Wholesaling Properties: Where to Find Real Estate Deals Today
Where can real estate investors focused on wholesaling properties find more deals with less competition and bigger spreads today?
There is no question that we are at a unique moment in history which offers the ideal combination of factors for flipping houses for big profits. However, some newer real estate investors are reporting that the appeal of real estate as an investment is stirring up a frenzy of competition. Fortunately there are several hidden sources of distressed property deals with highly motivated sellers which can provide investors with endless incomes.
Where are they?
The Challenges Facing Distressed Property Investors Today
While the stars all appear to be lined up perfectly for making a killing from wholesaling properties, some investors in some pockets of the country are finding they face tougher competition daily as swarms of new investors swoop in to bid up the prices on hot foreclosure deals.
Real estate hot spots like Manhattan, Sacramento, Phoenix and Miami now frequently see a dozen investors squaring off in bidding wars when it comes to bank owned REOs, foreclosure auctions and yes, some of these bidders are big fish with very deep pockets.
However, this by no means suggests that there isn’t a plethora of deeply discounted, distressed properties out there ripe for the picking.
So where can easier deals with less competition and bigger discounts be found in sufficient volumes to propel investors to meet their goals?
Institutions Offering Hot Deals on Off-Market Homes
It is true, to a certain extent, that some of the nation’s biggest mortgage lenders and banks have become more difficult to deal with and get the sweetest discounts from. However, it is also no secret that new foreclosures have been surging in a number of states and lenders are keeping a tight fist on the throttle and flow of REOs in order to boost housing prices.
Morgan Stanley analysts recently reported that while so called ‘shadow inventory’ has dropped significantly in 2012 there are still an estimated 5.7 million foreclosure homes out there hiding off the market. That means masses of opportunity for those wholesaling bank owned homes, if only they know where to look.
A few savvy investors are now using this information to jump ahead of the crowds and directly approach institutions to acquire these properties before they go on the market. You may have no luck with this approach at Wells Fargo or Bank of America, but what about trying smaller regional banks and credit unions? Have you tried leveraging LinkedIn to hone in on the top decision makers at these institutions and capturing their direct contact information?
For those really ready to turn up the heat and the volume of homes they are flipping, it may also be worth checking out corporate asset managers, hedge funds and building relationships with local bankers and mortgage brokers to help those turned down for refinances.
The Secret to Generating High Volumes of Discounted Property Leads
Wherever investors live, there are bound to be a wealth of pre-foreclosures, neglected homes and perhaps even vacant rentals begging to be bought at a discount. Even though property owners may have resisted assistance and offers in the past, the fast tracking of the foreclosure process has caught many off guard, making them much more motivated to cut appetizing deals quickly.
Of course every other real estate investor in town could be driving by the same homes and acquiring the same lead lists, creating burnout among homeowners who are being bombarded with marketing from all angles.
So how about some nice, warm, fresh leads on motivated sellers who actually want to listen?
How about focusing on forging new strategic referral partnerships instead? Then each prospect could be worth 10 fresh leads each and every month, rather than being a one shot deal.
Remember there are many other reasons for property owners to be distressed, besides falling behind on their home loan payments. Think probate, divorces and separations, falling behind on HOA and condo association dues or simply a rapid rise in other housing expenses such as insurance and utilities.
4 Ways to Capitalize on These Real Estate Deals
- Make appointments to lunch with professionals handling these clients once per week
- Start a local networking/ mastermind group
- Those who love technology can create their own affiliate programs
- Hire someone on a commission basis to bring in referral partners
With all this access to highly motivated sellers and discounted properties there should be no reason those wholesaling properties can’t double their deal volume in the next 3 months…
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