My Accidental Wholesale

[Sarah Msuya]

Investment Info:

Small multi-family (2-4 units) wholesale investment.

Purchase price: $188,600
Cash invested: $1,000
Sale price: $194,000

I got a property under contract that wound up to be too big of a rehab for my first deal per my private money lender. I learned the neighbor was someone I had talked to at my job about real estate before. When I realized I couldn't take the deal down, I called him to see if he was interested. At the same time, the duplex next door went on the market for about $100K more than I had this locked up at. He realized the benefit of buying the contract from me instead of waiting for it to go to the MLS

What made you interested in investing in this type of deal?

I wanted to do a BRRR and was looking for a small multi.

How did you find this deal and how did you negotiate it?

I saw a duplex that needed a lot of work. I told the listing agent that I really love side by side duplexes .
I put a low offer in and it didn’t get accepted. When she notified us, she said that duplex was a part of a portfolio she was selling for an estate. There was a side by side coming soon that I might like.

I searched the city’s property tax records and found it. I offered the valuation amount in the tax records and got it under contract before it hit the market.

How did you finance this deal?

I put $1000 EMD down and then whole-saled the contract.

How did you add value to the deal?

I got it locked up before hitting the market.

What was the outcome?

I sold the contract to the neighbor (past bank client of mine) for $5400. He had tons of instant equity. He's fixed it up and rented it and owns it to this day.

Lessons learned? Challenges?

1. That realtors don't typically get involed in wholesales and I can do the contract myself with a title company.
2. Talk to everyone about real estate, you never know what will come of it.
3. Continue working a lead from whatever angle you can. You can't buy it, can you wholesale it?
4. Don't waste having a property under contract if you can help it.