In my conversation with wholesaler Cody Hofhine, he explained his process to make $250,000 profit in your first year wholesaling. Step two of the five step process is to “Build a Big Buyer’s List.”
Thankfully, Cody was able to go into more detail on this vital step, and here is his two-part trick for creating the ultimate cash buyers list.
Step 1: Go to Craigslist
“The fastest way to put 25 cash buyers [for real estate] on your list today [is to] get on Craigslist and go to the ‘rental’ section, look for the ‘real estate’ section, and then look at the ‘for rent’ section.” Once there, you’ll find two different types of listings: (1) the actual homeowner (landlord) that’s renting the house or (2) a property manager that is responsible for filling the vacancy.
Step 2a: Approach for Property Manager Listings
Pick up the phone and call the number listed for the property manager. “All you’re going to do is tell them, ‘hey, I am a local investor, I come across deeply discounted properties all the time. Do you have landlords and investors that you manage their properties currently that are looking to add more properties to their portfolio?”
Cody then goes on to explain the results he has seen from this approach: “9 times out of 10, that property manager is going to say yes. And the reason why is because if you can push that property to the property manager and then the property manager can push it out to his investors, he himself just picked up another home that he can then manage, so he’s building his portfolio in turn as well.”
With just one phone call, you could come away with 25 names, or 100 names for that matter! All you need to do now is rinse and repeat, and you’ll have a massive cash buyers for real estate in no time.
Step 2b: Approach for Landlord Listings
Pick up the phone and call the number listed for the landlord. For Cody, the primary objective is to purchase the property, and the secondary objective is to get a name for his buyer’s list. So when the landlord answers, he will talk about the property first:
- Cody – “Hey, I’m out in front of your house right here at 123 Main St. Is it still for rent?”
- Landlord – “Oh yeah, it’s right in-between tenants.”
- Cody – “Okay, well I’m looking for a property in this area, are you interested at all in selling this property?”
At this point, Cody will just sit there and listen. He proposed the following example: the landlord “is in-between tenants, so there’s a chance that he might be frustrated with what maybe the last tenants just did to the property. Maybe they just dumped concrete down the toilets or whatever it may be. So you might be able to get a deal that way.”
If that is the case, fantastic! But since we are learning how to build a buyer’s list, let’s presume the conversation continues like this:
- Landlord: “Oh you know what, I actually like this rental. Not looking to sell it. It does a great job for me. I love it.”
- Cody: “Well I am a local investor. I come across deeply discounted properties all the time. Are you looking to add more rentals to your portfolio?”
And analogous to the property manager conversation, Cody says, “9 times out of 10, these landlords will say, ‘absolutely, let me know about it.’ Get their name, their number, and email address, and it’s as easy as that.”
Why Build a Buyer’s List?
Many newbie wholesalers come to Cody and say, “how do I find my first deal? What is the best way to find my first deal?” If you don’t have the end in mind (in the case of wholesaling, this end would be having cash buyers for real estate deals you find) it doesn’t matter how many deals you have or how good the deals are because you won’t be able to sell it to anyone. So, before even finding your first deal, you have to start by building a cash buyer’s list. Build up a massive list so that you are able to easily sell those properties and do whatever you need to do in order to make a profit.
Cody’s two-step process is a great place to start, but here are two more techniques to aid in building a massive buyers list:
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Disclaimer: The views and opinions expressed in this blog post are provided for informational purposes only, and should not be construed as an offer to buy or sell any securities or to make or consider any investment or course of action.