Investing in wholesale property definitely has its good points, but it has its bad points just as well. You can obviously see the upside. Investing in real estate at mere pennies on the dollar is what we are talking about now. So, what is the downside, you ask?
It sure sounds wonderful to be able to invest in a property for $30,000 that is valued at a minimum of $100,000. Imagine that you had to invest in a hundred properties in order to take advantage of such a deal. That would cost you at least $3,000,000. Does it still sound like a good deal to you?
Buying In Bulk
Of course, if you happen to have three million dollars just lying around the house, you should definitely take the deal. This kind of deal is what is known as a bundle. Bundles are popular ways to get the lowest possible wholesale price. Big time lending companies come up with these bundles if they are having a difficult time moving properties one at a time or if they simply have an excessive number of properties and need to get things moving. More and more of this type of deal are becoming available now with the global economy in its current condition.
In addition to the $3,000,000 price tag, most likely the investor will have to have the cash on hand to pay for the wholesale property. Bundles are auctioned off and sold to the investor who bids the highest dollar amount. The must have the money to pay as soon as they win the bid.
The quality of wholesale property is more often than not whole. If you invest in one wholesale property or if you invest in ten wholesale properties, you can almost bet that the condition of the property you purchase will most definitely be less than average.
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Tags: buying real estate wholesale, Property, property options blog, wholesale property, wholesale real estate
{ 2 comments… read them below or add one }
Hi Sean,
Wow! Everything is cheaper when you buy in bulk. You don’t normally think about buying houses in bulk. But, I can see that it has a huge potential for profit if you have the money to buy upfront.
Unfortunately, I think it’ll be a while before I have the money to do this.
Is this what helped aid to the GFC? It would be great to have a spare 3M under the pillow to purchase a ‘bundle’. Perhaps finding one hundred people with a spare 30k and getting them together to buy a bundle would be ok..mmmm…or 10 with 300…how many houses are we talking?