Wholesaling listed properties

[Patrick Britton]

I'm going to post something that I am certain will generate a huge amount of both positive and negative feedback.  But quite frankly, I am sick and tired of the snake oil salesman and garbage this industry attracts.

For starters, wholesaling a property can work to the benefit of all parties involved. However, it only works in very specific circumstances under very specific conditions. It never works with an MLS listed property.

Too many times I've seen "deals" that were taken right off the MLS. Sometimes, the "investor" selling the "deal" provides an MLS number. I'm not sure how stupid you have to be to provide the MLS number of the deal you're trying to sell others but I'm guessing it's quite extraordinary.

I see wholesalers trying to sell contracts of properties at full listing price despite the fact that the listing recently reduced price. For instance, there was someone who was trying to offload a contract on a property for $875,000. Well, on the MLS the asking price was $800,000...It had been originally listed for $875,000 for several months before it reduced price. The question I had for the wholesaler was why somebody would pay $875,000 for something that they could get for $800,000. There was no answer or reply... Obviously, if no investor would purchase the property for $800,000 there is no way they would pay $875,000, duh!!!!!!!!!!!!!!!!!!!!!!

Don't get me wrong, I am not against wholesaling. In fact I have done a few myself.  But they were all off market and all parties benefited.

On the other hand, trying to wholesale a listed property is a waste of everyone's time.  It is deceitful, dishonest, greasy and worst of all adds absolutely no value whatsoever.  In fact, it takes away value, like a disease. 

To all wholesalers, know that your value is in finding off market deals and placing them with legitimate investors.  You add no value by needlessly locking up a property that has already hit the largest buyer's list on the planet.  

[Ned Carey]

I agree completely that some wholesalers offer some pretty stupid deals. If a wholesaler is trying to wholesale a listed property that they do not have under contract, that is downright silly. It is downright stupid too. 

However I disagree with the basic concept that it is wrong to wholesale listed properties - IF the wholesaler puts it under contract first. If the wholesaler can negotiate a deal so good on a listed property that he or she can resell it to an investor at a price that makes sense for the investor, then why not?