My husband and I discovered a way to mix two real estate niches together. The last two months have kept us quite busy working with expired listings. I was unable to write a blog for August b/c the pace of our business has increased dramatically. The reason we're working with expired listings is to reach those homeowners with properties that never sold. Either the realtor failed to properly market the property or it never generated enough interest. We work with a few select realtors--with whom we can do repeat business. One realtor sent us over 5K expired listings, which will keep us super busy over the next few months.
One realtor charged a fee which is perfectly acceptable, since we didn't want to waste his time. Likewise, while ferreting through these expireds, we sent letters to motivated sellers. Our monthly goal is to mail 400 letters to 400 sellers with an expected response rate of 2%, maybe more. The beauty of this system is while finding single family homes to wholesale, we're meeting motivated sellers with multifamily properties they want to liquidate. Mostly, these sellers want to retire and not be bogged down with properties requiring so much of their attention. Of course, they could always outsource their property management while freeing up their time to continue investing.
However, these sellers are looking to sell their properties at more reasonable prices, rather than inflated ones. Their proforma numbers are more real and down-to-earth and we have found they're not playing games. Sellers in Baltimore, MD and surrounding areas ask insane, unreasonable prices, placing themselves out the market. I have found they're also unwilling to negotiate. Once I begin crunching their proforma numbers, running them against the comps (of recently sold properties in the area), do I find they're asking way too much. When that happens, I know from experience that the seller's head is in the clouds, out of touch with reality.
The beauty of wholesaling a single family home or multifamily apartment building is how seamlessly the two real estate niches blend together. While working monthly to wholesale at least 4 single family homes and putting them under contract, do we begin working with multifamily properties from these sellers we otherwise wouldn't know about. As time permits, I will update this blog on how our simultaneous wholesaling and investment of multifamily apartment buildings is progressing.