$100,000 reason to wholesale houses and NOT rehab!

We bought this house and land (1.2 acres) to do a development project. We planned to develop the site and build a high rise of 44 units. We then changed this to 15 townhomes. Eventually we were forced to rehab the 3,300
sq ft house that was on the site that was built in 1894. In all we lost about $100k on this deal. Out of 250 deals this is the only one I’ve ever lost money on. I am sharing this with you in a humble way to show you we can
all make mistakes and in hopes you to learn from mine.

Our mistake in this project was trying to implement a real estate investing technique that we knew very little about- development. We could have wholesaled this deal at the time and made $25,000. Instead I was greedy. I
would encourage you to start with wholesaling and always stick to it as a base line strategy. Reason being- no liability, money out of your pocket, or risk. Think about how many wholesale deals you could do in the time it will
take you to rehab one house. My argument is you can make more then twice as much then rehabbing a house in that period, and have an easier life with less liability. Take it from someone that has rehabbed a TON of houses.

It took us 6 months to rehab this house (payment $2,800 for 24 months! ouch) and a ton of unexpected costs. We had to install an extensive basement water drainage system inside the basement and out and run all new plumbing, skim and patch the ENTIRE house, paint, electric, trim, hardware, new lighting, re-finish hardwood floors, 4 new bathrooms and a new kitchen and extensive landscaping AND a new driveway! Make sure to follow my blog to the right here as I can make SURE you avoid future pitfalls like this!

Happy Investing!