Why real estate wholesalers work with Handsome Homebuyer
The pros and cons of real estate wholesaling
Sell My House Long Island
In the real estate ecosystem, everybody knows about sellers, buyers, brokers, attorneys, appraisers, accountants and real estate investors (or at least they should!), like Handsome Homebuyer. The wholesaler, however, is an important resource for buyers and sellers. And real estate investors, like Handsome Homebuyer, are key partners for wholesalers. If you’re a wholesaler, you may already be doing business or referring business to real estate investors. If you’re not doing business with investors, you should look at that as an option. And if you’re thinking of wholesaling, real estate investors could be a key part of your business for wholesale properties in long island.
What is wholesaling?
Wholesaling is when an individual finds and markets large numbers of properties by cold calling, sending mailers or advertising. They get an interested party with a distressed house or property they’re looking to sell. They don’t usually do the renovation work. They get the house or property under contract, including a clause to assign it to someone else. They’re real estate marketers with real estate investment and construction experience. They put the house under contract, ask a would-be buyer if they want to buy it. The buyer, such as Handsome Homebuyer, another real estate investor or buyer instead closes in their place. The idea is to get the biggest reward with the least risk, if you do it right.
The pros of wholesaling
Wholesaling is an excellent, low-risk way of making money in real estate, if you know what you’re doing. It’s not as simple as buying low and selling higher. You have to find someone who wants to sell and someone who wants to buy. Wholesalers don’t have to manage construction, raise money or put up their own capital, which all helps limit risk. They could lose their down payment if they back out. Like any other business, they build a list of qualified buyers. They have favorite buyers. Handsome Homebuyer is a favorite buyer for many wholesalers. They come to us first and foremost. They know it’s an easy, simple transaction.
What risks wholesalers face
Everything brings some risk, as well as potential reward, and wholesaling is no different. If wholesalers go into contract, they try to have a small down payment from $1,000 to $5,000. That’s their risk. They also need to find buyers. They typically have a pool of buyers. If they don’t, they go to social media as well as potential buyers. Overpaying, however, can be the biggest problem. If they don’t know what they’re doing, they can end up paying more than they can get. Then assigning the contract later can be a big problem.
What it takes to be a good wholesaler
To be a good wholesaler, you have to know a house will be worth “X” when it’s renovated and know the costs regarding buying, financing, holding and making money on the deal. Then you have to back out the fees. And you have to find a seller and a buyer. Real estate investors can make life easier for wholesalers by buying numerous properties. The most we’ve bought from a wholesaler at one time or on one day was seven properties, but we would buy 20. Investors can do deals faster than most others, since we fund the transaction. Handsome Homebuyer can do a deal in a matter of a few days.
Why wholesalers turn to investors
Real estate investors can be ideal buyers, but you still need to get and vet investors, to make sure they have the funds and will follow through. Some investors aren’t organized, well-structured and funded. They don’t have the money to close. Sometimes, they back out of the deal. Handsome Homebuyer has done hundreds of deals. Wholesalers can call us on a Tuesday and tell us we have to buy the house on Wednesday. And we’ll be there. We buy a lot of properties from wholesalers. Since we buy 70 to 110 houses a year, we’re able to do multiple deals with individual wholesalers. We probably buy half of my inventory a year from wholesalers. That’s their profession. And we purchase a lot of property from them.
A match made in volume
Handsome Homebuyer, as well as many investors, uses our own money. Most matches are made at the bank: We self-fund. We always have the ability to close and we can handle volume. We also can buy a wide variety of properties, although we specialize geographically in Long Island and the boroughs of New York City. We buy land, rental properties, apartment buildings and more. Most investors only buy one type of property. We buy all of it. People come to us, because they know whatever they have, we’ll buy. It’ll be easy. And we can take as much of it as possible.
How real estate investors benefit wholesalers
Handsome Homebuyer can help wholesalers make deals and make money. If they have a house under contract at $300,000 and we’re willing to pay $310,000 they assign the contract to us. They don’t have to put up the money to close. They give the closing to us. The wholesaler puts the house under contract under X and we go into contract at Y. The wholesaler gets the difference.
Investors as wholesalers
Real estate investors can also be wholesalers, if they find more than they can buy. A lot of investors don’t have Handsome Homebuyer’s capacity. They may only be able to do two deals at a time. If they get a deal on a third, they’ll wholesale it to Handsome Homebuyer, because they don’t have the capacity to do the deal at the moment. Wholesalers can email or call us. We deal with anybody who has a deal. I don’t’ care if you do one deal a year or 300. If you have a deal for us, we’re happy to talk and work with you.
How Handsome Homebuyer helps launch wholesalers?
Wholesaling is an excellent way to earn money in real estate with minimal downside risk, but, once again, you need to know what you’re doing. I think it’s very important to say that Handsome Homebuyer has helped launch many wholesalers’ careers. New wholesalers call me. I talk to them for five, 10, 15 or 20 minutes and give them things they should know, including feedback about the market. I wouldn’t take any of their deals away from them: if they mention an address, I look at it as their deal. I’ve had a person come to me privately after a wholesaler discussed a deal involving their property. I still paid the wholesaler. It’s the right thing to do. And the wholesaler usually comes back to me and brings me all their deals. So if you’re a wholesaler, dealing with many properties, it probably makes sense to look into working with real estate investors and we buy houses Long Island. Handsome Homebuyer may be the missing link in the matches many wholesalers are trying to make.
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