Real estate wholesaling is a term used when a person gets into a contract with the seller of a property and then assigns the same contract to the final buyer. The question arises next: How to wholesale real estate? In real estate wholesaling, the wholesaler doesn’t buy the property; instead, he has the right to sell it on the owner’s behalf, because of this temporary contract. Of course, a fee is charged for this transaction, which is typically a percentage of the cost of the home. Real estate wholesaling comes into the picture when distressed off-market homes need to be sold. Distressed properties are those that the owner no longer needs and who is also uninterested or not in a position to spend the required time or money to make them ready for a regular sale. The seller and the wholesaler enter into a contract called the wholesale real estate contract, by which the wholesaler makes a deal to sell the property within a specific period for a minimum price that is agreed upon beforehand.
How to wholesale real estate?
Finding a perfect solution to “How to wholesale real estate?” is easy and can be done within a few steps. Wholesalers act as middlemen by assisting real estate investors in closing potential deals. They sign an agreement with the seller of the property to sell the property to another buyer. In this way, wholesaling real estate creates a regular income for investors. The main aim of the wholesaler is to sell the property at a higher price than that agreed upon in the contract with the seller. The difference between the contract price and the selling price is the profit earned by the wholesaler on the closure of the deal. If the wholesaler has a contract listing the price at $180000, he could try to sell the property for $200000. This difference in the contract price and the sale price is the wholesaler’s profit, also known as the “spread.” It would be $20,000 in this case.
Pros and cons of wholesaling
There are a few benefits of wholesaling. In wholesaling, you can make profits in a comparatively shorter period. For new investors, it is a great move as it needs little or no finance and experience. In a short period, you acquire knowledge about marketing and negotiating a sale. But wholesaling real estate comes with its own set of issues. The wholesaler must have a list of buyers. It is best that you have potential buyers before you even make an offer to a seller. It is also important to know about the preferences of the buyers so that the properties offered to them are tailored to their needs. Many wholesale companies have exclusive deals for investors. The disadvantage of wholesaling is that the profit margin is low, although the process takes a shorter time to complete and not much capital is needed.
Flat fee MLS
Flat fee MLS listing is the process in real estate in which a homeowner signs an agreement with a real estate agent for a one-time flat fee that is agreed upon, for listing his property on the MLS tool. MLS stands for Multiple Listing Service, which is a local database that contains all information related to a property for sale. All potential buyers, including wholesalers, check the local MLS for homes that are on the market. Therefore, as a seller, you must list your property on the local MLS so that your potential buyer market is large. The larger the number of people who show interest in your home, the faster you will be able to sell it. There are many advantages to using a flat fee MLS listing service. Apart from financial savings, as a homeowner, you are also in control of the entire sale process.
Advantages of Flat Fee MLS
The advantages of using a flat fee MLS are many, apart from the potential financial savings. As a homeowner, your property gets the maximum exposure, as your property is listed on the MLS. You can also decide the price of the property and how to market it, with the help of the flat fee MLS listing agent. Selling through a flat fee MLS is also faster as compared to selling through a traditional real estate agency. A flat fee agency also provides professional support. Flat fee MLS listing provides agent assistance to property owners, who still retain control over the sale process. In its entirety, selling a property through a flat fee MLS company is quick, efficient, and reliable.
How to Choose the Best Flat Fee MLS Listing Company?
When choosing the flat fee MLS company to help sell your home, you must check about the company. Also, it is essential to ensure their agents are members of the relevant MLS for your area. You can also read up on the reviews for their services, left by previous customers online. Whether they are actively marketing current listings on their website is also important. If they are considered the best in the business in your locality, that would be a great advantage. Some of the best flat fee MLS companies include Flat Fee Realty, Fizber, Houzeo, etc. Flat fee MLS companies such as Fizber have nationwide coverage and great customer service, while Houzeo’s plus points include a great website and an app that provide a lot of a la carte options to choose from. Also, Houzeo has a team-based approach. Their listing fees are also affordable, as they work with listing agents who don’t typically charge a commission.