Long Distance Wholesaling


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  • I put an ad on Craigslist for bird dogs and someone replied with 4 properties in a town that is about 2.5 hours away from me. I don’t know that market much at all but he said they are very motivated to sell.

    Could I wholesale these? I don’t have any buyers in that area, and don’t know it well, but I could pull comps on the properties when I find out what they would be willing to sell them for.

    Any thoughts on how to get creative on these? They are in a college town and may make good rentals?

    I don’t know much else about them right now. Any thoughts on information I should gather besides the obvious stuff?

    Thanks.

    That is pretty far for a wholesale deal so there needs to be a good profit margin to make the trip worth your time. But even with no buyers list, you could do a 2 day highest bidder sale to get it sold for top dollar IF there is equity and it is a good area.

    You need to get the numbers to know if it is worth your time

    There are a lot of motivated sellers with little or no equity. So motivated does not mean there is an opportunity unless there is also equity.

    You need to know what homes in the area have sold for that were in good condition.
    How many sales in the same neighborhood in the last 6 months? how many were cash deals?
    You need to know what percentage of the home sold were foreclosure properties vs retail sales
    You need to know what repairs need to be done and what it would cost.
    Is there a mortgage? what is the balance? What are the payments? Is that PITI?
    Any back taxes? Other liens?
    Are they behind on payments?
    Is it occupied or vacant? Was it owner occupied or tenant occupied?
    Any code violations?

    It is going to take a trip to the area to get this information… take a contract to lock it up while you are there (just in case it is good)

    If you get a contract, start planning for a Highest Bidder Sale the weekend of June 7th.

    I have travelled all over the place to do deals. Florida, Colorado, Hawaii, California — and all over Texas.
    But these were usually multi million dollar properties with six figure profit potential. I would not travel too far unless I could make a substantial profit.

    I’ve had the opportunity to deals in many other places all over the world but the numbers were not good enough to justify the trip.

    I was really tempted to take on selling a condo complex in Belize and a office building in Mexico (both owned by the same seller) but the weather is too darn hot. I was recently contacted about 3 houses in Nova Scotia but took one look at the pics and knew I could not sell them because it was just ugly. I can’t sell something I don’t believe in 100%

    One time Jack Miller asked me to go to Kingman Arizona to help him sell 1,000 lots. I flew in to Vegas, rented a car for the drive to Kingman. But when I got there I had to break the news that I could not sell the lots because I thought the area was just ugly. I told Jack I would not give him a $1 for each lot. I can’t sell something I don’t believe in! I can’t understand why anyone would want to live there. He bought them at a tax sale and probably got them for about a $1 anyway knowing Jack.

    Last week I was contacted about a house in Ecuador. I’m still investigating the numbers with the help of a friend who lives there. If it is good, I will go there to sell it. (I’m going to Ecuador for a few weeks in June anyway so I can check it out then)

    So, yes you can do long distance deals, but it has been my experience that it won’t sell and it won’t close unless YOU go there to make it happen.

    Another thing to keep in mind – while you are 2 1/2 hours away from your home market, a great deal could pop up that you can’t get to fast enough because you are in the other town.

    Wow Jackie – You always impress me with the care and detail of your responses.

    That’s kind of what I thought too. I will have to investigate the numbers and see.

    Thanks

    I lived in Dallas texas when I first got started in real estate investing. I thought the bigger area I covered, the more deals I could do. One day I got a call about a 4plex in Fort Worth I could get for less than 1/2 price. I made the 1 1/2 drive (one way) to go see it. The price was great but the neighborhood was border line WAR ZONE so I passed. It would have been very hard to sell.

    While I was away from the office for that 4 hours I missed a great deal. I talked to the seller and told them I could go see it that afternoon but another investor got there before I did. He flipped it for a $10k profit.

    I missed a $10k deal because I was too far away to get a contract.

    Something to think about!

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