Click Here

REALTORŪ Magazine Online: The real estate professional's business support tool.

OFFICIAL MAGAZINE OF THE NATIONAL ASSOCIATION OF REALTORS®

Daily Real Estate News  |  May 19, 2010  |   Wholesalers Flip Houses, Distorting the Market
Real estate investors, who call themselves wholesalers, are snapping up distressed properties, often paying all cash and seeking a discount, preferably from a cash-strapped home owner.

Then the real estate wholesaler flips the homes often so fast that he never takes possession of the title. Instead, he signs a contract with the home’s owner and then signs the contract over to a new buyer for an “assigning fee” the wholesaler’s profit.

"Wholesaling is finding a bargain for a bargain hunter," says Michael Jake, a Colorado-based real estate investor.

Critics of the practice say it makes it harder for lower-income families to take advantage of a down market, not only because good deals are snapped up quickly but also because the practice distorts the market.

"It makes the bottom [of the market] very frothy and hard to figure out where real value is," says Andrew Jakabovics, associate director for housing and economics at the Center for American Progress, a Washington, D.C., think tank.

Source: Christian Science Monitor, Tracey D Samuelson (05/17/2010)

Browse all of today's news
E-mail this page to a friend
Give us feedback

Search news
Launch my search
 
Subscribe to news
Subscribe to News
Daily and weekly real estate news, trends, NAR press releases, convention coverage, plus exclusive features and columns.

RSS Feed
Get the Daily Real Estate News delivered straight to your desktop or news aggregator. (New to RSS? Learn the basics here.)
 
 
SHARE YOUR INSIGHTS
How did you sell it?
Tell us how you overcame hurdles to sell a challenging or very unique listing!