(Note: Want the best system for fixing and flipping houses in the world? This brand new report exposes our step-by-step formula for wholesaling houses site-unseen in ANY area of the country … all from the comfort of your cell phone! Learn more.)
What do you do when your wholesale deal isn’t selling?
If it’s a deal that’s good, there’s usually no problem selling it. You know, you’ve got your “favorite 5” list of buyers that you text about the deal, it sells and you’re all good.
But when it doesn’t sell quickly, you know there’s a problem. Most likely, your contract price is too high.
Someone who knows all about this is one of our esteemed Mogul Advisors, Mr. Joe McCall, a lease option and wholesale expert. As Joe explains, you have a few options…
Option #1: Renegotiate the Price
If you are hearing the same story from your buyers – that the property price is too high – than you may need to renegotiate the price with the seller. If the numbers don’t work, then they don’t work. It’s that simple.
I am completely comfortable doing this because my sellers understand that it’s possible for me to ask them to lower the price during the inspection period. I always explain that we have an inspection period for my funding partners who are on board with me and sometimes, if they are not, this may mean renegotiating price.
I just tell them straight out, “Here’s the deal… This is what we are going to have to do to close this property…” You then hit them with a price drop.
Option #2: Expand your Buyer’s List
You can also expand your pool of buyers by trying to figure out who is buying on the MLS. They will usually pay more because they are buying on the MLS. Sometimes you just have to find a cabbage head, which is what I call a new buyer – a brand new person looking for a deal.
They may be willing to pay more because they want to get in the game.
I think it’s important to understand that if you are close and it’s a marginal deal, you should still get under contract. If anything, you can increase your buyer’s list so you can start marketing the home and start finding buyers to come to you.
Even if you have a buyer that says they’re not interested, ask them for what price they would be interested. This is great feedback to figure out what the real problem is so you can sell the property.
For most of our deals we wholesale today, we have a buyer before we even get it under contract. We will have our buyer go look at the house (or their property manager go look at the house) and if the property manager says they like it, then they will buy it. You really have to focus on getting a great buyer’s list as you go along. But you also don’t have to have a buyer’s list before you get into investing. Your buyer’s list will build itself and you will become known through your experience.
I have a little trick I do when I have a property I really need to sell and need to find a cabbage head. I will find out who the investors are – especially in the specific area of the property I am selling and then create some yellow letters to find buyers through MLS, Craigslist or wherever else.
My handwritten yellow letter (and I crumple the paper up for a desperate effect) will be something like this:
Remember though, hand write your yellow letters. You can google ‘yellow letter’ for more examples.
Option 3: Back Out
You can always back out, but if you’re like me, you’re a fighter and you go down fighting.
Bottom Line
Be aggressive. Don’t hyperventilate, jut renegotiate the price if you have to.
Extra Credit
Read these for extra help: "How to Renegotiate Your Wholesale Deal" and "Why You Should Always Get an Offer"
Holla at us
Have you had an experience in which you had to renegotiate the sale price? We wanna hear about it in our comments section below.
Use List source, MLS, etc. to find recent cash buyers in the area of the property...
Send them a crumpled up "yellow letter" (as if you're a motivated seller desperately looking for a buyer).
Call landlords advertising in the same neighborhood on Craigslist.
Remember: Don't think you have to have a large buyer’s list to start marketing for sellers... you'll be building your buyer’s list in real-time as you market your deals aggressively.
Joe McCall
has been investing in real estate for over 5 years. His background and education is in Civil Engineering. Before he started working on his real estate investing business full-time, he had worked for several large engineering & construction companies all around the country. Joe has tried tons of different investing strategies, but his favorite two have always been Lease Options & Wholesaling. When he got tired of spending over $3,000 a month in marketing for his wholesaling business, and throwing away so many leads from unmotivated sellers, he knew there had to be a better way. That’s when he came across the special niche he calls "Wholesaling Lease Options". As soon as he started implementing his simple, unique system, within 3 months his part-time income quickly surpassed his full-time income. Needless to say, he quickly left his job and has never looked back. Joe McCall is still working part-time and easily flips 2-4 lease options a month at $3,000 - $6,000 a pop. In addition to doing deals and working in the business every day, Joe coaches and mentors several select students in different parts of the country.