Wholesaling Pays You to Learn How to Be a Landlord or Rehabber
When I first met Jason Dillard, he was very excited about real estate investing. He was buying houses and renting them out. He was also buying houses, fixing them up and selling them. But truth be known, his good deals were lucky and his bad deals were crippling because he wasn't fulling educated on the houses he should buy and why. Once a sceptic to the concept of wholesaling, Jason now promotes and teaches it. Jason writes:
Can you get paid to learn how to be a Landlord or Rehabber? As a matter of fact, become a wholesaler; and that is exactly what you can do! I used to think that I couldn’t get good deals from other investors. If it was such a good deal, why would they sell it and not keep it for themselves? I then realized that I could make money without ever dealing with a tenant or driving a nail. As a wholesaler, you locate, take control, and pass along the opportunity to another investor for a fee. Think about it. There are no payments to make, no contractors to hire, no begging banks for money, and no tenants to baby sit. However, the best benefit is the low risk. Now it’s OK with me to only make 5K and leave 20K for the rehabber. He definitely deserves it. All I have to do is generate enough leads to do 4 times the transactions as the rehabber; and I can make just as much money for way less work.
Now for the subject at hand…where does the learning process of being a rehabber or landlord take place? Here’s a great concept: Locate a deal and tie it up with a contract that includes some sort of contingency. Next, try to sell the deal. If you can’t find an experienced investor that will buy it, find out why. Was it the price, location, repairs too much, configuration of the house, etc? Since you have a contingency clause in the contract, you do not have to buy the house. You have lost nothing. Plus, now you know why the experienced rehabber did not buy the property. I wish someone would have explained this to me when I tried to do my first rehab. I jumped in with both feet; and after a lot of risk and hard work, I almost did not make a dime.
What if the house you have under contract sells to the experienced investor quickly? For one thing, you have just made thousands of dollars. The more valuable thing, you have now, is knowledge. Find out why it sold so quickly. Now you know what constitutes a good deal for that area. Wholesale a few more the same way and watch how the rehabber works through his deal. Now, if you want to be a rehabber and make more money per deal, you can do it with confidence. This concept works the same for rentals.
I wish I would have gotten paid to learn. I learned it the hard way, and my mind was closed to the wholesalers in my area. Now 90% of the deals, that I do, are wholesale deals. I still have rentals and still do rehabs, but my income from wholesaling is what helped me go full-time in real estate. Take my advice…be a wholesaler first…for the money AND the education.
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