Are you interested in real estate investments or flipping houses?
You might be apprehensive to enter the business because of all the time and commitment it takes to make a profit. However, when you learn about wholesaling houses you’ll see why it’s a great way to make a profit.
Read on to learn why.
What is Wholesaling Houses?
In real estate, wholesaling takes place when the wholesaler gets a property from someone selling a home, and then markets the house to potential buyers. The wholesaler then assigns the contract to one of them and makes a profit.
The purpose of it is to get a property under contract and then selling it as soon as possible.
Let’s take a look at an example. Let’s say you have a house under contract for $80k. The property needs about 20k in repairs, and then the wholesaler plans on selling for 145k and make a profit.
Instead of making the repairs, the wholesaler finds a buyer who will pay $90k. The buyer will be able to sell the property and still make a profit. Meanwhile, the wholesaler also made 10k without owning the property or making repairs.
Who Can Benefit?
Since you don’t need a lot of money to get started wholesaling houses, it benefits starting up investors who are eager to sell and make money.
Wholesaling also benefits those investors who are starting out and don’t have a long credit history or bad credit. Since they don’t technically take ownership of the house, their financial information is not necessary.
Wholesalers also learn the ins and outs of how to flip houses for profit and make good deals.
How Do You Make Money?
Compared to investing in real estate and then flipping the property, with wholesaling you will make money faster. You don’t have to buy a property, fix it, put it on the market, and then wait for it to sell.
Wholesaling sometimes allows for you to get your money within days to weeks. Think about it, you don’t have to do all of the repairs or flip the house, so you can move on to the next project.
You will, however, have to be responsible for the closing of the property and all of the costs involved.
There are Cons
Of course, with everything, there are always cons. Wholesaling doesn’t guarantee you a steady income.
Weeks or months could go by without a new project when you’re getting started.
You run the risk of not being able to find a buyer. If you don’t have a buyer then there’s no deal. You run the risk of having to pay the seller, and your reputation could be at risk.
Ready to Begin Investing?
Wholesaling real estate is a great real estate investment option if you want to make a profit fast. It will teach you the skills necessary to identify and make great deals without going through the entire process of flipping a house.
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