February 23, 2024

Bench Rest Bags

Designing Homes With Heart

To Wholesale Or Not to Wholesale Real Estate?

I think anyone getting started in real estate should consider wholesaling first. Why do you say that? Because it requires no credit, little risk, and very little to no cash at all to get started. Now that’s a business opportunity. Lots of money has been and will continue to be made by flipping a couple sheets of paper and a simple agreement. “The question is will you be a part of it?” That’s your choice, but I would strongly recommend it if you are wanted to get into the real estate game with little to no experience. Even if you have lots of cash and credit it’s still a smart move. I would recommend wholesaling 10 or so deals before buying your first piece of real estate. This will give you the chance to learn your market and say hey that was a good deal because the investor took it, or it wasn’t because he didn’t.

Wholesale deals come in many forms such as lease options, owner finance, and 30{13624d55b67f4b161de617d2e9d293368a3a357ee2b9d3c0f7245ef1c05927df} or more equity deals, but for the purpose of this article and to keep it simple we are going to use a sample 30{13624d55b67f4b161de617d2e9d293368a3a357ee2b9d3c0f7245ef1c05927df} or more equity deal. Ok, say you find a sweet deal in a middle class neighborhood that’s worth $100,000 fixed up, also known as after repair value, or fair market value depending on where you live. This particular house is owned free and clear and needs $10,000 in repairs. As a wholesaler you would have to get the house for $100,000×70{13624d55b67f4b161de617d2e9d293368a3a357ee2b9d3c0f7245ef1c05927df} or less minus repairs minus what you want to make on the deal. But for the purpose of this article we will use the 70{13624d55b67f4b161de617d2e9d293368a3a357ee2b9d3c0f7245ef1c05927df} variable because that’s what most investors are paying right now.

Just as an example say you as a wholesaler want to make $10,000 on this deal. You would have to get the house under contract for $50,000 and assign it to another investor for $60,000 making you as the wholesaler a $10,000 profit! Pretty good for no cash or credit hugh? You bet it is! Or if you have cash or access to cash you could double close. Which means you would close with the seller and then close with your end buyer in the same day. More on that later. Well go out there and do some deals, make some cash, and let me know how you are doing. Remember keep it simple and make things happen!