Wholesaling in Phoenix

[xlregroup]

Is anyone wholesaling in the Phoenix Valley Successfully? I'm looking to start wholesaling in the Phoenix Valley and i was wondering because I know that there are alot of foreclosures here.

Thanks
XL Investments

[Gold River]

Hi,

    This is kind of a loaded question? For me as an investor I like buying wholesale properties when I can find them because I don't have to wait for a bank approval for a REO and I don't have to wait to close an escrow.

On the other hand the wholesalers working here now never seem to have properties in the area's I want to buy in!

There are 7 or 8 fairly well known larger wholesalers here in Phoenix (Maricopa County Arizona) of these the couple of largest turn close to 1000 properties a year.

Now for the tough part, of all the properties we see, all need fairly extensive work, most were foreclosures that ended up being sold at auction and are in very rough shape, so one person's idea of a remodel are not exactly the same as another's and those cost's can widely vary.

Right now it is easier to make offers on REO's than to find the right property in the right condition with the right rehab cost's and in the right location and with the right FMV to make all the numbers work.

I was just discussing with a fellow investor last week the pro's and con's of wholesaling, buying wholesales and whether it really works and you could really turn over properties to other investors. I'm guessing right now most of these existing wholesalers are actually selling some 50% of there yearly inventory to end users, so is that really wholesale or just retailing at a super discounted price?

There are an abundent supply of properties here, we have rentals but our primary strategy is Fix & Flip so we have to buy them and the numbers have to work to allow us to cover all our cost's and still make a profit.

We are actually buying properties in our locations lower than the last wholesale property we saw as a REO, and the biggest judgement the wholesalers have to make is "What are the Rehab cost's" and can I sell this property and still let the buyer end up making money when all is said and done.

There are a lot of choices here right now and to make it rougher on new guys these existing wholesalers have hard money lenders available for their properties and completely set up just waiting for buyer and 20% down.

We will have bought almost 20 properties here this year if we stay on our expected estimate to fix & flip, but I would say we will have bought less than 50% through wholesalers.

If you run across anything real good shoot me an email and good is less than 60% LTV and in the $25k to $110k purchase price so we retail below $200k as this is where the majority of Phoenix area buyer's are.

We buy in the southeast area.

Good luck to you!

                            GR

[xlregroup]

Thanks for the insight GR.

[RonH]

GoldRiver,

Are you a member of AZREIA?
Can I add you to my buyers list?
If so can you email me your strategy and purchasing criteria?

[Gold River]

Hi,

    Yes, I have known Alan since 2003.

If you find something interesting shoot me an email.

We are doing a lot of fix and flip so we are buying in the $25k to about $110k range and no more than 55% of FMV.

Single family homes 3 bedroom minimum with 1 3/4 baths, two car garage and pools are ok. No war zones and prefer better area's of Chandler, Gilbert, Tempe, Mesa, Apache Junction and will look at some properties west of the 10 & 60 in south Phoenix.

I have a huge network here but have been cherry picking good deals.

                      GR

[RonH]

Wow 55% FMV.  That makes it pretty damn hard.  West of I10?  I'm assuming  you mean laven seeig that a lot of that is a war zone.  Are you going to need analytics of the home?  Or will you do that?  Are you guys all-cash buyers or financing your flips?

[RonH]

GR,

How fast can you secure financing after deciding you want said wholesale property?

[Gold River]

Hi,

    Don't get to excited about the Phoenix or Arizona market, I get hundreds of leads on properties every day.

We are strictly fix & flipping in this market and I invest in Phoenix and Tucson in Arizona.

I am buying between 1 and 2 properties a month between Arizona and Nevada.

I have more choices today than in any other time in history and there are a lot of investors pushing properties.

When I buy I have the ability to close in 24 to 48 hours all cash, but a property really has to catch my interest and in this market there is a lot more choice to cherry pick from. I said in my posting I would like to be below 55%, but I am working on a property right now I got for 30 cents on a dollar.

I have absolutely no love for any property, it is simple a means to an end.

There is currently 51,000 residential properties in the Maricopa County MLS system as of this moment, as I just checked the system.

Good luck to you.


                        GR

[RonH]

Out of the 100's you get per day what percentage are quality leads?