wholesaling vs Flipping

10 Replies

Capital aside. Which is easier, which is more profitable, which is more time consuming? Wholesaling or Flipping? Wholesaling. the entire process of finding deals, finding buyers and getting a quick cut in between. Doing alot of these. say 20 per year in at $7500 a piece= 150k or  Flipping, 3 flips profiting 50k each = 150k by way of finding deals, finding money, finding contractors and selling fast. 1.5 wholesale deals a month sounds fair and 1 new flip every four months sounds fair as well.

I think everyone will have their own opinion. Which is "easier" depends on if the person posting is a flipper or a wholesaler. I am neither, so since you stated as a premise "capital aside"... I will say the answer is... a dealership is easiest. Find good deals, Buy, and Sell, and on occasion (when it is "easy") just assign contracts. Run the dealership as a company, not in your name. If you have inventory that is hard to move, put in enough repairs to 'wholetail'. Just a thought.

@Chris Martin  Great adivce. Hybrid is the way to go. Wholesale some, flip some and hold some depending on situation.

I don't see wholesalers as investors at all.

Let the flaming begin

@Scott K. they're not investing their money per se, but its still a REI niche\strategy and it is somewhat "flipping" houses haha. but @Chris Martin  said it best. I'm sure a lot of investors wholesale some deals.

Originally posted by @Dev Lindo :

@Scott K. they're not investing their money per se, but its still a REI niche\strategy and it is somewhat "flipping" houses haha. but @Chris Martin  said it best. I'm sure a lot of investors wholesale some deals.

Well I don't consider agents to be investors either.  They are just middle men but not investors,

Now if they buy the house that's different

@Scott K.  ehh as a buy and hold investor. I wholesale to raise capital, just as I do flip. I can imagine some investors work as agents or property manage to do the same. But i guess i wouldnt call myself a "wholesaler". 

Originally posted by @Dev Lindo :

@Scott K. ehh as a buy and hold investor. I wholesale to raise capital, just as I do flip. I can imagine some investors work as agents or property manage to do the same. But i guess i wouldnt call myself a "wholesaler". 

yes so the wholesale deals are just you being the middle man.  Middle men are not investors.  Now your buy and hold properties are investments.  There is a huge difference between the two.

Originally posted by @Scott K. :
Originally posted by @Dev Lindo:

@Scott K. ehh as a buy and hold investor. I wholesale to raise capital, just as I do flip. I can imagine some investors work as agents or property manage to do the same. But i guess i wouldnt call myself a "wholesaler". 

yes so the wholesale deals are just you being the middle man.  Middle men are not investors.  Now your buy and hold properties are investments.  There is a huge difference between the two.

Why does the terminology matter?  

You can call me an investor, a businessman, a rehabber, a flipper, an ugly ******* or anything else you want.  It doesn't change what I do or how much money I make.

Originally posted by @J Scott:
Originally posted by @Scott K.:
Originally posted by @Dev Lindo:

@Scott K. ehh as a buy and hold investor. I wholesale to raise capital, just as I do flip. I can imagine some investors work as agents or property manage to do the same. But i guess i wouldnt call myself a "wholesaler". 

yes so the wholesale deals are just you being the middle man.  Middle men are not investors.  Now your buy and hold properties are investments.  There is a huge difference between the two.

Why does the terminology matter?  

You can call me an investor, a businessman, a rehabber, a flipper, an ugly ******* or anything else you want.  It doesn't change what I do or how much money I make.

I just have had terrible times with wholesalers here in Michigan.  They all come off as con men.  They never talk about back taxes, they lie about the situation about the property.

A real estate agent at least has guidelines he/she needs to follow.

I have had to call out the bad ones about the taxes and or liens on the property.  I am more than willing to deal with a good honest one.

@J Scott it doesn't matter how we all make money I just expect people to be honest.  Also most wholesalers are just broke people wanting to front as something they are not.

I knew I would get flamed for that but that's alright we all have the same goals.  Make money   

Hi @Scott K.   - I feel your pain.  I know there are a lot of people that claim to be wholesalers that really aren't, and it can feel like a big waste of time.  However, this is true of any industry.  There are a lot of realtors, insurance people, cable companies, auto repair shops, and and tech companies that don't deliver as they promise.  In my opinion, it really comes down to the individual or company, not the profession as a whole.

As someone who has both flipped houses and wholesaled good deals to other people, it makes me sad to see that some bad apples have turned some investors off to the idea of wholesaling entirely.  It is a service like any other, and I would say you just need to find the good people that do it well.

To the original topic - @Mike Mitchell , they are just very different tasks, and you can do well at either.  If you want to make wholesaling your full time business, be prepared to do a lot of networking, marketing, talking to sellers, analyzing deals, negotiating, getting turned down, following up with buyers, and focusing on a lot of volume and work.  It is highly people oriented, so only pursue wholesaling if you actually like people.  Otherwise, you will get very sick of it very quickly.  Also, always be honest about what you're doing, with everyone.

If you want to be a flipper, be prepared to analyze deals, work with contractors, oversee projects, negotiate with lenders and/or money partners, be very diligent at hitting budgets and timelines, be very careful with finances, and focus on knowing your market very well.  While you still need to be very good with people, as a flipper you need to be good at running projects with long- and short-term goals, and be able to change between the bird's eye view and the microscope quickly.  I'm sure those that have flipped more houses than I have could add to this as well. (:

My point is, you can do well with either, and rather than focusing on 'which will make me more money,' choose the work that fits your personal style better.  I believe that if you do that, you will make much more in the long run.  Good luck!

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