3 Reasons Why Wholesaling is NOT Easy | Data Talk

Wholesaling in real estate is a hot topic to find deals. In my journey, I have found it is not as easy as it seems. In this video, I will cover my data insights at the start of my wholesaling journey.

Transcription

Ariel Herrera 0:00

Hey everyone, today I want to talk to you about why I'm going to be getting into wholesaling. My name is Ariel Herrera with the analytics area our channel, we bridge the gap between real estate and technology. Most of the focus of this channel is looking at different types of data sources that can help us evaluate if a deal is good or not. Now, in my case, I've had a really difficult time over the last several months trying to acquire properties because of this really crazy market, where it's even taking me to look internationally. However, I think it's time for me to actually take the next step, go into wholesale and tried to find motivated sellers, I think it could be a really great way to also expand this channel to look at more tools, and also be able to collaborate as a whole as a community to share different resources, and the very beginning of it. So I'm going to be sharing with you my journey, usually every Monday with a new video, I love for you to leave comments as well as any data tips. So there's three things I want to cover. First, what is wholesaling? To begin with, if you're not aware, it's a way to look for motivated sellers get a house under contract and sell at a profit, usually to an investor. So for example, say if someone is going to pre foreclosure or through a divorce, they need to need to sell their house in a quick timeframe. So it's not enough time for them to put it on the market. Or maybe it's distressed, so it hasn't been updated in a while. And they don't think it's going to do well, publicly. So in this case, you find this potential seller, you contact them, you get the house under contract for a certain price, you estimate what the repair value would be, you then tell different potential cash buyers, what that would be for the after repair value. And then you make a small spread. And between since you package the steel, and brought these two people, buyer and seller together. Now as I've been going through this process, I thought, Alright, if I just get some sort of platform like prop stream, Rei sift or the other ones, it's just going to be easy, I'll be able to quickly set up list on who are motivated sellers quickly find their phone numbers, their email their contact. And as you can imagine, this is actually very difficult. For one, all the tools that have been looking at are not perfect. And I think this makes sense. Because if you've been following this channel, you're aware that there's no perfect data source, right. So what makes real estate special is that the data is disparate, meaning that when there are real estate transactions that go on, it's recorded in a county, and there's no requirements county per county, on how to actually save this data down, do quality checks, etc. So what you have are these data aggregators, such as the MLS, who tried to take a lot of this information for buyers and sellers, when it comes to looking at historical things, as well as things that would make someone a motivated seller, like foreclosures if their absentee owner, etc. It's not really all in one place. And it may be really good. So say, for example, Rei SIFT, this is not true, this is an example, they may have the best data in California, when I look at a markets in New Jersey, a data quality might not be there. And that's just because of the disparity of the data, and not having enough manpower, I guess, for the quality checks. So overall, I have not found a perfect tool. But I am actually at least trying to jot down all the tools available, use some of them and and see for my area, which ones have some accurate data. And as I'm doing this, I'm looking at some of my own properties or friends as well so that I can quickly see and pinpoint anything that's wrong. And I'm going to be going over this in future videos. So number two, as first is getting the system that's going to get me list right, then the second part of trying to contact people from the this list has been overwhelmingly a headache. I thought they'd be skip tracing and pay for skip tracing easy. Get the phone number, get the email. Wow, I'm going to have a next video of why this is not as easy. I even tried to skip trace myself and the data has either come up completely wrong missing or some

things are not as accurate as I would have expected. So I think it's going to take a lot of understanding for my market, what skip tracing tools may be the best. And then what are some other resources I could use to do quality checks. So for example, one of my thoughts is maybe I use batch skip tracing, which is one of the skip tracing software's. And what I could do maybe is try to use Clearbit, which Clearbit is a tool that's able to append information like social media, URLs for a person, contact information, and just see if some things don't meet up. I have some more thoughts around that. But as I go through it, I'll share with you any pain points there, no one clear system, no one clear skip tracing. And also the whole idea of being able to write the contract. The information, there has been, again, very disparate. I understand that for different creators and different sites, they want to hold on to a lot of that information, because they want you to pay for courses, which makes complete sense I get it, yet, there's just not even enough free direction for me to know, okay, if I go pay for paste more of these course, how do I know that's gonna be beneficial for me and other market don't want to take the chance of paying 1000s for a course and then it ends up not working, right. So at least that type of research, I think could be beneficial. So I'm really looking throughout this process to document all of the tools that I researched pros and cons of each, which ones I ended up using, how I get them to talk to one another, as well as how to systematize everything. And I think this could really help just to have a hub for myself, have a knowledge share. And then by bringing the community, I can get a lot of insight from you all who might have a lot more experience in this space and getting the right data for it. So stay tuned, I'm going to be posting more about my journey in wholesaling, the pros, the cons and everything in between. This will be in a playlist, likely called wholesaling journey posted on Mondays so please subscribe if you haven't already. Thanks.