Is reverse wholesaling a better way to flip properties?

Flipping houses has become incredibly popular thanks to reality TV shows, celebrity home flippers, and a rising housing market. Many investors have found property wholesaling a great way to take advantage of this with less risk, and more volume potential. Now some are pursuing a niche in reverse wholesaling. So how does that work? Could it be a smarter way to profit from the current market?

Reverse Wholesaling has been gaining attention thanks to real estate educators like Kent Clothier at REWW. The concept is simple. Instead of contracting to buy properties or acquiring them, and then going looking for end buyers, reverse wholesaling flips the process around. It means finding the end buyers, then filling their orders with wholesale properties. It’s essentially preselling and taking pre-orders.

Does it make sense? Of course. Instead of investing all the time, effort, and money into inventory which you aren’t sure will sell, or how long it will take to sell, it means the confidence, speed, and enhanced profitability of knowing your deals are already sold before you get them. This decreases risk, and makes sure you are operating at maximum efficiency.

To make this strategy work investors need to target buyers first. The more qualified buyers you have waiting for multiple deals the more you can get out there and do. Of course you will ultimately need the deals, but there are plenty out there if you know where to look. The latest data shows a substantial double digit surge in REOs this year, and there are almost 1.4M vacant homes which could be ripe for flipping.

As a reverse wholesaler your volume and income potential may only be capped by your access to capital. That’s what transactional funding lenders are for. Best Transaction Funding specializes in this type of lending, and can provide up to 100% financing with no appraisal requirements.

 

Authored by Best Transaction Funding BestTransactionFunding.com is the leading source of transactional funding for real estate wholesalers in the US, where 100% financing, and saying “Yes” is what we love doing all day long.

Does it make any difference who you flip properties to?

Some real estate sellers really don’t have a choice who they sell to. If they list a property with an agent, on the MLS, or at an auction, they really can’t pick and choose. If a buyer comes in with a full price offer their agent is at least due commission for that. But house flippers and wholesalers do have some control.

You can choose who you promote your property deals to. And you should.

Note that you cannot, and should not discriminate in any way, shape, or form. That also means you should be able to back up your choices of buyers. Government and regulators are increasingly stepping in, and at least in one area now control how landlords choose tenants. But it is very important to choose.

Why? We aren’t just talking about selecting the best qualified buyer who is most likely to close on time. That’s a given. However, as the market changes investors will find their future in the business is largely dictated by their buyer choices.

It matters for your reputation. It matters for staying out of legal trouble. In turn this will make a big difference in how many referrals you get, how many repeat deals you do, and the volume you can do. If you are tied to a rehabber who does a shady job and just covers up the mold instead of remedying it, or who does dangerous and illegal electrical work, that can come back to haunt you. Not just legally, but having to live with the fact that you had a hand in harming someone else and their family.

While we all want to maximize profit that also means looking at the long term picture. Are your end buyers pulling a ‘Valeant’ and are pumping up prices so high they are unsustainable, and that they will derail the area due to lack of affordability? Or are they helping people get into good homes and investments while making a fair, but very attractive paycheck?

So how do you get the right buyers? One conversation will usually tell you a lot about a person and their motivations. Google is a pretty handy and fast to use tool as well. Though you can also streamline this process and filter your funnel by sourcing buyers from the right places. Instead of blasting out to the whole world, what if you sought buyers from on and offline groups that shared your same values. Who follows the same people on LinkedIn or Instagram as you do? Who attends the same types of local meetups?

This isn’t an easy decision, and it may not appear to put the most money in your pocket this month. But in two years from now it could make all the differences in whether you are still in the real estate business, and how much of your gains you get to keep.

 

Authored by Best Transaction Funding BestTransactionFunding.com is the leading source of transactional funding for real estate wholesalers in the US, where 100% financing, and saying “Yes” is what we love doing all day long.

Are you taking too long to flip properties?

How long should it take to flip houses? And what are the costly perils of taking too long to turn real estate deals around?

BloombergBusiness recently announced that it’s only taking a few years to flip NYC condos for big profits. Most wouldn’t consider that ‘flipping’. That’s more like buy and hold. In fact; you could probably build a few grand spec homes from scratch with that type of timeline.

In the past RealtyTrac has said the average turn time for flipping houses was 106 days. Redfin says that new home listings shot up 12% in February 2015. However, it also describes buyers “coming in like a lion.” A 44% year over year surge in home showings and a 36% year over year increase in signed offers suggests a looming inventory shortage. And the National Association of Realtors says the average Days on Market (DOM) fell to 89 days in March. That’s ahead of peak spring and summer buying season. So this number should fall even further.

Traditional real estate rehabbing is valuable and needed. And it can still be profitable in certain scenarios. But it may not be the fastest way to turn around deals. And clearly once a rehab is done there is no reason it should be taking real estate investors more than 90 days to flip these houses.

Check out these new hard money loans for fixing and flipping real estate

Meanwhile property wholesalers using Best Transaction Funding are flipping properties in just 1-3 days. They are able to do this because of the capital they are able to leverage, their strategy, and perhaps most of all because they focus on building buyer lists and pre-selling their deals. Let’s be honest; every day holding a property, and every contract signed brings some form of risk. If you don’t already have a concrete exit before going in, you are just speculating, versus investing.

With wholesaling you are almost out before you are in. That presents the lowest possible level of risk. Fixing and flipping is still great, but the more flips you do per year the higher your overall profits are. Do you want to flip your money 12 times a year, or less than once? There should be no reason to be flipping the same money less than four times a year.

 

Authored by Best Transaction Funding BestTransactionFunding.com is the leading source of transactional funding and hard money loans for real estate wholesalers in the US, where 100% financing, and saying “Yes” is what we love doing all day long.

Valentine’s Day will be on us before you know it. So how can real estate wholesalers get ahead of the game, and make this one the most profitable moments of 2015?

Will You Feel the Love?

Valentine’s Day can be a huge sales event for savvy real estate marketers. After all, there are few gifts that can rival real estate. And it’s cheaper than ever to give. This is the perfect occasion to wow significant others with romantic beach cottages, mountain getaways, and sleek and sexy condos. Then there are a huge variety of individuals that can be given investment properties for providing ongoing passive income and wealth.

Armed with the best transactional funding wholesalers can seize on the moment and flip properties fast for a huge boost that will carry them through 2015 and beyond. It’s just a matter of teeing up some great Valentine’s Day marketing…

Valentine’s Day Real Estate Marketing Your Prospects will Love

Valentine’s Day gifts and cards are one of the first outreach methods that come to mind, and they should be given. You never know when yours will be the only one received, and that will buy your real estate business a lot of love. Or who knows which recipient forget to get their other flowers or chocolates and could really use saving.

Online real estate marketing is perhaps the most affordable and fastest choice to launch for many wholesalers. However, forget the cheesy email cards, and think of some sweet slogans and taglines for internet ads, and social campaigns, as well as unleashing highly targeted, themed Valentine’s Day and real estate related content via blogs.

This is also one of the best days of the year for the true workaholic wholesaler. Combine your personal Valentine’s Day with a little networking and business relationship building. Great options might be taking over the Ritz for afternoon tea, evening cocktail parties at one of the properties you are looking to flip, or a yacht charter for singles which just happens to sail by some of your inventory.

How will you get and share the love this Valentine’s Day?

Authored by Best Transaction Funding BestTransactionFunding.com is the leading source of transactional funding and hard money loans for real estate wholesalers in the US, where 100% financing, and saying “Yes” is what we love doing all day long

Spring Break is on and for some real estate investors that doesn’t just mean hoards of bikinis and ice cold beer but big money too.

Well for investors in Panama City Beach, FL it may be all of these things today. The city hosted the world’s largest bikini parade today, setting a new Guinness World Record, with 450 bikini clad women taking to the sand. So where’s the money in this for real estate investors?

Spring Break brings thousands to the coastline around the country every year and its no longer just about college kids who are just scraping by to pitch in for a keg. 2008 saw MTV filming in swanky Sunny Isles Beach, FL. Along with the sun bound crowd are many potential home buyers looking for deals on a vacation home near the beach as well as other investors.

This makes Spring Break a great time to flip seasonal rental properties and luxury homes and condos which can be promoted as fractional ownership deals. However, this gets even sweeter for savvy investors who know how to innovate.

Despite local governments complaining about being broke they are still spending millions every year to promote events like the one in Panama City Beach, FL today. Creative investors know this means millions and millions of often poorly spent dollars up for grabs. Can you get involved in promoting your destination for Spring Break or other annual events and get the city to pay you or at least draw more attention to your real estate investment business and properties?

Even if you aren’t ready to think that big cities all over the country are desperate for investors to help clean up, rehab eye sore homes and get them occupied. Tax credits, marketing money or assistance, more bargain priced properties, it’s all on the table right now. Get your slice...