A Step-By-Step Guide To Wholesale Real Estate
Considering investing in real estate? You don’t have to literally buy a property and take possession of it in order to do so. Without ever possessing the property, you can make money on real estate through real estate wholesaling. To make it work, however, it takes dedication and a precise set of skills.
Here, we’re going to look at handling wholesale real estate, and how to profit by doing so.
Wholesale Real Estate – What Is It?
If you enjoy discovering properties that are undervalued and you want a good strategy for real estate investing, you may consider short-term investment in wholesale real estate. Wholesalers discover just the right properties and, as a part of their real estate investing strategy, put them under contract with the seller. Following that, for a fee, they sell the contract to an investor when they find one who views the property as attractive or lucrative.
Necessary improvements are made to the property after the investor takes over the home and they then either rent it out or flip it for a higher price.
Step-By-Step Real Estate Wholesaling
You need to get your business set up. To start your wholesale real estate business, set up an LLC (limited liability corporation). Once that’s done, it’s time to search for investment properties on the real estate market. Then, do this:
- Find yourself a truly motivated seller, a distressed property, or both. The more someone wants to sell their property, the more they may be willing to take a lesser amount for it. You’ve got to have the grit with which to do this. It’s business – nothing personal.
- Hopefully you are adept at the art of negotiation, because that’s the next step. You’re trying to negotiate with the seller the lowest price possible. That’s how you’re going to make your money, after all. You pay as little as possible and get the investor to pay a considerably elevated amount. They have the money to invest in the property and reap the benefits, whereas the seller doesn’t have that kind of money.
- A wholesale contract will be drawn up with the seller and you will sign it. If you do the contract yourself, make sure that everything is 100% correct.
- Now an end buyer needs to be found. Through local real estate meetups and social media, you’ll be able to build your network. Never underestimate knowing somebody who knows somebody… who knows somebody. Never refuse introductions to as many potential investors as possible.
- It’s time for more negotiations once you find a potential buyer. As you can see, the power of negotiation is a necessary talent if you’re going to be a real estate wholesaler. Here, your transaction fee is the topic of negotiation. It’s where you’re going to make your money.
- Finally, the contract that you and the seller signed will now be assigned to the buyer. The buyer is agreeing to take possession of the home after buying it and you, for assignment of the contract, agree to accept a fee.
- Settlement is the final step. The deed is transferred to the end buyer after all proper documents are signed by all parties. The cost of the home and closing costs are paid by the end buyer. You keep your profit and pass the price agreed on to the seller.
Let Real Equity Acquisitions Be Your Guide When It Comes to Wholesale Real Estate
If you’d like information about wholesale real estate, contact the professionals at Real Equity Acquisitions. You can email us at firstname.lastname@example.org or talk to a representative by calling us at 866-210-8835.