The wholesale real estate investment market ISN’T the retail real estate investment market…
Posted by admin on Jun 13, 2012 in YouBuyHouses Blog | 0 comments
I got a call yesterday from a guy who was really, really interested in a 4 family that he heard me talk about at REIA…3 weeks ago.
He was VERY disappointed that it was already sold-his comment was, “you didn’t tell me you had other people looking at it!”
This is probably the 10th time this year that either Drew or I has heard this kind of comment from potential buyers (sometimes they’re even mad–some of them apparently think we already have the property sold before we call them, or that we’re “only selling to our friends”, as one once said. Here’s a clue, buddy…if you buy a house from us, you ARE our friend!)
And I know exactly where all this confusion is coming from.
You’re used to seeing properties–especially bank–owned properties and junkers–sit on the market for months and months while the price drops and drops. You’ve gotten accustomed to the idea that it’s never important to run out and see a property RIGHT NOW, because it’ll still be on the market when you “get around to it”. You’ve heard and read that average days on market for real estate in Cincinnati is around 6 months. You just don’t see any reason to put aside what you’re doing and go see that house TODAY.
I’ve got some news for you, people-that’s the RETAIL investor market.
Those properties that sit and sit are always overpriced, and the seller is willing to leave them that way for months (or sometimes years- we recently flipped a property that had been on the market for 1,117 days before the bank finally broke down and sold it to us!), hoping to get some sucker to overpay.
The WHOLESALE investor market-the one that we deal in-moves much, much faster, and here’s why:
1. We’ve already negotiated the rock-bottom, no-brainer price that every other investor in the city has been beating their heads against the wall for months to try to get. How? We’re magic.
2. The property has already been evaluated and the repair costs estimated
3. The title search and termite inspection have already been completed before we ask you for a dime
4. There are a whole lot of buyers out there who’d rather have all this done FOR them, avoiding the whole “make 20 offers to get 1 deal” slog- especially when they’re paying the SAME AMOUNT to us as they would have paid to the seller
5. And this is an important one: we’d never offer you a deal we wouldn’t take ourselves. Thus, if you don’t buy it, we’ll buy it ourselves. Thus, if you don’t act pretty darn fast, it’s gone baby gone.
The last 2 deals we sold were gone in 3 days and 4 days, respectively. And to EXTREMELY experienced investors, by the way- one has done more than 50 rehabs and the other has bought and sold well over 1,000 units.
So here’s the lesson: when you get a call, or an email, or hear about a property of ours at a REIA meeting, and it’s in your farm area, I ABSOLUTELY GUARANTEE you it’s a great deal…so you’d better go look at it ASAP.
The wholesale real estate market waits for no man. This is the best time in our lifetimes to buy properties for cash flow and appreciation, and bread-and-butter properties ARE still selling on the retail market. So snatch some of our pre-evaluated properties up, and don’t complain to me if the one you really wanted is gone before you see it.
-Vena