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The best (and worst) states to wholesale real estate

This year has been a roller coaster for wholesaling. 

Not only is it becoming more and more crowded with competition, but states are literally BANNING “wholesaling”. 

However, it does not mean wholesaling is impossible. 

In fact, in this article we’ll not only show you a list of best and worst states to wholesale… but also a tip for making it “legal**” in those states, AND a guide to beating your competition! 

**NOTE: we are not attorneys. This article is for entertainment purposes please consult a licensed attorney for any legal advice and a tax/financial professional for any tax/financial advice. 

Table Content

List of states – Is yours listed below? 

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Lead engine in best and worst states for wholesaling

10 Worst States to Wholesale Real Estate In

NOTE: Some of this information may be inaccurate as legal policies are constantly changing

 

Illinois

   – Illinois has imposed strict regulations on wholesaling, requiring a real estate license for wholesalers. This legal hurdle adds complexity and cost, making it less attractive for new investors.

Oklahoma

   – Oklahoma recently enacted laws that require wholesalers to disclose their position and get a real estate license. These regulations can be a significant barrier for those looking to start wholesaling without a license.

Nebraska

   – Nebraska’s stringent licensing requirements for wholesalers and the necessity to adhere to specific disclosure rules can be a deterrent. These regulations make it challenging for wholesalers to operate without significant legal and financial investment.

Kansas

   – Kansas has tightened its regulations around wholesaling, necessitating wholesalers to have a real estate license and adhere to strict disclosure requirements. This can complicate the process and deter new wholesalers from entering the market.

Oregon

   – Oregon’s real estate laws are increasingly unfriendly to wholesalers, with licensing requirements and restrictions on assigning contracts. These legal hurdles make it one of the less favorable states for wholesaling real estate.

Arkansas

   – Arkansas has implemented regulations requiring wholesalers to obtain a real estate license and adhere to strict marketing practices, making it harder for new wholesalers to navigate the market without facing legal issues.

Michigan

   – Michigan’s real estate laws now require wholesalers to be licensed, which adds an extra layer of complexity and cost for those starting out. These requirements can be a significant barrier for new investors.

North Dakota

   – North Dakota has stringent regulations that demand wholesalers to disclose their position and have a real estate license, making it less attractive for those who want to enter the market without going through the licensing process.

South Dakota

   – South Dakota has recently tightened its regulations on wholesaling, requiring full disclosure and licensing for wholesalers. This can deter new investors due to the additional legal and financial burdens.

Minnesota

    – Minnesota has introduced stricter rules around wholesaling, including mandatory licensing and full disclosure requirements. These regulations add complexity and cost, making it a challenging state for new wholesalers to break into.

10 Best States to Wholesale Real Estate In

NOTE: Some of this information may be inaccurate as legal policies are constantly changing

Texas

   – Texas is a goldmine for wholesalers due to its rapid population growth and strong economy. The state’s diverse real estate market offers plenty of opportunities to find motivated sellers and flip properties quickly.

Florida

   – Florida’s warm climate and booming real estate market make it a top destination for wholesalers. With a large number of retirees and a steady influx of new residents, there are ample opportunities to find and sell off-market properties.

Georgia

   – Georgia, particularly the Atlanta metro area, is a hotspot for wholesaling. The state’s favorable business environment and growing job market attract new residents, making it easier to find motivated sellers and eager buyers.

Ohio

   – Ohio offers a mix of affordable housing and urban redevelopment opportunities. Cities like Cleveland and Columbus have seen a resurgence in real estate activity, providing wholesalers with a steady stream of potential deals.

North Carolina

   – North Carolina’s balanced mix of urban and rural areas offers wholesalers diverse opportunities. With cities like Charlotte and Raleigh experiencing rapid growth, there’s no shortage of demand for real estate transactions.

Arizona

   – Arizona’s warm climate and growing population make it an ideal state for wholesaling. The Phoenix metro area, in particular, has a dynamic real estate market with plenty of opportunities for wholesalers to find and sell properties.

Indiana

   – Indiana offers a stable and affordable real estate market, particularly in cities like Indianapolis. The state’s low cost of living and strong rental demand provide wholesalers with numerous opportunities to find motivated sellers.

Tennessee

   – Tennessee’s growing economy and attractive real estate market, especially in cities like Nashville, make it a favorable state for wholesaling. The state’s relatively low cost of living and business-friendly environment attract new residents and investors.

Missouri

   – Missouri, with its affordable housing market and strong rental demand, is a great state for wholesaling. Cities like Kansas City and St. Louis offer plenty of opportunities to find and flip properties quickly.

Alabama

    – Alabama’s low property prices and high rental demand make it an excellent state for wholesaling. The state’s real estate market is stable, providing wholesalers with numerous opportunities to find motivated sellers and eager buyers.

In states where wholesaling is restricted or outright illegal without a real estate license, there’s often a workaround that allows for a limited number of assignments. Many of these states permit 1-2 assignments per year without requiring a license. However, if you plan to exceed this limit, obtaining a real estate license is a straightforward and effective solution. This not only keeps you compliant with state laws but also adds credibility to your business. Remember, we are not lawyers, and this article is for entertainment purposes only. Please consult with a licensed attorney for any legal advice.

Tips for Beating Competition in a Crowded Market

Here’s a quick video from our Founder, Ryan Dossey, on what he would do today if he started wholesaling:

Consistency is Key

   – To stand out in a crowded market, it’s crucial to be consistent with your marketing and sales efforts. Whether you choose direct mail, online ads, or any other medium, stick with it. We recommend starting with a monthly budget of at least $2,500 for direct mail, as it’s a powerful tool when done regularly.

Establish an Online Presence

   – Most sellers will Google you before deciding to do business. Make sure you have a professional website, active social media profiles, and positive online reviews. This not only builds credibility but also helps you reach a wider audience.

Master Your Trade

   – Being really good at analyzing deals is essential. The better you are at spotting good opportunities and assessing their potential, the more successful you’ll be. Invest time in learning and improving your deal analysis skills.

Build Rapport

   – Being great at building rapport with sellers and buyers is a game-changer. People prefer to do business with those they trust and feel comfortable with. Focus on active listening, understanding their needs, and maintaining good communication to foster strong relationships.

Hone Your Sales Skills

   – Knowing how to sell effectively is crucial. This involves not just selling the deal, but selling yourself and your services. Develop your negotiation skills, learn to handle objections, and always be prepared to close the deal. Great salesmanship can set you apart from the competition and drive your success.

Conclusion

Wholesaling real estate can be a lucrative venture, but it’s essential to navigate the complexities and regulations that vary from state to state. By focusing on the best states for wholesaling, staying compliant with local laws, and adopting strategies to outshine your competition, you can thrive in this competitive field. Remember to be consistent with your marketing, establish a strong online presence, master deal analysis, build rapport with clients, and hone your sales skills. With these tips in mind, you’ll be well-equipped to succeed as a wholesaler. Always consult with a licensed attorney for legal advice, as this article is for entertainment purposes only. Happy wholesaling!