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Wholesaling Real Estate – 2024 Guide and Costs

This year it’s an exciting time to get started with wholesaling real estate! But with all new business ventures, there are obstacles, costs, and struggles. We’re a call intake and lead management center that services wholesalers (and our owners are wholesalers themselves!), so in today’s article, we’ll be breaking down everything it takes to get started in wholesaling real estate…

Everything from costs, how to find deals, how to sell deals, and everything in between.

So let’s start with the first question you might have…

What is wholesaling real estate

Wholesaling real estate is a strategy where investors find off-market properties to contract at a low price and then sell that contract to end buyers at a higher price, without ever actually owning the property. It’s a quick-turnaround tactic that leverages deep market knowledge and networking to identify and secure deals before flipping the contract for a profit. This approach allows wholesalers to act as the middleman, connecting sellers looking to unload properties quickly with buyers ready to take on new projects.

The key skill set that wholesalers have, is finding deals directly from sellers.

Here’s a video that explains off-market deal finding:

Is wholesaling real estate worth it?

Real estate wholesaling can indeed be a lucrative venture, offering the potential for significant financial gains to those who are dedicated and persistent. Like any business, success in wholesaling requires a combination of consistent effort, rapid learning, and strategic networking. With the right approach and enough perseverance, becoming a top wholesaler in your market and achieving seven-figure earnings annually is entirely within reach.

How do you perform a wholesale deal?

Executing a wholesale deal effectively positions you as the crucial intermediary in the real estate transaction. Here’s a simplified breakdown of the process:

– Identify a Motivated Seller: Your journey starts with finding a seller (Party A) looking to offload their property swiftly, often due to reasons like financial hardship, the need for quick cash, or a property in less-than-ideal condition.

– Negotiate the Deal: Engage with the seller to agree on a purchase price that allows room for your profit margin. The key here is to ensure the deal is beneficial for both parties.

– Sign the Contract: Once a price is settled, you sign a contract with the seller, securing your right to buy the property. This contract is your ticket to the next phase.

– Find an End Buyer: With the contract in hand, your next step is to locate an end buyer (Party C), usually another investor with ready cash, interested in taking over the deal.

– Sell the Contract: You sell the contract to the end buyer at a price higher than what you negotiated with the seller. This price difference is where your profit lies.

Close the Deal: The end buyer finalizes the transaction with the original seller, stepping in under the terms you initially agreed upon.

– Profit: You earn the difference between the contract price with the original seller and the amount the end buyer pays for the contract, known as the ‘assignment fee’.

This streamlined approach allows you to profit from real estate transactions without owning the property, with your earnings coming from successfully connecting motivated sellers to ready-to-invest buyers.

What does it cost to find a deal?

Diving into the world of wholesaling real estate, one of the first hurdles you’ll encounter is the cost associated with finding a deal. At its core, a wholesaler is part salesperson, part prospector, and part marketer. The journey to unearth those hidden gem properties is where the real hustle begins.

– Time vs. Money: The adage “you either have time or money” couldn’t be more accurate in wholesaling. You can indeed embark on the quest for deals without spending a dime, but this path demands a significant investment of your time in prospecting activities.

– Prospecting for Deals: Free methods to find deals include driving for dollars (scouting neighborhoods for potential properties), networking with property owners, and tapping into social media groups or real estate forums. Each of these methods requires a diligent, consistent effort and a knack for building relationships and spotting opportunities.

– The Cost of Time: While the financial outlay might be minimal when relying on sweat equity, it’s crucial to value your time. Hours spent researching, networking, and scouting are substantial investments in your wholesaling business.

– Marketing Expenses: On the flip side, if you choose to expedite the deal-finding process through paid marketing strategies, costs can include direct mail campaigns, online advertising, or hiring a team to generate leads. These methods can significantly increase your reach and potential to find deals but at a financial cost.

In essence, while it’s possible to start wholesaling with minimal upfront financial investment, the true cost lies in the time and effort required to prospect for deals effectively. Whether you choose to invest more time or money in this endeavor, the key is to maintain a consistent, focused approach to uncover those lucrative wholesale opportunities.

How to find deals for free

Deals are out there that just take your time to uncover.

The simplest way is to contact all the FSBO’s (for sale by owner). And all the social media (facebook) postings of owners listing their property without an agent. You HAVE to work these DAILY. And it takes times and multiple contacts and attempts.

Here’s a video on unearthing some deals with this method:

What is the average wholesale fee?

The average wholesale fee in real estate wholesaling can vary widely, largely hinging on your negotiation skills and the quality of the deal you secure. At the heart of it, your earning as a wholesaler is the difference between what you contract a property for and what you can sell that contract for to an end buyer. Here’s a closer look at what you can expect:

– Negotiation is Key: The amount you earn depends on your ability to negotiate a good purchase price with the seller and a higher sale price with the buyer. Your margin – the wholesale fee – is the difference between these two.

– The Range of Fees: On the lower end, it’s not uncommon for wholesalers to earn a fee of around $5,000 per deal. This is often considered the minimum for the effort involved in sourcing and securing a property.

– Potential for High Earnings: While less common, it’s possible to land a wholesale deal that nets a fee of $100,000 or more, especially if you manage to secure a highly lucrative property under market value and find an end buyer willing to pay a premium.

– Setting a Minimum Threshold: Given the effort, time, and skill involved in wholesaling, setting a minimum threshold for your fee is wise. Aiming for a minimum fee of $5,000 to $10,000 ensures that you’re compensated fairly for your work, preventing scenarios where you might end up earning less than minimum wage for your efforts.

Remember, the key to maximizing your wholesale fee lies in finding great deals and negotiating effectively. While the potential for high earnings exists, each deal’s profitability will ultimately depend on your acumen as a wholesaler.

Skills needed for wholesaling real estate

Wholesaling real estate isn’t just about finding and flipping contracts; it’s an art that requires a specific set of skills to be successful. At the foundation of these skills is the ability to accurately price property, which is critical in ensuring that you can both secure contracts and sell them effectively. Here’s a breakdown of the essential skills needed:

– Understanding After Repair Value (ARV): A proficient wholesaler must be adept at estimating the ARV of a property, which is its estimated value after all necessary repairs and renovations are completed. This figure is crucial as it helps you and your potential buyers understand the property’s potential value, guiding the negotiation and deal-making process.

– Competent at Comping Prices: Comping, or comparing similar properties in the same area, is another vital skill. This involves analyzing recent sales of comparable properties (comps) to determine a fair market value for the property you’re looking to wholesale. This assessment helps in setting a realistic purchase price that attracts buyers while leaving room for your wholesale fee.

– Marketing and Sales Savvy: Beyond pricing, a wholesaler must also excel in marketing and sales. This involves effectively promoting available properties to potential buyers and using persuasive communication to close deals.

– Negotiation Prowess: Strong negotiation skills are paramount. As a wholesaler, you need to negotiate favorable contract terms with sellers and then negotiate the sale of that contract to an end buyer at a higher price, ensuring your wholesale fee is covered.

Mastering these skills starts with a deep understanding of how to evaluate a property’s value accurately. By honing your ability to estimate ARV and comp prices, along with sharpening your marketing, sales, and negotiation skills, you position yourself for success in the competitive world of real estate wholesaling.

What is a wholesale price in real estate?

The logic behind this formula is straightforward: by securing a property at 75% of its ARV (minus repairs), the wholesaler allows room for their profit margin, as well as any potential costs or discounts the end buyer might require. This disciplined approach to pricing ensures that wholesalers can make offers that are both attractive to sellers in distress and viable for ensuring profitability on the deal.

Where to find wholesale deals direct-to-seller?

Finding properties to wholesale is a critical step in the wholesaling business, requiring a mix of creativity, diligence, and strategic marketing. Here’s a bullet-point list of effective marketing methods for sourcing direct-to-seller deals:

– Direct Mail Campaigns: Send personalized letters or postcards to potential sellers, targeting distressed properties, absentee owners, or individuals who have inherited properties.

– Driving for Dollars: Drive through neighborhoods to identify distressed properties, then research owners and reach out to them directly.

– Bandit Signs: Place signs in strategic locations with messages like “We Buy Houses Cash” to attract sellers looking for quick sales.

– Online Marketing: Utilize social media, Craigslist, and real estate websites to advertise your services and attract sellers.

– SEO and Content Marketing: Create valuable content targeting keywords that distressed sellers might use when searching for options online, improving your website’s visibility.

– Networking: Build relationships with real estate agents, attorneys, and other professionals who can refer potential deals to you.

– Wholesale Real Estate Websites: Join platforms and forums dedicated to wholesaling where you can find leads and connect with sellers.

– Public Records: Search for properties with liens, pre-foreclosures, and other public records indicating a seller might be motivated to sell quickly.

– Real Estate Auctions: Attend auctions to find potential deals and network with sellers who might be interested in a quick sale before the auction.

– PPC Advertising: Invest in pay-per-click ads targeting keywords that motivated sellers are likely to use, leading them to your website.

Each of these methods has its own set of advantages and costs, and successful wholesalers often use a combination of these strategies to consistently find deals.


Wholesaling real estate emerges as a compelling business venture accessible to many, notably because it doesn’t demand formal education or substantial initial capital. At its essence, wholesaling hinges on the ability to spot undervalued properties and connect them with potential buyers for a profit, acting as the crucial intermediary.

The core of success in wholesaling lies in the relentless pursuit of deals, a journey that requires either time, money, or a blend of both. For those with limited financial resources, investing time in direct marketing strategies, networking, and learning the nuances of the market can pave the way. Conversely, with available capital, leveraging paid marketing methods can expedite deal discovery.

In summary, wholesaling in real estate presents a unique opportunity where the barriers to entry are not dictated by one’s educational background or financial standing. Instead, success is shaped by the individual’s dedication, strategy, and the ability to effectively utilize either time or money in uncovering and negotiating potential deals.