Once you get familiar with the process of land flipping and are experienced in the world of real estate, you may ask the question “What is the difference between land flipping and wholesaling?”.
In this blog, we plan to go into the differences between flipping land and wholesaling homes and other real estate forms. To be clear – there is wholesaling LAND, but we do not do that. We flip land which is much more profitable for just slightly more work.
What is Wholesaling?
For those who do not yet understand wholesaling, it is the act of getting a property under contract and finding another buyer for that contract.
You can wholesale houses, multi-family properties, land, or any form of real estate. You would usually begin the process the same way as a land flipper would, by contacting property owners off the market and trying to get the property under market value.
You would then take this legal contract to purchase the property and bring it to someone who does want to purchase it and show them the market value of the property or slightly below to encourage a faster sale.
The wholesaler then profits from the difference between their agreed purchase price, and the final purchase price between the buyer and seller.
What Is Land Flipping?
Land flipping is very similar except after land flippers get the property for below market value they are then actually going to purchase the land. Also, land flippers are focusing exclusively on raw and vacant land rather than all types of properties. In land investing the properties are usually acquired 40-60% of market value which is lower than a typical wholesale deal. Leading to a higher potential profit percentage on the sale end.
What are the differences?
The main difference is the actual purchase and acquisition of the property. Wholesalers are not taking ownership of the property, just a legal document that allows them to purchase the property.
Land Investors do take ownership of the property, and then resell it themselves. This is a safer approach as you are not rushed to find a buyer for the property if you are not able to. You can sit on a piece of land for a very long time if you had to, which you do not usually have to.
The land also appreciates very consistently even in down markets for real estate. It is a much safer approach than wholesaling.
Land Investing and wholesaling offer a lot of potential individually and both can absolutely be run profitably. That being said there are key differences between the two and if you are interested in getting started in real estate you will need to make the personal decision on where you think is best to start. While you may sit on land for longer than anticipated at times, we have NEVER lost money on a single deal since we started Land Investing Online. This is very achievable, and we are no different from you.
There is a large list of benefits to investing in land, and we could only list a few of the best ones here. If you are curious about more, check out our discord to network with other land investors and flippers to get a better idea of what the business model offers and how they are doing.
Skeptical and have questions? Book a free 15 minute consultation with us now and we are more than happy to clear up any questions you may have.