Wholesale experts how to make 6 numbers

  • Real estate investors agree that wholesale trading can be an efficient way to make money.
  • To be successful, you need to network with other wholesalers and build a list of potential buyers.
  • Then you should find a potential seller, which involves cold calling real estate and land owners.

Todd Baldwin has never found a more efficient way to make money than wholesale real estate.

“In terms of hours worked in exchange for dollars, I haven’t found anything better than wholesale real estate,” the Seattle-based investor told Insider. And Baldwin has a variety of revenue streams, all of which earned him more than $1.5 million in 2021, according to documents viewed by Insider.

Wholesaling works in such a way that the person acting as the wholesaler contracts a home or property, finds a buyer – typically a real estate investor – who is willing to buy it at a higher price, and then pocket the difference in price once the transaction is complete.

For example, in Baldwin’s most recent deal in May 2022, the seller wanted $800,000 for his property. He didn’t want to list it on Redfin or Zillow, deal with open houses and realtors, and lose money in brokerage fees when he sold it. Instead, he wanted to make what he called an off-market deal — and he turned to Baldwin to execute it.

“We agreed that if I could sell it for over $800,000, I would just do what the Delta is: so if I sold it for $825,000, I would make 25 grand,” explained Baldwin, who ended up selling the contract house for $900,000 and a profit of $100,000. Insiders confirmed the sale by looking at the seller’s statement.

Another Seattle real estate investor makes six figures wholesale. In his first deal, Ludomir Wanot profited from $160,000.

Shortly thereafter, he decided to quit his job at Amazon to focus on wholesale. In August 2020, he co-founded wholesale company Evergreen Housing Network with business partner Vernie Gonzalo Dahl. Wholesale remains its largest source of income. In 2021, Wanot and his partner earned nearly $1 million in profits, according to documents viewed by Insiders.

“We find people who want to sell their homes without having to go through the hassle of listing them in the MLS or waiting months for their home to sell,” Wanot explained. “Once we have a property under contract, we find a buyer from our list of investors or homebuyers and sell them the property directly at a higher price. Our company earns an assignment fee for every deal we close, similar to how real estate agents earn a commission for selling a home.”

Wanot’s team of 11 executes about sixty deals a year and averages $35,000 in revenue per deal, he said.

However, it is possible to wholesale on a smaller scale. That’s how both Wanot and Baldwin got started, and they didn’t know much about the process at first. “I didn’t know the hell what I was doing,” Wanot recalled of his first deal.

To help other newbies get started, Insider has compiled their advice and put together a four-step guide to wholesale real estate.

1. Find out how wholesale works

If you are starting from scratch, you must first understand exactly how wholesale works.

“Reading or listening to audio books is the cheapest way to learn wholesale,” Wanot said. “Before I venture out, I want to learn as much as possible so I can minimize the likelihood of making costly mistakes.”

His favorite wholesale books include: The Real Estate Wholesaling Bible, If You Can’t Wholesale After This: I’ve Got Nothing For You, and The Best Wholesaling Book Ever.

You can also educate yourself on the subject by taking an online course or by watching YouTube videos, Baldwin said.

2. Network with other wholesalers and create a list of potential buyers

The sooner you start building a list of potential buyers, the better. After all, once you get in touch with someone who wants to sell their property, you need to find someone to buy it.

“Join real estate investment groups on social media that are local to you,” said Baldwin, who is a member of several Seattle-specific investment groups on Facebook. “Within these groups I will post, ‘Who is interested in buying property off the market?’ And over the past three years, I’ve built a legitimate buyer list of about 15,000 investors.”

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Seattle-based real estate investor Todd Baldwin.

Courtesy of Todd Baldwin

Do a Google search to find a community in your zip code and attend local real estate meetings. It will help you build your network and meet some of the active buyers in your area. Also, you can connect with other wholesalers or people who are already doing what you want to do and ask them how they got where they are.

“Surround yourself with other like-minded people who have successfully built their own wholesale business and learn tips and tricks that have worked for them,” Wanot advised. He recommends connecting with other wholesalers through Facebook communities, sites like Eventbrite or Meetup, and wholesale conferences, which typically happen a few times a year.

3. Drive through neighborhoods to find properties and a potential seller

When Wanot started wholesale, he spent an hour every day driving through the neighborhoods in his area looking at properties.

“I wrote down the addresses of all the distressed properties,” he said. “After that, I used needtoskip.com to skip all the owners’ phone numbers and called each one individually to see if anyone was looking to sell their home.”

He had written a script that he used every time he cold called someone. It was a tedious affair and “a lot of them were really angry that I called,” he said. It took about 300 calls, but a landowner interested in selling his property finally picked up the phone.

“When you call someone, make sure it’s the person Not on the do-not-call list. It’s illegal to call anyone on this list,” he noted.

Baldwin also called cold when he started. He called landowners, particularly those who list their properties “For Sale By Owner” (FSBO). You can find FSBO listings on Craigslist and Zillow, he said.

“I just picked up the phone and started calling,” he said of his first wholesale deal in October 2021. Apparently he had a bit of beginner’s luck: “It didn’t take me very long – five or six phone calls – to find someone who was interested was to sell me.”

You can also contact local wholesalers in your area and see if they need help with one of their stores, Wanot said. He used a Facebook group called WA Real Estate Investing to reach out to local wholesalers, and two of the people he contacted ended up needing help with their transactions: “I offered to find a buyer for their deals and they offered to share the order fee from the deal with me. I ended up selling one of the two houses and making $20,000 in a transaction.

If you’ve got a bit of a budget, there are ways to outsource cold calling, Wanot added. For example, “ringless voicemails can be run through software like Roor, which gives customers the ability to address large groups of people simultaneously at low cost. Once homeowners check voicemail and want to sell their home, they can contact us directly via text or phone call.”

4. Sell the property

Once you have found a seller and have a property under contract, it is time to sell it.

Ideally, you already have a list of buyers in your area that you can reach out to. To expand your list, “follow other investors or fins who are buying off-market homes,” Wanot said. “Use an Excel spreadsheet to keep their email and phone numbers in one place and contact them if you have a property for sale.”

To start marketing the property, simply capture a video of the room on your phone. Email it to your buyers list along with a description of the property. Here’s what Baldwin does: “To be efficient, I use an email template with links and photos. I just change the name of the person I’m sending it to and then I can send it to the entire list.”

Of the thousands of people he contacted about the property, about 100 followed suit, he said: “Of the 100 people who wanted more information, three people actually wanted to take a tour of the property, so I gave tours for three people. I lined up the tours back-to-back-to-back in one day to be as efficient as possible.”

One of those three eventually made an offer, which Baldwin accepted.

Baldwin wrote the contract for the deal himself, using LegalZoom, a website that lets you create legal documents without necessarily hiring a lawyer. “I found a template on LegalZoom that was exactly what I needed. It took me maybe 12 minutes to write the contract,” he said. “And I didn’t even pay for it. I used a free trial and then canceled it.”

Then he used the free version of DocuSign to complete the contract. “I wrote the contract for free on LegalZoom and had the buyer sign it with DocuSign for free, so my total expenses were zero — other than the gas I spent driving to the property for the demonstrations.”

If you don’t have an extensive list of buyers, you can always work with other larger wholesalers, Wanot said: “If you’re just starting out and haven’t built your credibility or your list of buyers yet, another experienced wholesaler can help you sell your property for example Sell ​​50% of the order fee through their buyer. This will ensure that you can close the seller’s house and make your first deals at a profit.”

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