What is wholesaling? Well, to start, wholesaling is buying a house and selling it to another real estate investor as is. That means, no flipping, no rehabbing, no renovating, nothing. The wholesale is buying it from the seller, then turning around and selling it directly to a real estate investor. And that’s it.
Wholesaling properties is one of the ways to make a great living in the world of real estate investing. However, that living is entirely dependant on your buyers list. A buyers list should be comprised of active buyers in your area, and it should be a big list.
Why Buyers Lists are Important:
A buyers list is a compilation of real estate investors who are actively looking for property to buy. This list does not consist of potential leads, rather, this list contains people who are willing to buy real estate immediately. Essentially, these are people who want to buy what you’re selling, which is the business of real estate investing.
While finding buyers can be the tricky part of real estate investing, having a wholesale buyers list helps to focus your effort on active buyers who you know are interested in your properties. With a strong buyers list, you have an audience of people who are actively interested in the services you offer.
But what good is a wholesale buyers list if it isn’t current, or even fleshed out? You may have a small buyers list, or an outdated buyers list. Both of which will do you little to no good when it comes to wholesaling.
Problems With a Small Buyers List
Alright, let’s say you have a wholesale buyers list, but it’s small. A small buyers list will limit the types of real estate deals you will be able to do based on what your buyers are looking for. Think of it this way, you’ll catch more fish with a larger net than you will with a smaller one. If your buyers list is your net, you want to expand it out as far as possible.
Let’s say you’re just starting out in real estate investing. In the early stages, a limited amount of buyers on a small wholesale buyers list isn’t a bad thing. In fact, that’s probably what helped you get established.
But keeping a small buyers list isn’t sustainable for a long term real estate investing business. The important thing to remember is that a bigger buyer list will help you cast a larger net of people who are actively interesting in real estate investment. The larger the list, the more people you have to sell to in the future.
What If They Don’t Close?
I know it’s tempting to keep it simple and just call up people you know and trust to buy your deals. Starting out selling to friends and family comes with the security of knowing the buyer, and feeling confident that they will close on your deal. The usual issue with expanding is that you don’t know these other investors and are nervous about if they will be able to actually close. This concern is easily eliminated by requiring a non-refundable earnest money deposit of $2,000 or more. If they are serious buyers, they won’t have a problem paying that to you to lock down the deal.
See, the problem with selling to a limited number of active buyers on your wholesale buyers list will keep you dependant on their criteria for buying, instead of what you have to sell. This limits your wholesale business because you will likely be getting motivated seller leads and deals from all over town, for houses of all shapes and sizes and in all conditions. Most investor buyers are focused on specific parts of town, or specific criteria for their investment.
Even if there is someone on your list that wants your deal, there are likely other investors in town that also want that deal and are willing to pay you more for it. You want those people on your list! Remember the fishing net? With a larger buyers list, you can cover every conceivable deal you come across, and be able to sell that deal for as much as you can. All of this can be achieved with a strong buyers list.
Ways To Grow Your Buyers List
Similarly to advertising yourself, your wholesale buyers list will need to be fleshed out with active buyers in your area. If they don’t know about you, then how can you be expected to sell to them? Easy ways to get yourself out there are:
Doing research on Craigslist will help to find active buyers in your area. By simply going to the “Housing” section of your local Craigslist, and searching the ads for “we buy houses”, “sell home fast”, or anything similar to that, you will be able to identify who is already an active buyer in your market. From there, adding to your wholesale buyers list is as simple as contacting them.
Additionally, posting ads on Craigslist is another great way to get your site and contact information out there. Post ads mentioning that you get something like “50% of market value”, then share this information with other investors you find on Craigslist. By adding your contact information, this will help to establish you as an active investor among other active investors.
2. Local REIAs & Real Estate Events
Visiting local REIAs, or Real Estate Investors Associations, will help build your local network with people who are actively investing in real estate. Simply going to a real estate investors association meeting and passing out your card will expand your wholesale buyers list with an active audience. Besides, being personable is one of the key factors in networking. People will be more interested in doing business with you if they have met you and shook your hand. Visiting local REIAs isn’t where all of the real estate action happens, though. Going to foreclosure auctions is another great avenue to pass out your business card at. Foreclosure auctions often have lots of active real estate investors present, so why not optimize that opportunity?
3. Search Engines
Being SEO (Search Engine Optimization) friendly is a quick way for active buyers to find you. If your website has easily searchable content on it, you will rank higher on search engine results on websites such as Google and Bing. It’s pretty easy to rank wholesale sites in local areas with keywords. For instance, making your content searchable with keyword phrases like “investment properties in [your city]” or “cheap houses for sale in [your city]” will make being found online easy for active investors in your area. Being easy to find is especially important because, after a while, the active buyers will come to you looking for real estate investment opportunities.
4. Social Media
Similarly to SEO, professional social media accounts will help you to promote your services, as well as giving active buyers another platform to communicate with you on. Additionally, by searching “real estate investors” on your FaceBook and finding locally listed investors will give you a good place to start. By befriending them, and their friends or followers who are also local real estate investors, you will be growing a social network of active buyers and sellers and adding to your wholesale buyers list. In time, this will get them coming to you instead of visa versa.
5. Use a Lead Generation Tool
When looking for a good lead generation tool, you’ll want something that takes the busy work out of your life. A good lead generation tool is an automated means of growing your wholesaling buyers list that incorporates all of the elements we’ve already talked about. With a good lead generator, you can stay on top of communicating with your active buyers, you will have a platform for quality SEO content, and you will have a user-friendly way for active buyers to add themselves to your wholesale buyers list. You can find a good example of this at this wholesale deals site for investment properties in San Antonio, TX.
One of the key reasons a website is so integral for building a wholesaling buyers list is because the internet is the number one way customers find services. In a study done on internet use from PewResearchCenter, they found that in 2015 alone 84% of American adults use the internet. And the best way to be found online is with a good website that features quality SEO content.
LeadPropeller is a good example of a lead generation tool. LeadPropeller handles 100% of your site’s SEO content that is specifically modified for your local area. You don’t have to worry about creating content, or even coding your website, LeadPropeller does all of that for you. All you need to do is customize your site with your information and pictures, then LeadPropeller takes care of the heavy lifting.
LeadPropeller collects names and emails 24/7, making contacting your active buyers more organized for you. Additionally, LeadPropeller will send automated forms to different groups of people who have signed up with you. For instance, your wholesale buyers list will get automatic email of properties you have for them to buy. This way, you don’t have to stress about staying in contact with your active buyers, let LeadPropeller do the hard work for you so you can focus on wholesaling!
For more information on SEO and web presence, read our blog on “Why Am I Not Getting Real Estate Leads From My Website” for tips on building the web presence on your site.