When we first start out as investors, it sounds so magical and easy. Step 1 locate a property or a wholesaler who can bring deals to you. You think ” OK” and so the journey begins. Soon the reality of investing hits you as realize that step 1 is harder than anticipated. Wholesalers can sometimes provide us with a steady supply of inventory; but, the supply does not always meet our expectation. The downside of working with new wholesalers is their lack of experience. Many times, they do not accurately evaluate the deals with the proper tools or have the negotiating skills to acquire the property at a price that will still make the investor a healthy profit. Unfortunately, most deals that they present are not deals!
Many wholesalers lack the tools to accurate estimate After Repair Value (ARV) and tend to rely on free tools like Zillow, which gives an inaccurate Zestimate at best. Wholesalers tend to not have access to the MLS or comparable appraisal tools their projected costs and profits are usually miscalculated.
Since many wholesalers have never done a rehab deal, they lack the experience to accurately estimate repair costs. This lack of knowledge causes them to underestimate repairs and updates needed to produce a quality product for the retail buyer or tenant.
The lack of experience with a process of a rehab means that the wholesaler will not anticipate costs associated with a rehab and therefore they don’t not take those into consideration when negotiating their asking price. The Wholesaler doesn’t account for other cost such as financing costs, closing, taxes, insurance, ETC. Then they tend to have extremely inflated after repair value (ARV) and very low repair cost estimates we are then left with a deal that does not have any spread to make a profit and will most likely be a waste of our time.
At Goldenrod Real Estate we believe in creating a win-win for our company and our client. Our marketing generates a lead takes the client a detailed system and evaluation to find out if the deal will make sense for both of us. We will considers proceeding to a contract only if it makes sense for our numbers and the seller’s situation
Sometimes, we will consider wholesaling a deal if we are already working on multiple projects and feel that we wouldn’t be able to it that project the attention it deserves. In the event this happens, we provide a small group of select investors the opportunity to acquire that project.
We have limited inventory of these deals so many times we will not advertise these opportunities. To make sure we provide our inventor-buyer with a property that will best meet their needs, we have an interview process that insures that we are showcasing properties for your business model and that we aren’t wasting your time! For those we are working with, we don’t provide deals every week, or even every month. But when we do offer you a property, it will exactly match the criteria for your business.
If you’d like to interview for our VIP buyer’s list, please click the link or image below and fill out the form on our buyer site. We will contact you to set up your interview!
http://www.Goldenrodrealestatellc.com/