Hi, I'm just getting started at wholesaling. What should my fee be for locating properties? Is it based on a percentage model?
Nice to meet you @Steve Medina !
I'm a newer wholesaler myself and from what I've been reading / researching / told by other investors, it seems like the average is around $5,000, but the better the deal, the more you can ask for.
I would read as much as you can by @Wendell De Guzman and other successful and experienced wholesalers. I think he recommends building in higher wholesale fee than you think when starting out because your repairs and/or ARV may be off when you're just getting started and learning how to estimate.
Here's Wendell's podcast with the guys from BP: BP Podcast 065: Creative Investing, Mistakes, and Bulletproof Vests with Wendell De Guzman
Best of luck!
There is no standard fee or %. You price it for your end buyer at a price that makes it a good deal for them. How much you make depends on how much less you have the property under contract for.
A house in "AS IS" condition is worth $70k to the average investor. If you have it under contract for $60K you make $10K. If you have it under contract for $45K you make $25K. If you have it under contract for $68K you make $2k.
How much you make is dependent on how good a deal you have. Now you might choose to take a little lower fee to mover the property faster. A good deal should sell in a week or two.
The hard part as a wholesaler is knowing what another investor will pay for a deal. You might check out J Scott's books here on BP to help with that.
That makes sense. Thanks for your comments, I'll look into it!
Can someone give me a snapshot or example on what their wholesale fee would be for a multi-unit deal? Need an idea what to look for.
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