If you are a new investor, or are considering becoming a real estate investor, wholesaling and flipping are two great ways to get started.
Wholesaling real estate properties is a great way to quickly put some cash in your pocket. In fact some large wholesalers make 5 figure incomes monthly with 6 to 7 figure yearly incomes. The average wholesale fee of around $5,000 to $10,000 requires a large influx of deals coming through the pipeline to maintain stable cash flow on a monthly basis. Large deals – $20,000+ occur occasionally, but that is not the norm.
My business model does not incorporate wholesaling as a long-term cash flow strategy.
Fix and flipping houses is another way to make a large amount of money. Buying a house at a low price, upgrading or rehabbing the house, and then selling for a profit. The average profit for flipping a house using our system usually nets $20,000 – $25,000 profit after all the costs have been paid.
Occasionally a large profit just like in wholesaling can be realized. Our company recently turned a high 5 figure profit on a property. We also have the opportunity to realize a 6 figure profit on a high end home. However these are not the norm, but a nice occasional bonus.
We are involved in 10-15 fix and flip properties a year as a cash flow strategy. We have 6-8 rehab projects in the process at any given time. This model allows us to cash out properties on a regular basis.
Both strategies have pros and cons. I will discuss in the next Colorado Real Estate Blogger Blog.