Wholesaling real estate is a great strategy whether you’re a brand new investor looking to get your feet wet — or a seasoned investor looking for new ways to get more deals done.
It involves finding off-market properties that are being sold below market value, getting them under contract and then “flipping” the contract to a cash buyer.
Then you can then sell that contract to another investor for a slightly higher price — 5% to 10% more, in most cases.
When you do you get to pocket the difference between what you contracted the property for and what your investor purchased the contract from you for.
That makes a great model for beginners who want to develop their investing skills and seasoned investors who want to keep from passing up deals they may not be 100% sold on.
But that also leaves one major question:
What Is The Average Wholesaling Real Estate Salary?
The answer to that is: it depends.
Every wholesaler is going to be different.
From their personality, to their work ethic, their learning curve, the market they’re working in, the niche they choose, and a whole host of other factors all play into how much a wholesaler can earn.
As a quick, general guideline, here are the averages that wholesalers earn when they’re working for a larger investment firm that focuses on wholesaling, like the Wholesale Real Estate Partners firm based out of Scottsdale, AZ.
- Average: $106,453/year
- Low: $92,396/year
- High: $122,241/year
Keep in mind, though, that these averages are looking at people who are employed by a company, not necessarily solo operators — one-person businesses that wholesale properties either as a side hustle or as their main gig.
They also don’t take into account what’s possible when you start building a team, refining your systems, optimizing your operations, investing in consistent marketing, and treating the business like a business, rather than a side hustle that pays well.
The company you’re employed by will need to turn a profit while sustaining a large team of wholesalers. That means your commissions (and your salary) will be capped.
So while those salaries can be incredibly attractive, it’s actually possible to earn significantly more as a wholesaler when you become a solo operator and own the business, yourself.
How Much Can Real Estate Wholesalers Make?
Since the majority of wholesalers really only do a few to a handful of deals every year while working part-time, it’s hard to pin down exactly how much you can expect to make.
However, this business is incredibly rewarding and will give you back whatever you put into it as long as you’re staying consistent and always learning & improving.
To help you better understand what YOU can make as a wholesaler, think about the question in a different way.
Let’s look at two different numbers: your average commission per deal and dollar-per-hour earnings that are possible when you look at the industry averages.
For the examples we’re going to give you, we’ll assume that you’re treating the business as a side hustle, putting in around 10 hours per week (or 40 hours per month), and understand how to generate leads, start conversations, and get properties under contract.
This means you’ll be more efficient in your approach and will already have the learning curve and coaching portion of starting the business behind you.
Then, for example’s sake, let’s say the deals you’re finding are going under contract for $100,000 while leaving enough meat on the bones for your cash buyers to turn a profit.
An average assignment fee on a wholesale deal is between 5% to 10%, in most cases.
That means, for each deal you do that you get under contract for $100,000 and then flip the contract for 10% more, you’ll be generating $10,000 per deal.
If all you do is a single deal each month, you stand to earn around $10,000 per month in income which breaks down to around $250 per hour for a full 40-hour month.
If the market you work in has properties that are valued higher, say $200,000 per contract while making sure your investor can turn a profit, you stand to make $20,000 per deal — or $500 per hour for each hour you invest in the business.
You can start to see why it’s hard to project what you’ll actually make, but also get to see how dedicated wholesalers can earn a very healthy income.
And that’s for a solo operator who is treating their business like a side hustle.
If you start treating it like a growing company, focusing on building a team, implementing systems and operations to consistently bring in new leads and deals and monitor your KPIs, you can earn significantly more.
But, remember, this all depends on the area/market that you’re working in, what properties are selling for after renovations, and how well the market attracts cash buyers.
In a good market, like Washington D.C. or areas in California, property values are significantly higher than they are in Smalltown U.S.A.
That means the assignment fees — the difference between what you put the property under contract for and what your cash buyer paid you to purchase the contract from you — can be higher in those larger, higher value areas than the assignment fees you can earn in smaller towns with lower property values.
So, to answer the question: how much can real estate wholesalers make?
The answer is: it depends.
If you’re working with a well-established real estate firm, you can make anywhere from $90,000 to $120,000 per year, depending on the number of deals you do each year.
If you’re a solo operator doing 1 deal a month while working part-time, you can earn around $250 per hour — or $10,000 per month.
If you’re building a team of wholesalers who are all generating leads, closing contracts, and flipping those contracts, the business can grow as large as the markets you’re working in will allow you to grow and the potential to earn more is significantly higher.
If you want to increase how much you make as a wholesaler, there’s a few things you can do.
1. Increase Your Assignment Fee
Starting with getting a great deal is the easiest way to increase how much you can make.
The best way to do this is by understanding the market you’re working in, running comps, and then showing up to the negotiating table with that data in hand.
By being able to show your sellers what their property is actually worth — compared to other properties in the area — and then understanding what your investor could sell the property for, you can increase the spread between what you contract the property for & what you flip it for.
If you’re looking to dive deeper into how to do this, check out our guide on 5 Formulas Every Wholesaler Needs To Know.
That guide will help you understand both sides of the deal — from your seller’s point of view as well as the money your cash buyer will have in the property to bring it back up to market value.
Knowing these two figures will help you when it comes time to start negotiating so you’re able to get the property for the best price possible while knowing how much money is in the deal for your investor after they renovate or repair it.
Then, you can use both figures to dial in your wholesale real estate contract to maximize the spread — and how much you’re able to make off the deal.
2. Do More Deals
Once your contract is dialed in and you’re familiar with the spread on each deal, the next way to increase how much you can make is by simply doing more deals.
There’s a few different ways you can do it, too.
The first is through Virtual Wholesaling.
With the virtual wholesaling strategy, you’re able to unlock markets you wouldn’t normally have access to because you’re doing everything virtually — online from the comfort of your office.
The process works the same way: you find off-market properties, put them under contract, and then reassign the contract to an investor who closes on the deal.
Except there’s a slight twist: you’re using software to locate these deals, perform due diligence, and can get them under contract without ever physically visiting the property.
To learn more about this strategy, check out our Virtual Wholesaling guide.
The second strategy is by finding your own off-market properties.
Getting away from the MLS and generating leads for properties before other investors and agents can get their hands on them can be a goldmine for your business.
Through consistent marketing and utilizing a wide range of marketing strategies, you can bring in highly-motivated seller leads that aren’t being poached by dozens of other investors, wholesalers, and flippers.
If you want to get away from the MLS and generate more leads for your business, check out our guide on Finding Off-Market Properties. It shows you 10 different strategies you can use today.
Finally, the 3rd way to get more deals done is by refining the data you’re marketing to.
Many investors like to blanket an area or zip code with the same old, tired message.
“We buy your house fast!”
Smart investors, though, know that the money is actually in refining those lists and stacking the data so the messaging can be hyper-targeted to the seller’s specific situation.
Take, for example, a property owner who is absentee, with a vacant property, who is also facing foreclosure.
A message with “We buy your house fast!” may work to get some conversions in that case. But a message tailored to working as a foreclosure specialist, buying fast, and eliminating their expenses on a vacant property will be far more effective.
Using direct mail to get in front of these targeted sellers is a great way to generate more leads — and get more deals done every year.
We’ve put together a guide that breaks down some of the best mailing lists for wholesalers you can use to uncover the highest motivation levels in your sellers for your direct mail campaigns.
3. Reverse Wholesaling
Reverse wholesaling is similar to the wholesaling strategy except you’re finding buyers for the properties before you actually find the sellers.
This strategy works great when you’ve built relationships with investors in your area, know the exact types of properties they’re looking for, and how much they’re willing to spend to buy them.
To learn more about it, read our guide on Reverse Wholesaling.
4. Qualify Your Leads with Better Marketing
Most wholesalers are generating leads by either picking up the phone and cold calling or by driving for dollars then looking up information on the owners of distressed properties they find.
If you want to make more money, though, you’re going to want to have leads coming to you — and pre-qualify them before they get to you so you’re spending less time working through each lead and more time speaking directly to motivated sellers.
To do that, you’ll want to use a strategy like direct mail marketing. It is still one of the most effective ways to generate more pre-qualified leads for your wholesaling business.
To see how (and why) it’s so effective, check out these real estate direct mail statistics.
Then, as you’re building your direct mail campaigns, remember that there’s two main goals you have: make your messages stand out and make sure they’re hyper-relevant to your sellers.
To do that, you can use postcards like the ones below.
They’ll stand out in your seller’s mailbox and appear handwritten so you’re able to send more pieces every month without having to write them all out by hand.
To make these campaigns as effective as possible, you want to make sure you’re including messaging that is relevant to where your prospects are at.
Use the list filtering and data stacking we mentioned earlier and then tailor your message specifically to the lists you’re mailing to.
For instance, if you’re mailing absentee owners who are delinquent on taxes and have vacant properties, you can touch on the problems they’re facing, the objections they’ll have, and how you’re able to work around their unique situation to get their home sold fast.
Those messages will bring in highly-qualified, highly-motivated sellers so you can spend less time on the phone or driving for dollars — and more time getting contracts signed.
The amount of money you can make as a wholesaler greatly depends on the strategy you’re using to get deals done.
If you’re employed with a company you can make a healthy salary but the real money is being made as a solo operator or when you start building a team.
As a solo operator or business owner, though, those expenses fall in your lap and need to be considered when you start running the numbers and figuring out how many deals you can get done each year.
Some of the expenses you’ll encounter are things like the software you use to manage and optimize the business, the time you spend inside of the business, and the cost of employing a team when/if you build one to help you grow the business.
Then, you have to factor in your marketing expenses.
To save money on those and lower your cost-per-call, you’ll want to subscribe to a service like our postcard sequence or greeting letters. When you subscribe, you can save over 20% on your monthly marketing costs — putting all that cash back in your pocket.
Each of these campaigns have been proven to convert between 1% to 1.5% — which translates to 10 to 15 calls for each 1,000 pieces sent — compared to 0.2% to 0.5% that most investors experience with their direct mail marketing.
That means you spend less time cold calling, less time driving for dollars, and more time speaking with pre-qualified leads who want to talk to you about selling their property.
All of that adds up to giving you more time to lock down contracts — while saving money at the same time. A win-win if you’re looking to make the most money as a real estate wholesaler.