Wholesaling houses is a great way to make money fast. In fact, your #1 exit strategy on any home you buy is to WHOLESALE IT! Wholesaling, it's not just for beginners.
Wholesaling typically requires little or no money to start. And there is very little risk. However, you need to educate yourself about the pitfalls of wholesaling as well as the peaks.
Originally, buying a house to resell fast with no improvements was called flipping. The term wholesaling was born when the term "flipping" got a bad reputation from shady real estate investors scaming people. And somewhere ethical investors coined the term wholesaling as a better way to separate themselves.
However, the term flipping made a come back as a catchy word used by television shows for folks buying, fixing, and reselling a house.
Again, wholesaling is finding a property that needs work and is selling for way below its potential value. Then you sell it for a small profit to an investor who wants to put the time and money into repairing it and selling it retail for a larger profit. It's a win/win.
I just found a home that was listed for $45K. Upon inspection, it needed a lot of work and had foundation problems. I offered $25K. They politely said no thank you. About a month later they came back and said, "Would you please by my house for $25K?"
No one else wanted to do the work. Plus it could not be sold with traditional financing because it could not pass the inspections.
So I purchased the house for $25K that is worth $139,000 (the ARV or after repair value). I can easily wholesale that house to another investor for $45K and make a quick $20K. It took me very little time to make that money.
I can do this because I used the KISS System to locate qualified investor buyers who want to fix and flip houses retail. It's what they do.
The new buyer will put about $45K in repairs into the house according to my estimates (I am a licensed contractor) and he is able to sell it for $139,000, making a gross profit of about $40K (I allowed approximately $10K in selling cost).
Yes, I make less money, but I also made it quicker than he will make his money.
As you grow your business, you will be able to handle more volume on rehabbing houses, but you have to define your limits and grow your business smart.
So wholesaling houses is a fantastic way to use another strategy when you either need fast cash or just can't handle the volume of another rehab, but still want to make money for your time and effort.
Check back soon to get your copy of our FREE Guide. We will be offering tips on finding houses to wholesale.
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