Hello. Im brand new in Real Estate and id like to get started wholesaling properties. but i don't know where to start. I was duped into paying for a seminar and after the fact i found this site. Now i see from reading a few reviews that i really dont need that seminar just the information. Of course its too late to get my $$$ back now but ill just chalk it up to a learning experience. I believe i understand the concept i just dont know how to get started and would like a little help if anyone is willing. thanking you in advance
Wholesaling is simple on the surface:
1. Find an undervalued property for whatever reason
2. Get the property under contract
3. Sell/Assign the contract to another person (most likely a flipper)
4. Get paid at closing
Wholesaling is not what I would call a rookie level skill. It requires the ability to sell, manage a deal, hustle (in the go quickly sense), local knowledge of the neighborhoods, evaluate repair costs CORRECTLY and not get too greedy all at the same time.
You need to have a relationship with as many flippers and "fix and hold" folks as possible. You need to have enough cash to lock these deals up and occasionally eat a $500 earnest money payment from a deal that didn't end up closing for whatever reason. I mentioned not getting too greedy, right? Your seminar probably mentioned putting $10 bucks down on 10 deals then closing 1 or 2 of them for a 10k payout, right?
Being a good wholesaler is just like being a good realtor. Honestly I'd go get your license if you really want to be in the REI business. If you can hustle enough to be a good wholesaler, you can do the same thing as a realtor. And as a realtor no one questions your ethics :)
Alternatively go get your home inspectors license. This will teach you more about evaluating houses, their necessary/optional repairs and associated costs than just about anything else there is. A BP member, @J Scott has written a good book on rehab. It isn't the golden tablet that will turn you into a perfect wholesaler, but it is a good start. Plus home inspectors make about $500/inspection.
The final key is marketing. Serve your deals up on a silver plater. Find a place with an ARV of 100k. Grab 3 estimates from local contractors for repairs, lets say ~25k.
70% ARV - repairs puts the cost to the flipper at 45k. Get it under contract for less than that, take your cut and go home happy. You bring deals like that to your buyers list and they will make you rich. Obviously you need to go out and find these deals which isn't the easiest thing in the world... back to work ethic/hustle :)
We have a 3-video series that explains the wholesaling process from A to Z...
Here's the first video (15 minutes) so you can preview it! If you want the other 2 (+ our sample contracts) just send me a COLLEAGUE REQUEST here in BiggerPockets (and include your email address):
Listen to podcast #37
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