BiggerPockets

Do I Need Construction Skills To Wholesale Real Estate?

The answer to this question is NO! And Thank God for that! You personally do not need to know how to repair or rehab distressed real estate!

First of all, Real Estate Wholesalers NEVER are the ones fixing-up Ugly distressed properties, its not what we do as investors! Far from it! We leave that aspect or real estate investing to the "end-users", or to the Investor/Buyers that we sell our property too.

Real Estate Wholesalers never touch a hammer or a saw or any other tool! That's the "other guys" project to deal with, the Investor/Buyers problem to address, NOT YOURS! Wholesalers NEVER end-up owning any of the real estate that we put under contract with Motivated Sellers! So why would we want to fix anything?

It's true that a lot of the property's that Real Estate Wholesalers "put-under-contract" need a fair amount of rehab work. It's NEVER the wholesalers concern as to how or who is going to make the repairs. Again that's the "next guys" problem.

Now, It is advisable to familiarize yourself with "basic" construction terminology and "basic" remodeling practices. The reason for possessing some basic contracting knowledge is so that you can calculate the "repair cost" value to plug into your deal spreadsheet formula. The formula that tells the wholesaler whether or not he has a deal on his plate.


You DO NOT have to know how to actually do the needed rehab work on a contractors level! But, you should be able to at least "roughly estimate" the needed repairs. The value of the needed repairs is a VERY important factor of the "deal structuring" aspect of a wholesale deal!

But outside of some basic remodeling knowledge, and I said remodeling knowledge NOT remodeling hand-on skills, the real estate wholesaler is NEVER part of the rehabbing stage of a real estate deal. EVER!

I do however recommend to new wholesalers that have no construction knowledge or skills whatsoever, that they find a contractor who they can call-on when rehab-cost questions that they can not answer arise; even if you have to pay them a small fee to meet you at the property to discuss needed repairs to the property.

After a while, you will be able to do this yourself. But in the beginning of your wholesale investing career, a little unbiased advise from an established contractor will pay big you big dividends while protecting your interests.

Comments

• 

  Tyler S. — 7 months ago

  Im just scared of paying 50 dollars on properties that I might not even close on because the numbers in my head are 1 in 30 or 40 offers will get accepted. If you do the math thats a lot of money. I am a beginning investor and am having a hard time with this repair cost estimate thing