5 Reasons You Will Fail At Wholesaling

Tough Times Call For Tough Words: Wholesaling Real Estate Newbiesmotivated sellers

Since the crash of 2008, its obvious the real estate market has not been the same. When I got started wholesaling, all I would hear about was how much money random wholesalers were making during the boom, I’m talking MILLIONS! Since then, however, many wholesalers have failed to do just 1 deal, if that. Interesting…

Before the crash, any human with breath in their lungs could make money in real estate, especially wholesaling. However, times have changed and the tougher economic tides showed that many were not real business men. A TRUE business man/woman was doing real estate before the crash, and still doing it today.People like Kenny Rushing, Than Merrill come to mind.

What has helped these investors stay ontop of their game? Well, info-marketing comes to mind… LOL, jp.. its MARKETING, SYSTEMS, FOCUS, WORK ETHIC, and UNDERSTANDING THEIR SITUATION.

Too many wholesalers FAIL and WILL because they fall into one of these five categories. The purpose of this is to shine a light onto it and help newbies recognize what they may be doing. A few adjustments and proper attention to detail and BOOM, you too could have deal after deal closing.

Below are 5 Reasons Wholesalers Fail:

1. No Marketing – “WHAT YOU MEAN YOU AIN”T GOT A MARKETING PLAN?!” This is what I think every time I ask a wholesaler what their plan is. In a previous article, go over making a wholesale marketing plan in detail and is still relevant today. The main issues wholesalers run into is lack of leads and a slow pipeline. The reason for their pipline being weak is a direct result of weak marketing.

You must always be putting out signs, letters, ads, and have a system to repeat the process every week. Its as simple as keeping a map handy and dotting where you posted a sign. Creating a map on Google and using that to help guide you is a very easy and effective way of starting your marketing campaign. Notice I said “campaign”, because you must repeat your system every month.

2. Info Overload – Not going to even lie here, I was info overloaded and still am to some regard. However, the information to get started is basically FREE and there are more then enough horror stories out there to scare anyone out of wholesaling. It has come to a point where people just sign up to way too many webinars, lists, Facebook Groups, etc.. and dont take any action.

We easily fall into a weird state which we feel productive, just because we read. This has stunned the growth of many people, me included, and the internet does not make it any easier. I suggest you ignore the REST of the web and pick 1 strategy and narrow down your gurus to about 1-2. In fact, unsubscribe from everyone elses email list and keep it simple stupid.

Wholesalers will run around with no idea of where to start because by the time they make a decision, a new product comes out and its shiny object syndrome all over again. So if you are serious, you will take action asap and ignore the rest of the talking heads, ME INCLUDED!

3. Over Compensating With Technology – I have nothing against Freedom$oft or OpenRoad, they are great CMS’ and should be used as part of your business. Quick re-read that last statement, you see that? I said BUSINESS. Unless you have a business and some cash coming in, all you need is a Google number, signs, and a spread sheet.Boom.

Often I get requests on my opinion on these tools, and my response is always, “how many deals have you closed?” And for the most part, the answer is none. NONE! The same amount of money you spend on that tool could be used to get your phone to ring!! What else do you need, a list of cash buyers? Yeah, you dont need a CMS for that…

Bottom line: STOP with LAZY THINKING! Nobody is going to answer the phone for you, write up reports, send emails, negotiate, learn the market, etc. Get your a$$ out there and leave Facebook at home.

4. Lack Of Hustle – When do you think you should be looking for a buyer? Before or after you get a lead? The answer…. ALWAYS! It surprises me how many people do not put in proper work behind their business. If I sat down and explained everything that goes into doing a deal, it seems fairly easy. However, where many real estate wholesalers fall off is their follow up. MONEY is in the follow up.

Half of your future business is in relationships you build. There is always a buyer you can call, a seller that needs motivating, a agent who wants to sit for coffee, an attorney who has short sales etc… But most don’t even go beyond a few calls! C’mon people, too many will fail because they have bad follow up skills.

5. No Money – For anyone to be successful there must be an investment. For most, its usually time and a little money. For anyone looking ot invest in real estate who has absolutely no cash left to invest at the end of the month; good luck. Seriously, if your looking to wholesale in Chicago, in winter, you must absolutely have a minimum of $300 a month for 3 months for a minimally effective marketing campaign.

This is where people get lost when they listen to Gurus talk that “10K in 10 days” crap. Maybe in Florida, not in Chicago. The pipleline is everything and having constant cash buyers is a must. No buyers, no deals. No money, no marketing…

Wrap Up

Well everyone, I hope you enjoyed that little lesson on wholesaling. Its my duty to those who want their first deal to understand what they are getting into and what needs to change for a deal to come through.

Cid da Kid

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2 People have left comments on this post

» J. Graybill said: { Jan 23, 2014 - 11:01:04 }

Hey great article! I’ve fallen into most of those traps in my career, and in my opinion, the biggest mistake people make is thinking it’s easy, and one click. It is easy, but in the same way working at subway is easy! In other words, you have to get off your a** and work. Someone has to make those phone calls, and if nobody answers your phone well…, that lead is now someone else’s.

» tom c said: { Dec 24, 2014 - 11:12:37 }

This was the best straight talk I have got in a while. I am not new , have not made a deal yet, but I find myself just dabbling. I am tired of chasing seminars and programs, and I have learned in going to them that there are a lot of attendees at these events like me, It is time to get very serious and believe that I am a wholesaler. To be honest I might have been able to have bought a junker house on my education. Thanks for telling it like it is!