I just started learning about wholesaling. Where do I start?
Should I open a LLC or a C-Corp?
Where is a good place to find investors?
How do I know I’m giving the investor a good offer?
At the same time give the seller a good offer?
When doing my numbers if I have a 5 acres property but the house is only 1,000sqft how can I come up with the ARV?
I really want to do this full time to help my family get out from the hole we are in.
Thank you in advance
I would check out Brandon's guide.
As for your questions you do not really need one until you are really makes some numbers. Though you could still start one. Offers for investors will be dependent on your market research. You want to get the deal at a good enough price to wholesale that you can leave enough for the investor to remodel and make their profit.
There are many ways to do it but if you can get it say 60 cents on the dollar, and wholesale at 70-80 cents. Some go with the 70% or 75% rule of the after-repair value minus the rehab cost, and that would be the price you get the home. This gives you a 30-35% margin to decide what to sell it to an investor.
As for the 5 acres, you would have to consider the value of the land. I am not an expert in this field.
Keep educating yourself so you know these things. Wholesaling is a great path but don't try and get a house under contract until you have knowledge on the process. There are plenty of free podcasts and youtube channels. Wholesale Inc is a great place to start and Real Estate Disruptors for more advanced information. Plenty of others out there. Biggerpockets is generally pretty negative on wholsaling so you might start to see some negative comments. Ignore them and keep learning.
@Alec York you will find quite a few on here that have less than positive things to say about wholesalers. I on the other hand believe there is a space for wholesaling if you do it right. The biggest issue is that wholesalers tie up properties with 0 intention on closing and most don’t have the funds to actually do the deal begin with. So a couple thoughts.
You need to first under stand what goes into a rehab and be able to calculate a pretty close scope of work otherwise you'll struggle flipping to investors. Second, you need to be an expert with ARV's in the market your going to work. If you can master those two things your off to a great start.
Lastly, don’t get greedy!!!!! If you wholesale, don’t ever believe you deserve as much profit as the flipper who’s actually taking the risk. Make your slice of the profit and leave plenty on the bone for the investor.
Be honest to the homeowner as to what your doing as I’ve seen many go bad when the wholesaler has been less than honest. And, as soon as you get one bad rap for being a slime ball with investors, they will spread that quickly.
My real advice, if you want to do something good for your family, learn real estate and become a real investor!! That’s how you build wealth. Very few wholesalers will build long term wealth for their family.
Good luck to you
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Originally posted by @Todd Pultz:@Alec York you will find quite a few on here that have less than positive things to say about wholesalers. I on the other hand believe there is a space for wholesaling if you do it right. The biggest issue is that wholesalers tie up properties with 0 intention on closing and most don’t have the funds to actually do the deal begin with. So a couple thoughts.
You need to first under stand what goes into a rehab and be able to calculate a pretty close scope of work otherwise you'll struggle flipping to investors. Second, you need to be an expert with ARV's in the market your going to work. If you can master those two things your off to a great start.
Lastly, don’t get greedy!!!!! If you wholesale, don’t ever believe you deserve as much profit as the flipper who’s actually taking the risk. Make your slice of the profit and leave plenty on the bone for the investor.
Be honest to the homeowner as to what your doing as I’ve seen many go bad when the wholesaler has been less than honest. And, as soon as you get one bad rap for being a slime ball with investors, they will spread that quickly.
My real advice, if you want to do something good for your family, learn real estate and become a real investor!! That’s how you build wealth. Very few wholesalers will build long term wealth for their family.
Good luck to you
that and simply take a pre license course so you at least learn the vocabulary and interact with those of a like mind.. wholesaling is by far the most difficult thing to do in real estate to make money.. and to really make money at it.. its like any other business you need start up capital. its NOT a no money business.. flipping contracts with small deposits seems like no money .. but to get the leads and close the deals you need money to live on.. you need marketing money and so on and so forth.. your really acting as a real estate agent just unlicnesed.. so wont go into the legalities of it. but as someone who has owned numerous brokerages over the years and had hundreds of agents come and go working for us.. First thing you tell a new agent is you need 1 year of living expenses in the bank and you need marketing money.. With those two things.. then it just comes down to how persistent you are can you self start.. do you have ANY sales chops.. etc etc.
If everyone who says they are a wholesaler or wants to wholesale in a given market.. there would simply be not enough inventory to even remotely go around.. wholesale houses are a tiny fraction of the market.. compared to agents or investors who actually buy they can look at the whole market and work with that.. wholesalers are GENERALLY only looking for that beat up screaming deal.. So drive down a block maybe one potential home in 50.. but 49 of those could be potential listings. ????
