Does it make sense to stay with wholesaling permanently?
Many people want to use wholesaling as a stepping stone onto "larger" things like rehabs and SFH rentals or commercial rentals.
I have heard that an average rehab profits $18,000 and takes 4 months. That is $4,500/month. You can make more than that wholesaling.
Also, if you're renting out homes, you are probably only making a few hundred dollars per month after the mortgage is paid. And if you paid all cash for the house, then you are not going to see that money back for decades unless you sell the house.
It seems to be that wholesaling, if done correctly and with an adequate marketing budget, is the business to be in.
BRRRR is another story. That is maybe the only thing that makes more sense, or just as much sense, as wholesaling.
What do you think?
Most Popular Reply
Some people do very well wholesaling but wholesaling is only a job if you are doing the work, not a common business structure. A business runs without you putting in the hours and doing all the work.
A portfolio of properties can be managed by someone else and become mailbox money. Over time wealth accumulates with the right properties. This is why Hedge Funds and other Institutional Investors are buying heavily in the rental market. They are not wholesaling for cash flow but creating cash flow through the margin on each rental plus appreciation.
Long Term Capital Gains and other tax advantages also come into the picture on property owned for over 1 year. This becomes more and more important as you move up into higher tax brackets. Hope this is helpful.