need some help
- Thread starter Brandon36
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If you are planning to invest, contact a realtor who is also an investor.
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I can refer you to a good realtor in the GTA if you would like.
Also if you are wondering where a good place to start it is I would recommend any of the books written by the head R.E.I.N members and start checking out kijiji and pad mapper figure out what the rent is in your target area before you start looking at properties then you will know your price point. Pick a strategy and stick with if you hop around from idea to idea you will burn out or get stuck in analysis paralysis before you are ready to make that first deal. Buy and hold investments are relatively simple to learn and a lot more forgiving so maybe try there first. Sit down alone and decide what skills and or assets you bring to the table and then work on locating professionals who can fill in your weak areas. i.e if your not handy then look for a handy-man, if you're bad with number and accountant etc.
Also if you are wondering where a good place to start it is I would recommend any of the books written by the head R.E.I.N members and start checking out kijiji and pad mapper figure out what the rent is in your target area before you start looking at properties then you will know your price point. Pick a strategy and stick with if you hop around from idea to idea you will burn out or get stuck in analysis paralysis before you are ready to make that first deal. Buy and hold investments are relatively simple to learn and a lot more forgiving so maybe try there first. Sit down alone and decide what skills and or assets you bring to the table and then work on locating professionals who can fill in your weak areas. i.e if your not handy then look for a handy-man, if you're bad with number and accountant etc.
Thanks that's well said. I have been real a couple books from the R.E.I.N team and I have got a way better understanding of how this all works. I wanted to start by wholesaling because you need very little cash or credit. therefore I can use the funds that I make and invest it back into my business to get more buy and holds deals. so your not just stuck with one property and cant qualify for another mortgage because funds are to low. and I also started checking out kijiji and that helps a lot. I did not no I can get that much information from there thanks. And also would you think its best to just cold call these people and let them know what your looking for?
ok sounds good thanks for the reply. So when I find one is it best to just tell them what im trying to do and see if they will help?. Cause I would think some agents would just want to be looking for deals or more experience people to network with rather then dealing with someone new that they will have to help out.
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Well yeah that could work. I would recommend you don't put all you hopes into wholesaling though, out of all the strategies it is the cheapest and quickest to implement but it also comes with the highest risk and requires very in depth market knowledge. If you plan on wholesaling I would recommend finding a job as a realtor assistant or making good friends with one, you will need to know the market inside and out and you will have to focus on very specific areas to begin, that way you can be sure a property is undervalued. As far as i know the wholesaling formula is market value x .70 - repairs= purchase price, in the GTA I can imagine properties will be very difficult to locate at 70% of market value. Also the other side of the coin is building a database full of flippers and developers to assign these contracts to. I personally tried this 2 years ago with no success, I found it much easier to work overtime and save up the down payment and then purchase in a cheap market with good upside and strong demographics.
I wouldnt put all my hopes into wholesaling but I would use it to generate that cash to buy my buy and holds. and I know there are a lot of risk but I was taking to an investor before I wanted to start investing and he has done it and built a business around it and he said with a good lawyer and contract there are ways to make sure your always protected. I would need to know the market inside and out though. but instead of looking for an undervalued property which will be like imposable to find in the GTA. I want to aim for motivated sellers, as in people that need to get out now for whatever reason, could be divorce, foreclosure, probates, new job in different area, want to be closer to family, a fire damaged house, expired listings etc once you find someone that needs to move out right away. the price then becomes cheaper then market value because they want out now therefore you can make an offer 70% below price and since there really motivated they don't want to wait for a realtor to sell there house in 6 months therefore they go with you. that's my way I would approach the wholesailing business. A buyer list will make it self as long as you get the property 70% below market value in a good area and market right. buyer will come most likey. the thing what I don't like about wholesaling its not constant like a buy and hold unless you have a bunch of leads.
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If you're confident that you can sell them within a certain time frame, why not just do up a purchase and sale agreement with a condition removal date based on your time frame, say 2, 3, 4 or X months. If you find a buyer in this time frame, sell your contract to them. You'll need this clause as a term - "Buyer discloses that buyer may move into the property, rent out or sell for a profit to a third party before or after closing. Seller will in all aspects cooperate to facilitate sale to a third party buyer". Disclose fully to all parties involved what your intentions are - which is "sell for profit". Maybe too advanced for you starting out, but if you're up to the task, ensure your marketing doesn't say "House for sale", it can be worded creatively "Great Family Home, Gorgeous Location".
Ok I no what you mean. this is also called wholesailing if im right. That is the way I think is best to start out to get more funds to fund your buy and hold deals for passive income. find a motivated seller and get the property under contract and within the contract have the right to sell your interest to another buyer. I was reading upon some stuff about real estate but didn't no if that was possible to do. But this makes the most sense to me in starting out so im going to go towards that. thanks for the help
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Before you waive conditions understand who will manage this property impeccably.
Get a variable rate mortgage, even lower as of this morning. Sub 2% !
Get a variable rate mortgage, even lower as of this morning. Sub 2% !
What exactly do you mean waive the conditions? is that basically giving the ok for the tenants to move in
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No...Wholesaling is you buying the property, transferring title to your name or a your corporation and then selling. With this method, you are taking the property under contract, advisably through a corporation you open, and finding a buyer. Your costs are marketing and a little something for the sellers if they have no equity, which would be part of the reason they'll call you.
If you're interested in making money, as most Wholesalers are, first spend a bit on your education, join Rein, and then make the flight out to BC on September 25th for Barry & Donna McGuires "Rapid Cash Focus Program".
If your DESIRE is strong enough, this measly cost, could easily be made up on your first deal or two. An old educator of mine and many other REIN members once said "What you put between your ears, determines what goes in here"(he was pointing into his open wallet).
I thought you don't need to buy the property as a wholesaler. in the terms of the contact before you "purchase" the property wouldn't you be able to have in the contract that you will poetically purchase the property OR assign the contact to a third party therefore you wouldn't have to buy. once you agreed on 3 weeks to close lets say you then have equitable interest in the property which means you can market it and sale it before you close on it yourself. and if you cant find a buyer then you protect yourself by being able to assign it or you can say the numbers never worked out for your company etc. therefore you wont have to buy it. I could be wrong but this is the way I was taught from reading etc.
and also I just brought one of there programs on here called creative quick turn real estate by Barry and Donna McGuires and its been helping me alott. that's where i learned some stuff about wholesaling and that's a very good quote that's something I would never forget thanks for the information
I wanted to start out wholesailing because im starting out young and don't have a lot of capital built up. Do you think that's a good approach to take?
no problem, I am new to this I haven't done one deal yet, but I do a lot of research and want to educate myself as much as possible before jumping in. I just love the help I get from other people like you to really help me get a better picture and understanding of how this all works.
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Hi Brandon.
I am chiming in a little late here, but I had all of the same questions as you and I did not find this post last summer. Have you completed your first wholesaling deal ?
I just got started out by buying my personal residence with a basement suite. Found great tenants using all of the information on here. Including the excellent Tenancy Focused BC workshop Audio and Forms from June 25th - available to REIN members.
I paid a lawyer about $500 to draw up my own contract for wholesaling. I realize that that was not required if you add to a standard contract ( addendums etc), it was to be on the safer side. My clauses are clearly laid out and lowers the risk of this type of deal.
After collecting rent from my tenants, I have realized that buy and hold is truly the way to go for long term investing, but have not thrown out wholesaling as an option, it just requires more work, in finding leads and property analysis.
Id like to hear from you. Feel free to shoot me a PM.
I am chiming in a little late here, but I had all of the same questions as you and I did not find this post last summer. Have you completed your first wholesaling deal ?
I just got started out by buying my personal residence with a basement suite. Found great tenants using all of the information on here. Including the excellent Tenancy Focused BC workshop Audio and Forms from June 25th - available to REIN members.
I paid a lawyer about $500 to draw up my own contract for wholesaling. I realize that that was not required if you add to a standard contract ( addendums etc), it was to be on the safer side. My clauses are clearly laid out and lowers the risk of this type of deal.
After collecting rent from my tenants, I have realized that buy and hold is truly the way to go for long term investing, but have not thrown out wholesaling as an option, it just requires more work, in finding leads and property analysis.
Id like to hear from you. Feel free to shoot me a PM.
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- Aug 30, 2007
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The best wholesaling platform is
A) midnight TV
B) an overhead projector from overhyped usually US based real estate firms
It certainly works poorly in provinces with land transfer taxes and efficient mortgage markets !
It only works for well connected cash rich ( usually older) investors that have access to distress sellers say via divorce or estate lawyers !
Not a strategy for younger folks unless you can close in cash and know how to access highly motivated sellers well below market.
A) midnight TV
B) an overhead projector from overhyped usually US based real estate firms
It certainly works poorly in provinces with land transfer taxes and efficient mortgage markets !
It only works for well connected cash rich ( usually older) investors that have access to distress sellers say via divorce or estate lawyers !
Not a strategy for younger folks unless you can close in cash and know how to access highly motivated sellers well below market.
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- Aug 30, 2007
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- 13,881
Only with loads of cash is this even a remotely interesting strategy !
Focus on your career in a well paying profession if you are young and lack capital.
Real estate is designed as a part-time investment strategy initially. Only once you have a few hundred thousand or better over $1M to invest should you consider it as a full time business.