The market has changed. Where are the end buyers for your house flips and wholesale deals now?

The real estate investors who come out of 2020 on top are those who are the most flexible and quick to adjust to the changing times.

You may need to be more careful about the deals you buy, to ensure there is an end market demand for it, with able buyers. Know the buyers, and you’ll know your exit strategy before you get in, and the types of deals to be taking on now.

Wealthy Home Buyers & Buy And Hold Investors

Just a couple of weeks into the COVID-19 mess and Chase bank slashed availability of mortgages. Now requiring at least 20% down and a 700 plus credit score. That is going to eliminate a large portion of the population as potential buyers.

In contrast, many wealthy individuals and families are pulling their money out of the stock market, retirement plans and the banks to put their money into real estate. Some are buying half a dozen units or more to protect their wealth.

They have all cash, or can put down 50% and still get a mortgage relatively easily.

Movers Escaping The City

We are being told that even if quarantine restrictions are temporarily eased that we face another coronavirus outbreak in the winter, and it could be worse. Some are warning this could be a multi-year pandemic.

Who wants to be stuck in a condo in the city, with fast rising crime during times like these?

Expect more buyers cashing out their urban homes and moving to smaller towns and rural areas. Especially now that the office has gone the way of the dinosaur and remote work is here to stay.

Those in this group who act quickly can still walk away from their properties with cash to buy something else.

Real Estate Syndicators & Funds

Real estate syndicators and fund managers are also having to pivot and diversify in order to deploy capital and deliver on promises to their own capital investors.

You can serve them wholesale deals. Even better if you can pull together portfolios to provide the bulk buys they need to make efficient transactions.

Property Owners With High Amounts Of Equity

With the exception of transactional funding for real estate wholesalers, it is getting much harder to find loans to purchase real estate out there.

One exception to this may be homeowners and rental property investors who can refinance or offer high equity properties as collateral and gain bridge loans to make new acquisitions.

COVID-19 Heirs

Even before this virus we were in the middle of one of the biggest wealth transfer periods of our history. It’s a tragic situation. Yet, many of those who have passed on in this crisis may be glad to see their heirs now able to use their inheritance to go buy homes in safer areas, or use their legacy to go invest and create new streams of income and businesses in real estate which will keep providing for future generations of the family.

 

Spring is officially here! Try out these strategies to boost your real estate wholesaling business now…

Hop to it While the Market is Good

We’re still in tax refund season, there is still likely more negative data to come out after the end of the quarter showing the new trajectory of the housing market. Get more inventory and flip it before more buyers are scared out of the market.

You can use Best Transaction Funding to scale and move fast without being limited by funds. Set a goal of making at least 5 offers a day. If you are already operating at that level, up your numbers by 5.

Spring Clean it

Try spring cleaning and prehabbing your deals to create a blank slate. It’ll be a lot easier for buyers to visualize the potential and can add a lot of perceived value to properties without costing you much.

Invite Them Over for Easter Brunch and an Egg Hunt

Build your brand and relationships in your community and target neighborhoods. Host an Easter egg hunt or brunch, and get to know people on personal basis so they come back and refer you when needing to sell.

If you are really doing well then maybe you can afford to give away the keys to a wholesale home in one of your golden eggs.

Get Out Those Easter Gift Baskets

Send out Easter baskets to potential referral sources and cash buyers. Hand deliver or ship them. It doesn’t have to be costly, but be more creative than just an Easter card. Stay top of mind, and look to open direct lines of communication via phone or text versus just Facebook or email.

Like these strategies? Look out for tips on making most of Mother's Day for real estate wholesalers...

 

Ready to make 2019 your biggest year in real estate wholesaling so far? It’s all about finding the right end buyers for your deals.

Properties are still plentiful, and the rumors are that there is a lot more inventory coming onto the market. As the cycle continues to turn that is likely to mean many more motivated sellers too. With 100% financing for wholesale deals from Best Transaction Funding, there are really no limits to the amount of volume you can do. So, who is able to do the most deals in 2019, and who can be in and out and paid the fastest is really all about lining up the right end buyers.

So, who are the end buyers in the real estate market in 2019?

Individual Cash Buyers

Overall there may be fewer cash buyers in the housing market in 2019. After years of purchasing homes and investment properties for cash, many have locked up their liquidity in equity. However, do expect more new mom and pop investors with retirement funds and who are cashing out of the stock market who can afford to pay for more affordable properties in all cash. Then there are many who will be inheriting their parents wealth and homes to cash out as well.

Investment Funds

Investment funds are still hungry for real estate deals. They have a lot of capital and must deploy it. One of their biggest challenges right now is putting that money to work. If you can provide bulk deals, then they may snap them up for cash as well.

House Flippers with Specialized Financing

One of the biggest challenges wholesalers perceive about flipping properties to those that need financing is getting through any inspection and condition hoops demanded by mortgage lenders. However, those flippers using one of today’s more modern flip lenders or private lending companies normally won’t have those issues, and have been enjoying high LTV financing. Advertising properties for only cash buyers will mean missing out on this bigger and highly active group of end buyers.

Boomers & Generation X Home Buyers

On the retail resale side boomers and Generation X home buyers could be among the most active in 2019. They have the credit to get loans and many have the down payments. Many have been waiting on the sidelines for a decade for house prices to soften up and are now eagerly looking for deals. Millennials are forecast to be the group which takes out the most mortgage loans in 2019, yet half don’t even have $1 for a down payment and closing costs. Only 10% have much saved. So, it may not be wise to bank your own income on serving millennials alone.

In conclusion - there are many great opportunities in 2019. It’s all about lining up the end buyers, and promoting to them in a way that connects. Who will you be wholesaling too?

 

Who can you be flipping your wholesale homes to now?

If you want to wholesale more properties, wholesale faster, and make more profit, it helps to know who the most active buyers are in the market. There is more than one type of buyer for wholesale houses. Bulk up your list with them.

Rehabbers

Rehabbers and fix and flip investors are still one of the top buyers of wholesale homes. They need this inventory to fuel their businesses and incomes. Having a consistent source of wholesale deals allows them to stay focused on what they do best (fixing). This is becoming even more important as house flippers look for new areas to work in, with more opportunities.

Rental Property Investors

Rental property investors also need to keep their pipelines full of new acquisitions. They are needing to dig deeper and deeper to find house deals where numbers work. Some may want to make renovations and improvements, others won’t.

Other Wholesalers

While it’s important not to get tied up in long chains, other wholesalers with bigger buyer lists, and who can handle more volume may be some of your best contacts. These may be other pure wholesalers, investors looking to owner finance and create new mortgage loan notes from these properties, and even funds.

Retail Home Buyers

Regular home buyers are increasingly looking for wholesale house deals too. Too many other properties are being overpriced, and inexperienced and unrealistic agents and sellers are overpricing and have little in the way of negotiation skills. Today’s buyers want to feel as if they are getting a good deal. Some may take more work than other wholesalers, but they may pay more too.

Non-Profits

Nonprofits and not for profits are also looking for affordable housing supply to supply their users with, or to house workers and those they help. They may even buy your deal in bulk.

Home Builders

Small builders are often finding it more profitable to acquire existing properties and fully renovating them instead of building from the ground up. It can be greener too. Even larger builders often need to piece together larger parcels to put new communities and projects on. It’s much easier for them to work with wholesalers than regular homeowners.

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