Real estate investing has been one of the most widely practiced methods of investment since ages. However wholesaling or wholesale real estate investing is a comparatively newer concept and is a subset of the larger domain. Lately, wholesale real estate investment is being adopted by many people to channelize money. However, the main challenge lies in the initiation itself i.e. arranging the larger amount to invest. Various methods have been devised to start wholesaling even with lower capitals but the buyer needs to maintain a definite capital before going for such large-scale investments. On the contrary wholesaling provides the best option of the buff up the incoming cash volume manifolds when the starting amount is low. Although the end cash is not that large, the buyer gets to know all the whereabouts of real estate investing.
A DETAILED DESCRIPTION OF WHOLESALE REAL ESTATE INVESTMENT
Basically, the whole process of wholesale real estate investment takes place when a buyer buys a property or takes the contract of a property and subsequently sells it or assigns the contract. The investor can also sell the property that he holds to another potential investor who can further fix it up and rent it. The buyer needs to find the cheapest property to wholesale so that the end buyer makes a profit along with all the intermediate ones. In such cases, the off-market properties are the ones that prove to be beneficial. These are the properties which the owners want to sell but have not put up any advertisement or sale notice regarding the same. The best ways to locate off-market properties are attending Real Estate Investor Association (REIA) meetings, direct mailings, advertisements expressing the will to buy off market properties, or surfing through necessary websites. The whole thing of wholesaling demand the person involved to be extremely good at marketing so as to crack the best deals even at lower capitals.
THE CHECKLIST BEFORE GOING FOR WHOLESALE REAL ESTATE INVESTING
- A THOROUGH UNDERSTANDING OF THE COMPLETE PROCEDURE OF WHOLESALING
The real estate wholesaling shares some common features with the regular concept of wholesaling where a manufacturer, the first-hand buyer, and the final buyer are involved. As a wholesale real estate investor, one has to accomplish the following things:
- Locate a cheap and undervalued property
- Finding a real estate investor to assign the contract
- Work with the seller to finalize an agreement
- Obtain a cut for own for locating the property
The whole concept of wholesaling revolves around the points discussed above which involves all the base work that one has to be assured of before getting into real estate wholesaling.
- THE SPEED OF WORK
The wholesaling keeps the risks low since you are the one who is dealing with the property and not buying them. The job, however, requires the person to be quite fast in his actions and punctual as well. One needs to adopt strategies to find the cheapest properties before other wholesalers find them. The set of necessary qualities that an investor should possess in addition to work speed and punctuality are organized, updated with the changing market trends, focused, distinctly choose the best out of a lot of deals and available real estate properties, and listen to own self as soon as the mind tells the thing to be right.
However, a mere possession of such qualities does not ensure a cent per cent success in wholesaling. But when a perfect combination of the above-listed qualities is put to use by a person, he can crack good deals in wholesale real estate investment.
- THE PEER WORKING STYLE
Similar to the real estate investment, wholesaling also requires strong interpersonal skills. It is you who would be dealing with the two parties i.e. the buyer and the seller. One needs to negotiate between the two parties and crack the best possible deal with a profit margin for his own. This can only be achieved if he can communicate well with both the parties and get to know about their needs and conditions in detail.
- THE LOOK OUT FOR LEADS
The wholesale real estate investment requires a much lower financial investment as compared to other comparable forms. But the person needs to go deeper in the acquisition of leads. The leads include the seller and investor. One should look out as much as possible to get the best possible buyers and properties. The leads might be derived from ads, court records, appraisers etc. The business solely depends on the strategy that one adopts for gathering the necessary leads.
The wholesale real estate investments have the potential to yield great results when the right methodologies and strategies are adopted for the same. Instances suggest that the wholesalers make money starting from 2000 dollars to 10000 dollars per deal. It should, however, be noted that it takes some hard work and great marketing strategies to tackle the game of wholesaling. If one hones up these skills and gathers a lot of contacts, he can be the unbeaten winner in the field of wholesaling. Basing on these factors, one can decide to opt for this method of investment.