House #48 was a small and average house on a big lot in a decent area of town, we originally bought it and planned to make it a rental house. The lot seemed good on paper but in realty it wasn’t easily to expand the property or subdivide the property, so we decided to attempt to wholesale the house while it was in escrow. The good news was the house needed very little work and was as close to turnkey as anything we buy.
We are a bit different than your average wholesalers. As we are looking at purchasing properties we are focusing on two strategies: renting it or retailing it. If we put too many houses under contract we start thinking about wholesaling.
For whatever reason (probably the reasons I mentioned above) I couldn’t get any investors very excited about this house.
At this point most wholesalers would cancel the contract and abandon the deal. Because we do not want to damage the relationship with the REO company that sold us this deal we decided we would do a minor rehab and try to sell it.
The good news is we sold it just before the New Year, our profit ended up being about 4x what the wholesale profit would have been so it turned out to be a winner. This deal really had all of exit strategies in it: wholesaling didn’t work, retailing did and renting it for nice cash-flow was an option available to.