Wholesaling Townhouses

[Matthew T.]

I don't know if this question was answered but how would wholesaling townhouses work? The same as single family homes? It is advisable to wholesale these type of properties? Thanks!

[Craig P.]

Hey Matt,

Condos & Town-homes are much, much tougher to wholesale than SFR properties. Most investors will shy away from them, but I am sure you will find a few peopled who will buy if the numbers are solid. I personally wholesaled a few last year, and rehabbed and flipped a few.

Your numbers will have to be extremely solid. Look at what bank-owned ones are selling for in the same complex/area and how quick those are moving. You need to be below those prices by a considerable margin.

If you are negotiating with a private seller I would try to work it on an option agreement because of the uncertainty of being able to find the b-side buyer. I am very upfront and specific about my intent using the option contract.

"Mr seller, I will do my absolute best to move your condo/town-home, but please know there is a 50/50 chance of it working out. I will know for sure in 1-2 weeks of my marketing efforts. My plan to sell your unit is to work with one of my investor partners I have in town. I will make money on the difference between what we agree on, and what i sell it for to one of my investor partners. Worst case Mr. Seller is we spend 1-2 weeks at this and it doesn't work. If that happens we can re-look at our strategy."

Your buyer list needs to be a good one. I wouldn't bother unless you have a solid list of buyers.

Good luck.