What kind of annual profits can one expect to make in wholesaling?

Question

I know there are a wide range of variables that will determine your annual income (location, full-time or part-time, experience, etc.) as a wholesaler, but how big is that range? Could one realistically expect to make $60K in their first year? How about $100K? And how much more can you expect to make the longer you're involved in this business?

It seems like most people who wholesale use it to jump start their investing careers, but I haven't heard of many people who do this for a long time. Is that attributed to burnout, lack of consistent cash, or what?

Stephen Moore · Answer

i know this is a old post but chris cho whats your main focus and how'd u end up making 6 figures your 1st year?

Chris T. · Answer

I also think that wholesaling should be the foundation of any and all other Real Estate investment strategies because it teaches you to find good deals on your own instead of relying on someone else to find deals for you.  I don't think you should ever stop wholesaling as long as you are investing in Real Estate.

Chris T. · Answer

I just started wholesaling this year and since July I'm averaging 1.5 deals per month.  That average is and will continue to increase as my knowledge, experience, capital and network increases.  I'm going to focus more on how many deals I do per month instead of how much money I want to make.  Once you actually dive in and start wholesaling the learning curve thrusts itself upon you and you are forced to learn or die!  In the process of surviving you will learn to make more money.

Sage Jankowitz · Answer

Thanks Chris! I really like that. I think it's important to put your chips out there and let them fall where they may. If you screw up, you learned something and you're a better investor as a result. If you make the right move, you've learned how to be more efficient and you can repeat again and again.

Michael P. · Answer

If it were only that easy.

I would love to just be a wholesaler.  Life would have little stress...that is of course if it were easy.

I have only wholesaled 3 times in my career as I kept most properties to rehab.  On occasion I would buy way too many houses in a short span and decide to wholesale one.  I made 2k 9.3k and 24k.  Why waste your time and add stress to your life if you can make 24k.  I have tried to wholesale other properties I have purchased and no one wanted them so I was forced to rehab them myself.  Some deals you just get lucky on that have huge spreads.  Some are marginal.

To fully answer your question I would say it is possible to make a full time income doing wholesales.  60k-100k would definitely be possible if you had enough deals passing through your hands.  You might on occasion hit a home run like I did but I wouldn't count on it happening too often.

There was a company here in Dallas that came out of no where and took over the wholesaling by storm.  They were getting tons of houses under contract and had the cash to buy all of them.  I guess they had huge backers.  They also would sell the houses and finance them.  It seemed to me that they had a great set up going and would often outbid me on houses.  As you can imagine I hated them.  I have no idea if they are still around as I am no longer on their email list.  They probably made over a million a year wholesaling if I had to guess.  They somehow had an amazing buyers list.  Their buyers would pay more than what the house was listed on MLS for.  I could never figure it out.  It must have been that they offered financing.

Sage Jankowitz · Answer

If I got into the wholesaling business I would assume a lot of stress, long days, and non-stop work. But that's what I'm prepared for. I've done the crazy, non-stop work thing in the film industry and I thrive off of it, I just want to make sure that there's the potential to make some big bucks here.

I would ideally like to get the wholesaling thing going in full swing and after some time, begin to take my profits and put them into rehab projects while continuing the wholesaling on the side. Does this sounds doable?

In terms of seller financing, I suppose you could only make that work if you had plenty of cash on hand?

Chris Cho · Answer

btw, there are times when I'm not working for 5-6 months. so it really depends. I can make $0 if i don't look for any deals. I guess you get what you ask for.

Set you limit and go for it. It doesn't matter how much other wholeasalers make.

Chris Cho · Answer

I did six figures my first year. And in January, soon as  I come back from Korea I expect to flip two properties for 75k. That's not a bad start on January.

Sage Jankowitz · Answer

Hi Sierrah,

Please tell me more about any resources that you think might help. I'm all ears!

Sage Jankowitz · Answer

Wow Chris, congrats! A couple quick questions if you don't mind:

1. How many deals did you complete in the first year and what were your typical fees?

2. How consistent did they come? Did it take a couple of months to get things going?

3. What kind of neighborhoods were you working in?

4. Did you create a business plan going in?