Pricing a wholesale deal so it sells

Work backwards, always

Start from what the finished house sells for, take off what the work costs, take off what a buyer needs to make for the risk, then take off your fee. What is left is the most you can pay. Working forwards from what the seller wants is how people end up with contracts nobody will take.

Give the buyer a real margin

A flip buyer is generally looking for somewhere around 20% of ARV between their all-in cost and the resale, and a rental buyer wants a number that still cash-flows after debt service. Squeeze that to 10% and the deal does not sell, no matter how good it looks to you. Your fee comes out of what is left after their margin, not before it.

Be honest about the rehab

Under-scoping is the most common way a wholesale deal falls apart. You send it out at $25,000 of work, the buyer walks it and says $45,000, and now the price does not work and your credibility is dented for the next one. Price the scope you actually saw.

Price the speed you need

If you need to move a contract in five days rather than fifteen, that is a discount, and it is better to take it deliberately than to discover it by watching the clock run out. Everybody in this business knows what a short fuse is worth.

If it is not moving, it is the number

Three days with no serious interest is information. The market is telling you the price is wrong, and the options are to renegotiate with the seller or to take less. Re-sending the same deal to the same list a fourth time is not one of the options.

Leave yourself somewhere to go

Contract at the absolute maximum and you have no room to move when a buyer comes in five thousand light, which they will. Build a little slack into the number you agree with the seller and you keep the ability to close a gap rather than lose a deal over it. The wholesalers who struggle are usually the ones who won the contract by overpaying for it.

Know what the last three sold for

Not asking prices, not what somebody told you at a meetup: what actually closed in that pocket in the last ninety days, and in what condition. That is the number a buyer is checking against, so it is the number you should have checked first. Everything else is a story about the market rather than the market.

Your fee is the last thing in, not the first

Decide the buyer's number first, then the seller's number, and take your fee from what genuinely remains. Wholesalers who start from the fee they want and work outwards end up contracting too high, and then spend three weeks trying to sell a deal that never had room in it. A smaller fee on a deal that closes beats a larger one on a contract that expires.

Rehab estimates are a pricing input, not a sales tool

Every thousand dollars you shave off the scope to make a deal look better is a thousand a buyer adds back on the walkthrough, and they add it back with interest because now they distrust the rest of it. Price the work you actually saw. If the deal only works with an optimistic scope, it does not work.