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Wholesaling Houses: A Great Entry into Real Estate Investing



Wholesaling HousesBusiness Overview:

We all know that real estate can be a good business investment, but did you know that wholesaling houses can be highly profitable and requires no investment? First, a primer on what wholesale real estate investing actually means. You might hear this business referred to as flipping property because that’s essentially what you will do.


The initial goal is to find someone selling a home at a very low price, a motivated seller is usually what they’re called. Sellers can be very motivated for a variety of reasons—death, divorce, business relocation—and they need to get their house sold fast, hence the deep discount. Next, you’ll need to have a motivated buyer—not likely a newlywed couple looking for their dream home, but another type of real estate investor.


This buyer will expect a very competitive sale price, but usually understands renovations might be needed before they can sell the house for pricier market standards. If you’re flipping houses for profit, you’re the person in the middle of the seller and the buyer, you’re the matchmaker.


As a result, you need no money to make your “relationship” work. You simply collect your profit from the buyer, who you helped to find a great investment property, at the closing of the sale. This profit can run the gamut from a couple thousand dollars to tens of thousands of dollars, depending on the property. With profits like these, this is a business idea you must learn more about; your freedom from the daily grind could be literally just around the corner.


A day in the life of a wholesaling houses business owner:

Your daily goal as a businessperson who flips houses for profit is to create relationships that help you find properties with highly motivated sellers. You or your employees will have to be on the lookout for these gems every day, although establishing relationships with people who know early that these houses will be for sale (think: divorce lawyers, bankers, etc.) can make this part of the job much easier. Then you will have to touch base with the seller and explain your goal in helping them sell their property quickly.


Perhaps before you even contact the seller you will want to have a list of investors who you know are looking for houses to buy at great prices. Then your goal will be to connect the buyer and the seller and hope they will strike a deal. On a good day, you will be attending a real estate closing where you will collect your profit.

About Your Customers:

Your customers in the wholesaling houses business will be twofold: the seller and the buyer. This puts you in a unique position, but your actual profits will come from the buyer, so that’s your true customer. You will be working with the real estate investor (the buyer) to ensure he gets a good price and you get your assignment fee.


What You Need to Start:


  • An understanding of the business
  • A property being sold for a very discounted price
  • A real estate investor looking for a property to buy at a very discounted price


The Good:

  • There is little to no initial investment to start your business.
  • Profits can be very high.
  • You can build your business as quickly as you want.
  • You can hire employees to do most or all of the work.


The Bad:

  • You have to know how to grab these properties before others do.
  • You have to know real estate investors who will buy the property.
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