There is great news for real estate wholesalers who are looking for more inventory. Zillow’s collapse also means that it is shedding thousands of properties for less than they paid for them.

Zillow’s Flawed Products Finally Catches Up With It

There are certainly many real estate investors who are cheering the recent announcement that Zillow is imploding. They have plagued the market for years with a horribly broken data tool.

It turns out that same tool has now finally been their own downfall. After going all in on house flipping, they have announced that their inability to calculate house prices has effectively put them out of business. Effectively wiping out $30B in market value for stock investors, and leading to layoffs of at least 25% of their team.

Without house buying, a Zestimate and data business, and having continued to lose hundreds of millions a year, despite billions in sales leaves little of a company left, if anything.

Zillow’s Implosion Vs. House Flipping

Where Zillow failed many others are thriving and are experiencing their best years in real estate ever.

Obviously, understanding your property values, to make smart offers and re-market them well is absolutely pivotal to success. Something Zillow has finally admitted it simply cannot understand.

Aside from understanding property values, you also have to have a business model that works, and to add more value than others. Yet, Zillow Offers neither offered a great process for sellers, or offered competitive rates. In fact, they tried charging sellers far more in commissions than full priced Realtors.

Fortunately, now regular wholesalers not only get to enjoy less competition in the marketplace, but also the opportunity to scoop up thousands of properties the failed internet company needs to sell at a discount.

Lots More Inventory Coming Down The Pipe

Zillow will probably prove to be just the first in this domino chain. Other large iBuyers and their backers will probably take note of this, and feel better about admitting defeat or will be scared off as well.

That could mean tens of thousands if not far more in discounted deals coming. While investors with capital are going to be looking for new ways to buy into this space.

Now is the time to develop relationships and position yourself to get these deals.

When you sign them, we’re here to fund your deals for you...

 

What types of properties are ripe for real estate wholesaling now?

Whether you are just looking to scale and diversify what you are doing now, or you are just now looking to begin wholesaling real estate to diversify from other strategies and income sources, these five property types are worth exploring.

1. Homeowners with Equity

More and more homeowners are becoming ‘distressed’ as they feel more uncertainty about the market. Most now have more equity than they’ve had in years. No one wants to lose that. They don’t want to see all of those tens and hundreds of thousands of dollars evaporated by a declining market. Yet, there are others who still want to buy and are not worried by any temporary fluctuations in home values. Get in the middle here. Help equity rich homeowners cash out their equity and secure those gains, and connect the property to another buyer.

2. Underperforming Multifamily Apartments

Multifamily apartments have become more and more in demand. More buy and hold investors have stepped up to enjoy the economies of scale these properties provide. Yet, there are many small and medium sized apartment buildings which remain underperforming. They may be ready for renovations, have been managed poorly, or just having aging owners who don’t want to deal with it any more. Add value as the connector.

3. Retail Property with Higher Vacancy Rates

We’ve seen a huge correction in the retail property sector over the past couple of years. There has been a big restructuring. That has left many retail units empty. Yet, there are other retailers who are ambitious on growth. They need more floor space, more locations, and they have the capital to expand. Some will even be potential buyers of their own real estate. Bailout landlords with these vacancies and put them in the hands of better managers.

4. Land

From raw acreage to infill lots, there are plenty of opportunities to flip land deals. With land and new construction still being the more profitable route to profits in many areas, expect there to be more demand in this sector over the next few years.

5. Builder Close-Out Deals

Builders in prime areas like Manhattan are noticeably struggling with over supply. They’ve hit the peak of the market, and would love to cash out and finalize some of their condo projects and new home communities. With the right marketing to the right audience, these deals can still be very attractive to buyers. Especially international investors and buyers. Builders may be willing to negotiate a range of incentives from upgrades to discounts, and deeper discounts for bulk purchases that help them exit a project.

Whatever you’re wholesaling, Best Transaction Funding is here to help you fund your deals...