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Housing Development

Real Estate Wholesaling

Wholesale real estate refers to a short-term business strategy that investors can use to make quick and steady income in the real estate market.  In wholesale real estate transactions, the wholesaler enters into a purchase contract for a home from a seller for a small earnest money deposit. The contract spells out the amount the wholesaler will sell the property for and the required time period for the sale.

After the wholesale real estate contract is in place, the wholesaler attempts to find an interested investor. Once found, they reassign the contract to the investor at an agreed-upon higher price. The difference in prices is known as the wholesale fee and can be 5% to 10% of the property price. This goes to the wholesaler.  Usually, wholesalers look for a distressed property that the owner doesn't want to spend time or money on. The owner is usually motivated to sell and often doesn't want to work with a real estate agent.

Wholesale real estate may be well suited for people interested in real estate transactions but who don't have the financial wherewithal to actually buy and sell properties.


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