Real Estate Investing: Avoid These Costly Real Estate Wholesaling Mistakes
Posted by ericmedem | Posted in Wholesaling Real Estate | Posted on -05-2008
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There are numerous reasons why many newbies to real estate investing never realize any success in real estate wholesaling.
In this article I am going to focus on one step of the wholesaling process that so many investors get wrong. The sad part is that many of the guru wholesaling courses that I have purchased actually teach newbie investors the wrong way.
From my experience the most critical factor in the entire wholesaling real estate equation is having a solid buyers list in place. Many newbie investors make the mistake of focusing their energies on locating great deals on houses prior to having any investors to buy those houses. The best deal in the world is no good unless you have a buyer lined up ahead of time. Sure, you can find buyers after you have found a good deal, but going that route has some large risks:
Risk #1 One of the main risks of finding buyers after you find motivated sellers is that your chances of being able to follow through on the contract decrease substantially because you are starting from scratch.
Risk #2 If you cannot follow through on your real estate contracts, then you will quickly start building a reputation as someone who cannot follow through on promises. Having a good reputation is critical to success in the long run. If you over promise and under deliver to the wrong Realtors or investors in a particular market, then your options for finding great deals, and selling those deals will quickly decrease substantially.
Risk #3 Your profits can decrease substantially. Because you are starting from scratch with your buyers list, you may end up having to sell your contract for far less than what it is worth simply because your buyer options are so limited.
Follow these 3 simple rules to get well on your way to real estate investing success.
