Wholesale Real Estate Pro

Okay, so if you’ve followed my instructions in step one and really put the time and energy in to educating yourself on your target areas and understanding the value of the property in those areas, then we are ready to move on to learning how much you can pay.

Wholesale Real Estate means buying and selling real estate at a discount. Think of other wholesale companies and what they do, exactly that. They don’t over pay for products and turn around and sell them for retail value. So, it’s the same with Wholesale Real Estate, you buy at a discount and then resell at a discount. That simple.

You set your profit margin when you purchase the property meaning that “you make your money when you buy”, you will here that over and over. Don’t take this lightly. Too many people over pay for property because they are just so motivated to do a deal that there emotions take over…..don’t let that be you. There’s a saying that goes something like this…..”when emotions are up, intellect is down”. This is true. Don’t be the motivated buyer or you will fail right out of the gates. Be patient and find the right deal.

So, how much do you pay…..well, that depends on your negotiating skills. A rule of thumb for wholesale real estate is .50 - .60 on the dollar, but that doesn’t mean you set the bar there. We buy many properties at .20 - .40 on the dollar which yields us larger profits and less holding times. The goal is to buy and resell as quick as possible and the less you pay, the less you charge and the quicker it moves. You want to be the go to person where other investors come for good deals. Once you build a reputation with other investors, then it will make turning profits quick and painless. We will talk more about building your list of investors to sell to in future articles.

A quick summary.

• Wholesale Real Estate means buying and selling real estate at a discount.
• Don’t be a motivated buyer. Be patient and find good deals.
• You make your money when you buy
• Don’t be emotional
• Never pay more than .50 - .60 on the dollar of the retail value of the property
• Buy low, sell medium and quickly
• Build a reputation with other investors as the “guy (or gal) with the good deals”

Remember, Wholesale Real Estate is not easy and you won’t get rich over night. But if you work hard at it, you will make A LOT of money!

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