perfect criteria property is and start looking at the HUD website and see if there are any properties. Now you’re in Austin, right? So, what are the inventory levels there? Back in December there were 30-40 houses on there. Then it went down to maybe five or six houses, then it went down to two or three houses, but it fluctuates. Like last night I got a bid accepted on a property. It’s probably worth about 220 and I got if for 130. Regular bank owned properties are probably at the 125 and 135. So it’s right in where bank owned properties are selling. But far from fixed up, if that makes sense.
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