Wholesaling Real Estate Is The Perfect Strategy for New Real Estate Investors
What is Real Estate Wholesaling?
Wholesaling real estate involves finding a property at a bargain price (or negotiating a discount), putting the property under contract and either assigning the contract or re-selling the property to an investor buyer.
It especially refers to the “unimproved” resale of such discounted properties to the sort of buyers who either intend to fix and sell (rehabbers) or hold as a rental (landlords).
Wholesaling real estate is in my experience the simplest and most elegant way a relative newcomer to real estate can successfully make money real estate investing with no bank financing, very little money and no repair hassles.
Many newcomers to the house flipping business have found much to their dismay that supposedly simple “paint and carpet” repair jobs often turn into nightmares.
If you intend to build wealth with rehab real estate or rental property investing, wholesaling provides the most useful and profitable real estate investment education. Below you will find information on various aspects of wholesaling real estate in the real world.
Wholesaling Vs. Flipping
How does Wholesaling real estate differ from other definitions of flipping and real estate investing?
The term “real estate wholesaling” came into popular use in the real estate investor communities of Maryland after widespread mortgage fraud came to be labeled as “illegal flipping" by the department of housing and urban development (HUD).
Prior to that time, flipping had been the term used to describe the process of securing properties with little to no money down and executing a quick transfer of control (for a fee) to another buyer.
In popular usage today, flipping includes any transaction that involves the purchase and resale of property…particularly when that resale takes place less than a year or two after the original purchase.
In general, flipping is used in the context of rehab real estate (fix and flip). Wholesaling on the other hand refers to the narrower set of house flipping transactions of much shorter re-sale time frames (hours, days or weeks), involving little or no repairs and little or no capital.
The Perfect Start
The two primary vehicles for wealth through real estate are real estate merchandising (flipping) and real estate investing. Although real estate flippers often refer to their activities as real estate investing, this is not technically true.
Real estate merchandisers fall into the category of wholesaler or rehabbers:
Wholesalers generally identify bargain properties, gain an equitable interest through a contract and transfer their equitable interest to another investor for a fee. Rehabbers are entrepreneurs who undertake the risk to purchase, repair and re-sell such bargain properties.
Both wholesalers and rehabbers fall under the "real estate flipper" category. They are real estate entrepreneurs who have to work to make money.
Real Estate investors, on the other hand, have their money work for them through a cash-producing real estate portfolio.
The knowledge you gain on this website is about helping you work for your money first as a wholesaler, in preparation for a successful career rehabbing properties or real estate investing.
Advantages and Disadvantages
The advantages and disadvantages of being a real estate wholesaler as opposed to being a rehabber, landlord or staying on the J-O-B.
Your Wholesaling Self-education and Fast Start
How can you start fast? Here are some time-delineated possibilities for you, personal success factors as well as marketing techniques that can be carried out on any budget.
Step-by-Step,"Real-life" Case Study
Most commonly made mistakes
Most frequently asked questions
My Disastrous wholesale real estate deals
3-Part Teleseminar Wholesaling Course
Return from Wholesaling Real Estate to House Flipping Home