Investor · Sarasota, FL · Member since 2008 · 18k+ posts · 17k+ votes
10y
Wholesaling is simply arbitrage... buying for one price and selling for a higher price. Anything can be arbitraged -- a distressed house, a rehabbed house, a pair of socks, etc.
Investor · Chicago, IL · Member since 2013 · 2k+ posts · 1k+ votes
10y
You find a buyer willing to pay for a rehabbed house at a fair price not at a dirt cheap price. Landlords and buyers of turnkey properties love to buy properties that are already rehabbed. If you can buy these properties from motivated rehabbers at say 85% of market value and then find a turnkey buyer at 90% of market value, you make 5% of the sales price as your wholesale fee.
Investor · Sarasota, FL · Member since 2008 · 18k+ posts · 17k+ votes
10y
Wholesaling is simply arbitrage... buying for one price and selling for a higher price. Anything can be arbitraged -- a distressed house, a rehabbed house, a pair of socks, etc.
Buffalo, NY · Member since 2015 · 252 posts · 109 votes
10y
I am currently thinking about the same potential thing. I just got back from an appointment with one of the pre-foreclosure candidates I mailed to last week. They're thinking about selling, but don't want to "give it away" and I can see why... The house is very updated and beautiful looking. Very evident that the husband did a lot of nice work since they've lived there the last 40 years... I'm also wondering what kind of possibilities there are for the house, if anything...
Real Estate Agent · tampa, Florida (FL) · Member since 2013 · 206 posts · 96 votes
10y
I wish i could find a house that is already rehabbed but the owner needs to sell fast, i would either flip it to a landlord or a to an end buyer since it's ready to move in. That's much easier than dealing with estimating repairs
Real Estate Agent · Los Angeles, CA · Member since 2015 · 201 posts · 82 votes
10y
If only there was some service or profession that took houses with motivated sellers and sold them to retail buyers for top dollar and charged a fee, creating a win-win for everyone. Hmmm...
Broker · Logan, UT · Member since 2013 · 1k+ posts · 1k+ votes
10y
Think about what the term "wholesale" means. Generally, there's some sort of bulk quantity associated with it. But in general, in means creating value by sourcing a product for sale to others to retail.
If you are selling to an end buyer, you are not wholesaling, you are retailing. As @Eric Dowling suggests (rather amusingly), this requires a license. If you are selling to a landlord, you are still selling to an end user and therefore are not technically wholesaling either. But in this scenario, there's a lot of crossover between flipping and holding among investors so your marketing and client profile might look similar.
That being said, as @J Scott suggests, if there is a value proposition there, it makes no difference what the physical condition of the house is. What matters is if there's room for another buyer to come in and profit from it at your selling price. This happens frequently with estates and divorces, for example.
We just saw a brand new completed home wholesaled for 85% of FMV. The wholesale buyer had a retail buyer lined up and was able to make 10% on the deal because he was in a position to put up the cash fast and had low costs of selling.
If there's not much equity, look for high LTV seller financing. At 100% seller financing, just buy the property. If the property doesn't make sense with 100% seller financing, you don't have much of a deal.