Wholesaling in California

[Benjamin Garcia]

Has anybody had success wholesaling in California? Been reaching out to different realtors, brokers and attorneys in the SF East Bay Area and have been getting some pushback. Some are mentioning legal issues with trying to wholesale in CA. Which makes me wonder, how legal is it in the state? Seems like investors in other states thrive with this strategy.

Also, low inventory and high prices are a little intimidating. Anybody had any luck in the Bay?

[Max Gradowitz]

I work with and advise wholesalers all around California. Is it possible the attorneys you contacted don't know about wholesaling? Certainly. Wholesaling is relatively rare in certain areas because properties are so expensive, so attorneys in those areas might be clueless as to what it is. However, is it possible they know a lot about it and are advising you properly? Absolutely. Attorneys advise you of risks, so there is a good chance that is why you are getting push back. Even if you go about it the least riskiest way possible from a legal standpoint (which is really what you should ask a wholesale friendly attorney how to do if you decide to wholesale), there is always some risk involved. Look up Business & Professions Code 10139. Then look up the desist and refrain order list on the DRE website so see how often people get hit with violating  Code 10130, "practicing real estate without a license".

That being said, people wholesale all the time in California without problems. I see it successfully and lucratively performed all the time. It's usually only when someone does it without performing risk-mitigating steps beforehand and something goes really wrong and someone gets angry and reports you to the DRE when you get in trouble. It's always a good idea to have a wholesale friendly attorney to advise you accordingly, local or not, so you understand these risks and enact risk-mitigating steps properly beforehand.