Starting to think rehabs are easier than wholesaling

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Starting to think rehabs are easier than wholesaling

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Member since 2008 · 19 posts · 0 votes

I got into REI in March and I've finally gotten to the point where I feel I can do transactions. Originally, I felt doing wholesales was the way to start out, but as I circle neighborhoods, talk to investors, sort through the homes I get from being on buyers lists -- it's much easier to find and do rehab.

I know and trust two project management services who charge a flat fee to manage rehabs and getting myself a rehab won't require 100+ calls, $2500+ in direct mail, circling neighborhoods and countless bandit signs. Am I missing something in my thinking here? I may have to partner for some of the cash, but I feel I can do a rehab right away instead of 3 months of expenses looking for a wholesale deal.

My question: am I not searching for wholesale properties correctly, or should I just go ahead and do a rehab?

Thanks,
Vernon.

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  • Account Closed
    Real Estate Investor · Chicago, IL · Member since 2008 · 1k+ posts · 218 votes
    19y

    Vernon,

    Ok, well I see your location is Central Florida, could what you are seeing be more related to the local market? I know areas of Florida are seeing a downturn in pricing.

    I can't speak of where you are at, because I honestly do not know, but it might be that the rehabs you find are available because the experienced investors do not think it is a deal anymore?

    The gamble with a rehab is that you will sell it for a certain price when you complete the work. Well, can you? Are you sure?

    If you can rent it out and cover your costs, then by all means I think that is the way to go.

    Just my $.02 worth.

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  • Richard Warren
    Real Estate Investor · Las Vegas, NV · Member since 2008 · 1k+ posts · 447 votes
    19y

    Before you jump into rehabs be sure to do your research.. Many newbies jump into rehab and lose their shirt. They underestimate the work needed, the time it will take, and the cost of repairs. The key in rehab is to buy at the right price and leave plenty of room for error.

    8)

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  • Jon C.
    Real Estate Investor · Phoenix, AZ · Member since 2008 · 74 posts · 14 votes
    19y

    I don't follow. I can't see how rehabs are easier than wholesales. The problem you seem to be having is finding properties. How is that changing with rehabs? You still gotta find the same deals. The only difference is that instead of passing the work onto someone else, you want to take it on yourself. I don't see how thats easier.

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  • Ken Hicks
    Boonies, PA · Member since 2008 · 333 posts · 15 votes
    19y

    Nothing in this Biz is easy. rentals, wholesalers, rehabbing, ect. Wholesalers do a lot of leg work. either way you need to buy properties at wholesale. Not sure what your position is but I would live in a home well you can remodel it. This is hard. I wouldn't bail on wholesaling just yet. You never know when some one will give you a call to take this home off their hands. You might not have time to rehab it but maybe you do know of other guys that are rehabbing now. sign the contract then assign it to other investors. Your team is the most important thing. If your on a buyers list for a wholesaler be warned that most of the time when that deal gets to your desk it already went past a few other guys. Wholesalers have a list of guys that will buy properties with real cash, and if it's a deal they bought it yesterday. If they dont' want it then the so called deal get passed to you. Hope this helps some. Just don't give up and do your homework.

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    OP
    Member since 2008 · 19 posts · 0 votes
    19y

    I'm finding the rehabs easier because it's much easier to get a list of wholesale properties from the countless other investors in the area. They've done the legwork and are looking to make money from the assignment.

    But, I just read an earlier post and it seems this falls into the 80/20 rule. I'm doing time-intensive activities (driving around neighborhoods) instead of using MLS searches and fax. I will also put some ads in the paper and see what turns up.

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  • Vicky Blacknall
    Real Estate Investor · Owasso, OK · Member since 2008 · 21 posts · 2 votes
    19y

    RE-Driven,

    Have you checked into county tax deed properties since you like rehabbing?

    Vicky

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  • N/A N/A
    Member since 2008 · 30 posts · 0 votes
    19y

    I can see why the question was posed. I think it depends on your personality. I have my partners that are willing to do the rehab because they dont have the time to look for the deals. The rehab work is what they are willing to put their efforts into.

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