One of the best ways to start making money in real estate is through wholesaling. The whole idea behind wholesaling is to make an offer on a property, get it accepted, then instead of buying the property yourself you will sell it ‘as is’ to another real estate investor. The investor will get the financing, buy the property and make all of the repairs.
This is a quick way to make money and you will have the benefit of:
- Not having to use your own credit.
- Only a small deposit ($10.00 to $100.00) of your own money will be used.
- You will not have to repair the property.
- You will not have to wait for the property to sell.
- It takes little training to get started.
What you are doing is making an offer on properties which are below market value and then reselling them to real estate investors before you even own the property.
There are a lot of real estate investors that are looking for properties that are below market value that they can repair and then sell or ‘flip’ and come out with a profit. They are looking at the after repair market value to determine if it is a good investment.
Investors are constantly on the look out for these types of properties. In essence, you will be doing the legwork in finding appropriate properties at the right price that will attract investors.
How much money can you make from these types of real estate deals? As an example, you find a house for sale for $70,000.00 with estimated cost of repairs of $10,000.00 and a market value of $100,000.00 after repairs. You get a written contract with an addendum that you have the right to assign this contract to someone else. Then you find an investor to assign the contract to. The investor will pay you a fee, anywhere from $1,000.00 to $10,000.00 and he will buy the property, make the repairs, and then flip it for a profit or rent it out. Your job is done by finding and assigning the property to the investor.
This is a quick in and out deal for you as you do not have to wait for mortgage processing or wait for repairs. Once you find an investor you collect your fee and go find another good investment property and do the same thing over and over.
Even if you are making only $1,000.00 to $5,000.00 per deal, you can turn these deals over fast and start building up some cash pretty quickly.
How to find the investors can be one of the easiest things to do. You see ads in the newspaper all of the time for just this type of real estate deal. You can place an ad for investors and you will probably get many calls. You will be saving them a lot of time by finding the properties for them.
Joining a real estate investment club is a great way to find investors for your wholesaling. These meetings are made up of investors, wholesalers, hard money lenders, real estate companies, and mortgage companies.
Do some research on real estate wholesaling if you want to get started in real estate investing but do not have the cash or credit to obtain properties. This is a great way for beginning investors to get their feet wet without having to invest a lot of money or time.