Have you ever considered creating additional income by using the techniques practiced in whole sale real estate? This is a great way to earn money without even having to put any of your money down.
What is Whole Sale Real Estate
Wholesalers typically make smaller profits but buy and sell properties in large quantities. They may buy 50 homes at a time from a bank and then sell them for a small markup to move them quickly and do it again. A more common whole sale real estate approach among creative real estate investors is to secure properties with no money down and do a “quick flip”. Typically, the property or owner must be distressed in some way for the deal to make sense.
Creative real estate investing is any non-traditional method of buying and selling real estate. But typically, a buyer will secure financing from a lending institution and pay for the full amount of the purchase price with a combination of the borrowed funds and his own funds (or his “down payment”).
How to Whole Sale Real Estate in Steps:
Put yourself out there. Make sure that other people in real estate, and homeowners wishing to sell their property, know who you are are where to find you. You should always network as much as possible so you can increase your chances of finding people like this. Some great spots to network are places like REIA groups, foreclosure auctions, or by talking to friends and family members. Also, you should also advertise yourself a great deal. Consider creating a website for your business.
- Find some leads. If the whole sale real estate properties don’t come to you, you need to make the effort to go out and search for them. Look for houses online through wholesalers lists and even Craigslist. A great resource you might consider using is MLS or “Multiple Listing Service”. MLS is essentially a place where real estate agents can list all of their available properties that are for sale. This service is better than most real estate listings platforms because it updates almost instantaneously. If all else fails, hit the road and search for properties yourself. Who knows, you might even find one that hasn’t been listed yet.
Find the right house. Although you will not be remodeling the property, the house flipper you sell to will be. If you want to get top dollar for your house, you need to make sure that the property does not have any major damage considering the price. When looking at a house, the kitchen is often one of the most important features to consider. Kitchen remodels can cost tens of thousands of dollars, so if the kitchen is in a terrible state, you won’t be able to sell the property for as much. Additionally, look out for any major structural damages like a termite infestation or a cracked foundation.
Calculate. You must always remember that both you AND the person you are selling to need to profit from this deal. An investor will never buy a whole sale real estate property to break even. They expect to make somewhere in the tens of thousands of dollars from flipping the house. If you subtract the cost of repairs and your wholesaler’s fee from the after repair value, or ARV, make sure there is enough profit to make the deal worth while for the investor.
- Find an investor. A smart way to approach wholesaling over the long run is by assembling a buyer’s list. These buyers are regular house flippers and real estate investors in your area who are frequently looking for property to make money on. Also, you might want to try hanging bandit signs around your area. Bandit signs are an incredibly cheap way to get your name out there and to find potential buyers. Once you have this buyers list, turn it into a mailing list and email these people every time you have a new property to sell.
- Choose the right offer. Just because an offer is higher in price, doesn’t mean it’s always the best option. Sometimes, a smaller cash offer can be a better choice than a higher finance offer. When people use finance, it is often a longer process with more unpredictability. Additionally, it will keep your property in your ownership for a longer period of time, meaning that you will have things like home owner’s insurance, utilities, and maintenance to pay for. Cash offers, in contrast, are clean and simple. Do the math and choose the deal that’s right for you.
I am earning money with whole sale real estate.
I am also earning money with this blog.
Message me to learn how.