……I got a call early last week and was asked if I had wholesale properties for sale. The term wholesale can be confusing. So I though I would share what I know about wholesaling and why the term raises yellow flags for me.
A wholesale property can be bought many different ways; bank REO’S, Hud, VA, Short Sales, etc. I have also seen them at investor events. Some are good deals and others are not If I were to buy from a wholesaler I would want to know a few things before I committed to the sale.
1. How was the value determined? 2. How much money is needed for fix-up and who determined the cost? 3. How many successful properties has the wholesaler actually done him/herself? 4. Do they have all the systems set up to assist you through completion? 5. Will they still be there after closing? 6. If I can’t or do not want to sell, what is the rent in the area? What is my profit picture with that scenario? 7. Do they have recommended financial institutions? 8. Do they own proprties in the area?
Let us consider the above questions: #1. Value. Determining the value of a property can be very complex. Comparable sales must be considered. These are sales of like properties in the subdivision or area. The square footage should be within 10% of the subject property. The number of bedrooms and baths should be the same. The properties should be in similar condition and lot placement. For example, has the property been recently remodeled? Or is it located on or near a busy street, commercial property, railroad, shopping center, etc.
As you can see there are many factors to be considered when calculating the value of a home. That is why I recommend that you consult with a licensed professional realtor. Their access to information and expertise can help you avoid a potential costly mistake.
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Brett young
Valley Realty
Owner/ CEO Roof Top Investment
Real Estate Investment
http://www.rooftopprofitmax.com/
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