Real estate wholesaling is quickly becoming one of the most popular ways to start investing. Compared to fix and flipping and cash investing strategies, it’s a low-risk way to make money. But getting started can be confusing and challenging.
So we sat down to answer the top 3 wholesaling real estate questions we hear.
Question 1: What should a real estate wholesaler master first?
There are a lot of skills to master as a wholesaler, including negotiating with motivated sellers, networking with cash buyers, cold calling, and buying property. But none of those matter if you don’t know how to comp deals.
Why? Because if you can’t consistently get sellers to sign real estate contracts at the right price, it doesn’t matter how good you are at cold calling or finding a buyer. You’re not going to make very much money.
So here are some tips to help you master comping.
Understand your potential buyers
Comping is about more than just comparing sale prices. If you don’t understand who you’re selling to, you’ll have a hard time making the right offer.
Fix and flip buyers, long-term investors, and other types of cash buyers have different strategies and buy at different price points. If you don’t know who you’re selling to, you don’t know what price to advertise your deal at, and you’ll probably leave money on the table.
Find an investing mentor
Secondly, we recommend individuals who are new to wholesaling find a mentor or work with a group of experienced wholesalers. They’ll know the ins and outs of investing, and while you won’t keep 100% of your profits, you’ll make way more under their guidance than you will alone.
You don’t always need an in-person mentor, though. YouTube and social media are full of experienced investors who share their knowledge for free. Jamil Damji’s BatchTV show Straight Outta Compin’, where he helps viewers comp their deals live, is one example. Other excellent wholesalers to watch include Brent Daniels, Ryan Zolin, and David Dodge.
Use a trusted comping tool
Finally, we recommend using a comping tool. As wholesalers and real estate investors, we cofounded BatchService to make investing simpler. When we started, everyone had to comp their deals manually, and they needed a real estate license to access reliable information. Not only was the process tedious, but if you made a mistake or missed key information, it could spell disaster.
That’s why BatchLeads’ comping tool includes MLS data and a built-in value calculator so you don’t have to do the math yourself or worry about making mistakes.
The best part is that you have complete control over what area the platform searches for comps. You can search for comparable properties by zip code and include or exclude certain areas from your search by drawing a custom search area on the in-platform map.
Question 2: What attributes does a wholesaler need to be successful?
Consistency is essential for wholesalers. So many people start wholesaling because they think it’s an easy way to become a millionaire. When they realize wholesaling requires consistency and hard work, many of them give up.
So to be successful, you have to spend time looking for deals regularly. Whether you’re pulling lists, driving for dollars, or networking, you have to make prospecting part of your daily routine. The same principle applies to marketing, calling, and following up with motivated sellers. If you only call once every few days or every few weeks, you’re not going to see the results you want.
Wholesaling requires self-reliance
Consistency is the most essential trait a wholesaler can have, but self-reliance is equally important. Successful wholesalers believe they can succeed. When they fail, they learn quickly, apply the lessons they learned, adapt, and move forward. They also know that the best wholesalers and real estate investors in the world have failed countless times. So to succeed they swallow their pride and work hard until they achieve their goals. Successful wholesalers don’t give up.
Question 3: How do you find contracts in an oversaturated market?
Unfortunately, every real estate market in the US is oversaturated. They’re all full of competition, but that’s a good thing. Competition breeds opportunity.
A few years ago wholesalers had less competition, but they had even fewer options for selling to cash buyers. They were often limited to fix and flip buyers who thought that a $10,000 assignment fee was too high. Now, many wholesalers are making six figures on a single deal!
So what can you do to succeed in today’s wholesaling market?
Make your mindset work for you
Having an abundance mindset is one of the most important choices you can make. Today’s wholesaling opportunities are endless! And while wholesaling may be hard, the profits are massive. That’s something to get excited about.
Take that excitement and ask yourself, “What do I have to do to get a contract? What creative ideas can I come up with?”
Every day that you send out direct mail, drive for dollars, cold call or knock on doors, remember that your hard work is going to pay off sooner than you think. And when it does, you’re going to be glad you put in the work.
So keep a positive mindset and stay excited. The right mindset will take you further than anything else.
Care about motivated sellers
You shouldn’t just focus on the money, though. That’s the quickest way to fail in real estate wholesaling.
Motivated sellers often have personal and financial needs. They’re not selling their homes at reduced prices because they want to! So start by looking for ways to help them. If you see people as dollar signs, it will be pretty obvious.
The truth is that if you care and worry about how you get paid, you’re not going to be successful. As a wholesaler, your job is to help people who are in a stressful situation and don’t want to sell on the MLS.
So look for ways to help them. There are more opportunities than you think, and this mindset is at the core of most successful businesses. That’s why if you’re consistently failing to close deals, it’s probably because you aren’t helping people solve their problems. Once you start looking at wholesaling from this perspective, everything else will fall into place.
Wholesaling is hard, especially for new investors. But because it’s hard, it’s full of opportunities that other people miss.
There are life-changing rewards available for wholesalers who are willing to find them. If you take the time to master comping, work consistently, and develop a winning, problem-solving mindset, you can build a successful wholesaling business. Of course, these insights are just a sample of the information the BatchService team has already shared. Check out our YouTube channel BatchTV to discover webinars with industry leaders, platform walkthroughs, and so much more!