First Wholesale Deal

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First Wholesale Deal

Account Closed
Wholesaler · Huntersville, NC · Member since 2015 · 39 posts · 21 votes

Hi Guys ~ 

I have a property under contract, that will be my first wholesale deal, barring any disasters. 

The house is an extreme hoarder house. The heirs inherited the property. One of the siblings had lived in it for years and filled it up to knee level in junk. He is no longer living there and it is now vacant. According to the owner, the city threatened to condemn it, but they have not moved to do so as of yet. It is a 2 Bedroom 1 Bath, with 1450 Square Feet of Living Area. Property sits on 0.52 Acre. 

I got the property under contract at what I believe is a good price. It's just under the tax assessed Land Value. 

I am meeting with potential Buyers this week. I want to make sure I market the property at a good price, so both my Buyer and I will walk away with a great deal. 

Here are the numbers so far:

ARV = 120,000

This is based on comps for 3 Br properties sold within past year, within 0.5 miles. The home is in the city's "Historic District". I would assume buyer would make it into 3 and at least 1.5 bath, given the size of the property. If it was kept as a two bedroom ARV would only be about 80,000.


Purchase Price: $11,500 . Contract signed with Seller. $10 Due Diligence, 30 day period. $10 EMD.

Rehab Estimate: $50,000 . (This is a very rough estimate for a full rehab. For a 1450 square foot house, I think a lot can be done for 50K.)

Asking Price: 34,000 (ARV 120,000 x .70 = 84,000 - Rehab 50,000 = 34,000 )

Desired Wholesale Fee/Profit: 22,500. (Selling Price 34000 - Purchase Price $11,500 = $22,500 )

Is this a good asking price? Buyer should stand to profit at least 25,000 for the Flip. 

View report

*This link comes directly from our calculators, based on information input by the member who posted.

2Reply
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Most Popular Reply

Nathan Morgan
Flipper/Rehabber · Beverly Hills, CA · Member since 2019 · 6 posts · 11 votes
6y

@Oren Markowitz congrats on your deal my brotha don’t feed in to people that try to down you. Keep it going and continue your success man!

8Reply
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  • John Thedford
    Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes
    6y

    You found a sucker with $10 EMD and 30 day inspection. Can you afford to lose $10?

    5Reply
  • Account Closed
    OP
    Wholesaler · Huntersville, NC · Member since 2015 · 39 posts · 21 votes
    6y
    Originally posted by @John Thedford:

    You found a sucker with $10 EMD and 30 day inspection. Can you afford to lose $10?

    John, it seems like you have an issue with my EMD. What would you have put down?

    0Reply
  • John Thedford
    Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes
    6y
    Originally posted by @Account Closed:
    Originally posted by @John Thedford:

    You found a sucker with $10 EMD and 30 day inspection. Can you afford to lose $10?

    John, it seems like you have an issue with my EMD. What would you have put down?

    I don't scam people. If I represent myself as a buyer I AM A BUYER. 

    1Reply
  • Account Closed
    OP
    Wholesaler · Huntersville, NC · Member since 2015 · 39 posts · 21 votes
    6y
    Originally posted by @John Thedford:
    Originally posted by @Account Closed:
    Originally posted by @John Thedford:

    You found a sucker with $10 EMD and 30 day inspection. Can you afford to lose $10?

    John, it seems like you have an issue with my EMD. What would you have put down?

    I don't scam people. If I represent myself as a buyer I AM A BUYER. 

     I admire your immaculate Integrity, John.

    So what I hear you saying is you feel that all wholesaling is a scam. 

    When I met with the seller, I explained more than once, that I would most likely be assigning the contract to another buyer. He didn't seem to mind. Can you imagine that?

    2Reply
  • John Thedford
    Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes
    6y
    Originally posted by @Account Closed:
    Originally posted by @John Thedford:
    Originally posted by @Account Closed:
    Originally posted by @John Thedford:

    You found a sucker with $10 EMD and 30 day inspection. Can you afford to lose $10?

    John, it seems like you have an issue with my EMD. What would you have put down?

    I don't scam people. If I represent myself as a buyer I AM A BUYER. 

     I admire your immaculate Integrity, John.

    So what I hear you saying is you feel that all wholesaling is a scam. 

    When I met with the seller, I explained more than once, that I would most likely be assigning the contract to another buyer. He didn't seem to mind. Can you imagine that.

    Integrity! Look it up. If you cannot find a buyer do you scam your way out of the contract with BS clauses? If so...I feel sorry for anyone that trusts you. 

    0Reply
  • Account Closed
    OP
    Wholesaler · Huntersville, NC · Member since 2015 · 39 posts · 21 votes
    6y

    I don't scam my way out of anything. Do you spend your free time trolling  Wholesale forums, spewing your venom and baseless accusations?

    5Reply
  • John Thedford
    Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes
    6y

    30 day due diligence? $10 EMD? No need to try and convince me of your sincerity as a buyer LOL.

    No venom! Facts!

    0Reply
  • Account Closed
    OP
    Wholesaler · Huntersville, NC · Member since 2015 · 39 posts · 21 votes
    6y
    Originally posted by @John Thedford:

    30 day due diligence? $10 EMD? No need to try and convince me of your sincerity as a buyer LOL.

    No venom! Facts!

    What facts are you referring to??

    As I stated prior, and clearly you have chosen to ignore due to your blind bias, I have not tried to convince the Seller that I am the Buyer, and have stated verbally multiple times that I may be assigning the contract OR buying myself. I also pointed to our contract where it stated this. So how am I being a scammer again? Oh and please show me the rule book on what period of due diligence I need to offer and how much of an EMD to place.

    1Reply
  • John Thedford
    Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes
    6y

    LOL typical MYTHOMANIA unlicensed broker propaganda! You suckered the seller. Sign a contract to sell YOUR house on those terms (if you even own one). No need to try and convince me of your "integrity". 

    My 1K says you victimize this seller.

    0Reply
  • Account Closed
    OP
    Wholesaler · Huntersville, NC · Member since 2015 · 39 posts · 21 votes
    6y
    Originally posted by @John Thedford:

    LOL typical MYTHOMANIA unlicensed broker propaganda! You suckered the seller. Sign a contract to sell YOUR house on those terms (if you even own one). No need to try and convince me of your "integrity". 

    My 1K says you victimize this seller.

    The only victims here are myself for having to read your self-righteous babble and the other members on here who are wasting their time reading a post where no information of value was offered, only venomous trite fodder by a self-appointed standard bearer of integrity. 

    3Reply
  • John Thedford
    Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes
    6y
    Originally posted by @Account Closed:
    Originally posted by @John Thedford:

    LOL typical MYTHOMANIA unlicensed broker propaganda! You suckered the seller. Sign a contract to sell YOUR house on those terms (if you even own one). No need to try and convince me of your "integrity". 

    My 1K says you victimize this seller.

    The only victims here are myself for having to read your self-righteous babble and the other members on here who are wasting their time reading a post where no information of value was offered, only venomous trite fodder by a self-appointed standard bearer of integrity. 

     There IS value...education for those that think unlicensed brokers provide value. Education to help new readers see through games and not become victims themselves. 

    0Reply
  • Account Closed
    OP
    Wholesaler · Huntersville, NC · Member since 2015 · 39 posts · 21 votes
    6y
    Originally posted by @John Thedford:
    Originally posted by @Account Closed:
    Originally posted by @John Thedford:

    LOL typical MYTHOMANIA unlicensed broker propaganda! You suckered the seller. Sign a contract to sell YOUR house on those terms (if you even own one). No need to try and convince me of your "integrity". 

    My 1K says you victimize this seller.

    The only victims here are myself for having to read your self-righteous babble and the other members on here who are wasting their time reading a post where no information of value was offered, only venomous trite fodder by a self-appointed standard bearer of integrity. 

     There IS value...education for those that think unlicensed brokers provide value. Education to help new readers see through games and not become victims themselves. 

     You seem to have the impression that only you can provide an education and the "facts". I am still waiting for you to show me where the facts may be found, that only a registered and licensed broker can buy/sell/assign a property in an ethical manner. and provide "value". That is such sanctimonious, self-serving horsepoop. New readers would be better served without your drivel. 

    1Reply
  • John Thedford
    Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes
    6y
    Originally posted by @Account Closed:
    Originally posted by @John Thedford:
    Originally posted by @Account Closed:
    Originally posted by @John Thedford:

    LOL typical MYTHOMANIA unlicensed broker propaganda! You suckered the seller. Sign a contract to sell YOUR house on those terms (if you even own one). No need to try and convince me of your "integrity". 

    My 1K says you victimize this seller.

    The only victims here are myself for having to read your self-righteous babble and the other members on here who are wasting their time reading a post where no information of value was offered, only venomous trite fodder by a self-appointed standard bearer of integrity. 

     There IS value...education for those that think unlicensed brokers provide value. Education to help new readers see through games and not become victims themselves. 

     You seem to have the impression that only you can provide an education and the "facts". I am still waiting for you to show me where the facts may be found, that only a registered and licensed broker can buy/sell a property in an ethical manner. and provide "value". That is such sanctimonious, self-serving horsepoop. New readers would be better served without your drivel. 

    You aren't "buying" anything. More unlicensed broker propaganda. Skirting laws to broker real estate, stealing equity, and misleading sellers are the typical M/O of unlicensed brokers. What value and service are you providing except to yourself? None!

    0Reply
  • Account Closed
    OP
    Wholesaler · Huntersville, NC · Member since 2015 · 39 posts · 21 votes
    6y

    Get over yourself. Show me what laws I am skirting. Stop putting out false statements and convincing yourself you're helping people. I haven't mislead anyone, and don't care to keep defending myself against more and repeated false accusations. The value I am offering in my particular deal is preventing a distressed owner from having their house demolished for unsafe and unlivable conditions. 

    But I don't need to prove that to you. 

    0Reply
  • John Thedford
    Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes
    6y
    Originally posted by @Account Closed:

    Get over yourself. Show me what laws I am skirting. Stop putting out false statements and convincing yourself you're helping people. I haven't mislead anyone, and don't care to keep defending myself against more and repeated false accusations. The value I am offering in my particular deal is preventing a distressed owner from having their house demolished for unsafe and unlivable conditions. 

    But I don't need to prove that to you. 

    All for ONLY $22,500. Now THAT is a service! As I said...victimizing sellers. 

    0Reply
  • Account Closed
    OP
    Wholesaler · Huntersville, NC · Member since 2015 · 39 posts · 21 votes
    6y
    Originally posted by @John Thedford:
    Originally posted by @Account Closed:

    Get over yourself. Show me what laws I am skirting. Stop putting out false statements and convincing yourself you're helping people. I haven't mislead anyone, and don't care to keep defending myself against more and repeated false accusations. The value I am offering in my particular deal is preventing a distressed owner from having their house demolished for unsafe and unlivable conditions. 

    But I don't need to prove that to you. 

    All for ONLY $22,500. Now THAT is a service! As I said...victimizing sellers. 

    It seems that now you have an issue with my assignment fee. And I'm sure you work for FREE right??  You have never made any profit off your borrowers of hard money right?? Get over yourself. 

    0Reply
  • John Thedford
    Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes
    6y
    Originally posted by @Account Closed:
    Originally posted by @John Thedford:
    Originally posted by @Account Closed:

    Get over yourself. Show me what laws I am skirting. Stop putting out false statements and convincing yourself you're helping people. I haven't mislead anyone, and don't care to keep defending myself against more and repeated false accusations. The value I am offering in my particular deal is preventing a distressed owner from having their house demolished for unsafe and unlivable conditions. 

    But I don't need to prove that to you. 

    All for ONLY $22,500. Now THAT is a service! As I said...victimizing sellers. 

    It seems that now you have an issue with my assignment fee. And I'm sure you work for FREE right??  You have never made any profit off your borrowers of hard money right?? Get over yourself. 

     You can't debate facts!

    0Reply
  • Account Closed
    OP
    Wholesaler · Huntersville, NC · Member since 2015 · 39 posts · 21 votes
    6y
    0Reply
  • Nathan Morgan
    Flipper/Rehabber · Beverly Hills, CA · Member since 2019 · 6 posts · 11 votes
    6y

    @Oren Markowitz congrats on your deal my brotha don’t feed in to people that try to down you. Keep it going and continue your success man!

    8Reply
  • Glidden Rivera
    Rental Property Investor · Orlando, FL · Member since 2019 · 105 posts · 71 votes
    6y

    @John Thedford

    I don’t wholesale but I think you are being very harsh. The gentleman found a deal, and he is assigning his contract for a fee. I agree that there are many scum bags that wholesale, but you can’t categorize all people into that category. Some people need it as means to get the ball rolling. Not everybody has money to invest, this allows the barrier of entry to be a none issue.

    I have never bought from a wholesaler but Iam open if the numbers work. Everything is about buying low and selling high. You don’t know that sellers situation, he may need this sale more than you can imagine.

    I have a friend who wholesales and he allows the contract to be broken if the seller finds a buyer before he does. He is very established and usually sells the property very quickly.

    Last, I agree with you. We should be honest and not crooks. If you can’t come through on the deal ( ie: don’t have a means to close the deal if you can’t find a buyer then you are a scammer)

    Don’t tie up the property. To the beginner, have your back up strategy in place do you don’t look like a jack ***.

    For full transparency, you as the wholesaler are required to disclose what assignment fee is to both the seller and buyer. Other wise you have to do a double closing where you mask the profit by closing the first deal, then closing on the sale with your buyer. ( don’t quote me, but I read somewhere that this is how it should transpire)

    1Reply
  • John Thedford
    Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes
    6y
    Originally posted by @Nathan Morgan:

    @Oren Markowitz congrats on your deal my brotha don’t feed in to people that try to down you. Keep it going and continue your success man!

     Would you sell YOUR house on those terms I might want to buy it LOL!!

    0Reply
  • Barry Pekin
    Specialist · Purcellville, VA · Member since 2015 · 1k+ posts · 841 votes
    6y

    @Account Closed,

    It's a shame that your question got hijacked with an argument about wholesaling.

    Is that a good price to offer your buyer?  Maybe.  You yourself said that the rehab cost was a very rough estimate.  Rehabbers prefer good numbers, but they also aren't going to trust them.  They also might have a different exit strategy than adding rooms and selling it, though presenting that option is a good idea.  They also might prefer fixing it up and renting it.

    In the end, it's the buyer who's going to determine what they are willing to pay.  It's a negotiation.  Oh, and you should have many potential buyers in case this doesn't work for the one guy.  If it doesn't work for any of them, then you know your numbers were off.  Talk to them and take the opportunity to learn what you did wrong.

    If it works, then congratulations!

    4Reply
  • Brian Pulaski
    Flipper/Rehabber · Montgomery, NY · Member since 2016 · 2k+ posts · 1k+ votes
    6y

    You are assigning a 2/1 with an ARV of $80,000 in my opinion. You are asking $34,000 with a $50,000 renovation. Those numbers are not good. The $120,000 ARV is going to be tougher to get to for the end buyer as it requires adding a bath and bedroom, which sounds more like gutting this house to nothing, a long permit process with many hurdles, etc. If you "selling" a $120,000 ARV by doing all that work your budget shouldn't just be a rough napkin budget.

    If I were you I would revisit the numbers and see what the real rehab budget should be, and then work with the $80k ARV and base your "asking price" off that.

    7Reply
  • John Thedford
    Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes
    6y
    Originally posted by @Glidden Rivera:

    @John Thedford

    I don’t wholesale but I think you are being very harsh. The gentleman found a deal, and he is assigning his contract for a fee. I agree that there are many scum bags that wholesale, but you can’t categorize all people into that category. Some people need it as means to get the ball rolling. Not everybody has money to invest, this allows the barrier of entry to be a none issue.

    I have never bought from a wholesaler but Iam open if the numbers work. Everything is about buying low and selling high. You don’t know that sellers situation, he may need this sale more than you can imagine.

    I have a friend who wholesales and he allows the contract to be broken if the seller finds a buyer before he does. He is very established and usually sells the property very quickly.

    Last, I agree with you. We should be honest and not crooks. If you can’t come through on the deal ( ie: don’t have a means to close the deal if you can’t find a buyer then you are a scammer)

    Don’t tie up the property. To the beginner, have your back up strategy in place do you don’t look like a jack ***.

    For full transparency, you as the wholesaler are required to disclose what assignment fee is to both the seller and buyer. Other wise you have to do a double closing where you mask the profit by closing the first deal, then closing on the sale with your buyer. ( don’t quote me, but I read somewhere that this is how it should transpire)

    This guy is NOT a buyer. These operators victimize sellers. They usually violate brokerage laws. There is NO integrity involved. They have a sense of entitlement. If this doesn't work out for the OP they move on to their next victim.

    0Reply
  • Glidden Rivera
    Rental Property Investor · Orlando, FL · Member since 2019 · 105 posts · 71 votes
    6y

    @John Thedford

    You may be right, I'm considering the fact that this is his first wholesale deal. These forums are to create dialogue and hopefully learn. I think the numbers are not great on this deal because he is sucking a lot of the juice out of the deal by being heavy handed. Typically wholesalers are aggressive on ARV's and conservative on real expenses.

    I probably wouldn’t do this deal as an investor,

    Because there is not enough meet on the bone.

    I myself am making an effort to build people as much as possible, unfortunately; we can’t make people honorable.

    This could be a good deal for everyone involved, if greed doesn’t make it a one sided deal.

    Honestly 5k assignment fee on this deal would be reasonable. At this rate, he would likely come through for the seller, the 22k he intends to make is a definitive barrier to the sale.

    I definitely understand why this deal would make you mad.

    0Reply
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