Wholesale MLS Property: Does It Work?
Can wholesale MLS property really work and be profitable or is it a useless and ridiculous waste of time and energy?
Many real estate investors may laugh at the idea of selling MLS properties wholesale and write it off, while spending immense resources searching for other types of discount deals or enduring the frustration of REO bidding wars. However, it always pays to do your own homework and make a decision when it comes to a real estate investment strategy…
2 Reasons Why Trading Homes Through MLS Makes Sense
1.Easy inventory source
Being so underrated by other investors makes the MLS a great option for finding business. Plus, it just couldn’t be easier; you don’t even have to search anymore. Set your criteria and automatically receive the latest listings on your new iPhone 5 or iPad mini, no matter where you are, from the beach to a Mediterranean cruise to skiing in the Alps. You don’t even have to spend time or money on marketing for them, while others are exhausted with all kinds of complex ad campaigns.
2. Real estate agents can be great employees
Searching for your local Real Estate Agent Multiple Listing Service is a great way to meet agents and develop relationships so that future investors can be the first to get deals before they go public. However, what is overlooked by many with all the hype about outsourcing today is that, in many ways, a real estate agent can essentially become a low-cost assistant. Instead of having to hire a small army of remote staff and train them, a good real estate agent can provide many of those same functions for free, from marketing to evaluating offers to acting as a personal receptionist and property manager, often for virtually free. .
How to make wholesale MLS properties work for you
It is true that many of the properties for sale in the MLS are overvalued or the spreads may be too small to make sense, but there are also golden nuggets if investors know how to look for them and create bigger spreads.
Undoubtedly the biggest complaint about homes listed on the MLS is real estate agent fees driving up prices and eating up profits, but this is exactly where savvy investors can get a leg up and even potentially sell these same homes for free. others who rejected them because they were originally in the MLS.
If you can get access to the back-end system and Realtor’s view of home listings, you can get a better idea of how motivated a seller is based on how much commission they are offering and what bonuses or concessions are being offered. Investors can use this as leverage and trading room.
Those who have real estate licenses can immediately use these real estate commissions to earn at least 3-6% profit, plus bonuses.
However, it’s also very easy to negotiate a real estate agent’s commission, especially in exchange for increased business or to pick up some of the work and simply have them act as a conduit for bids. Imagine a $1 million home for sale that offers a 10% commission. If the agent takes just 1%, that automatically leaves $90,000 on the table as potential profit from just one deal.