Darrin - you and I go back a few years now and have done some business together. As you know, I have wholesaled my fair share of properties over the years.
Real Estate Investing today is a team sport, and you have to pick what position you want to play. I hear (and read) far too often today about new investors, ones just starting, who want to "get into wholesaling." Ask them why, and you'll hear vague reasons that are obviously something they picked up from the latest "seminar" that just blew through town or "training" they bought on the internet or hanging around the water cooler. The "seminar" guys who promote it are actually promoting their "secret systems" for you to buy from them to find sellers that cost $5,000 but if you buy now, you can get for $2,997 payable in 3 monthly installments. When that happens, hang onto your wallet!
Any of those sources make it sound so easy...like there are hungry buyers out there just waiting around for someone to come into their lives and offer them a property, and those people will magically buy it as though they are under a spell. (After 10+ years wholesaling, I am still looking for those people :-))
You wouldn't go to your eye doctor to have your gall bladder removed. Nor would you have your gall bladder removed by a doctor who said, "you know, I've been a general practitioner, but I think I want to get into surgery. Mind if I remove your gall bladder for you?"
I gravitated to wholesaling because I became so good at acquiring property, I had more than I could handle and starting sharing my deals with associate investors who were glad to get them.
The point I am making is that I don't think wholesaling is a place you start. I think it is a place you end up.
The place to start is decide on your financial goals and pick the best way for you to get there:
Decide if the best place to get there is to buy distressed property, fix and hold for a rental or fix and retail.
Decide which neighborhoods. They all have their trade-offs. Lower income neighborhoods cash flow the best but have a higher maintenance tenant base. If you have the discipline to manage tenants in those areas it is a good living. If you don't think you do, either hire a good property manager or move up a tier or two, but realize when you do, your NOI drops the higher you go in demographic.
However, you aren't in this business to trade dollars and appreciation isn't so hot these days. You have to create value, and that may take a little experience doing the lower tier properties first to realize how to create it in the higher tiers. (Successful builders of tract homes didn't start there - they gained experience and ended up there.)
If you have skills and a few good trades people, you can do well buying distressed, fixing, and retailing homes. Do it well, and you can turn 4 to 5 a year just on your own with a few strong backs and weak minds to help you. There's good money in that, too.
If the reason a person says they want to get into wholesaling is to "learn the business" or "learn the market", they were given bad advice. The best way to do either is to bird-dog for someone who is experienced, learn from them, and then acquire strategically to achieve your goals capitalizing on your bird-dogging experience. Bird-dogging requires little out-of-pocket. The only risk in bird-dogging is your wait time and a little gas money.
Real estate investing is a marathon not a sprint.
