How to Wholesale Real Estate in Florida

Florida offers more than just sunshine, beaches, and year-round warm weather; it’s also full of profitable real estate investment opportunities. This is great news if you’re looking to wholesale properties.

What makes the Sunshine State such a lucrative market? For starters, it’s a top destination for retirees, vacationers, and people looking to relocate. Plus, the average home price here is much lower than in other states such as Massachusetts and California.

If you’re not familiar with real estate wholesaling in Florida, don’t worry, as this guide will walk you through the steps required to get started.

Key Summary

Florida’s growing population and strong economy create a high demand for real estate.
While wholesaling is legal in Florida, the state has stringent laws on real estate transparency.
You can find wholesale properties on Florida Realtors and other real estate websites, as well as joining any of the state’s many real estate investment groups.
Profits for wholesaling property in Florida can be up to 20% on one contract or even higher in cities such as Miami or Tampa.

What is Wholesale Real Estate?

Wholesale real estate is a process where an investor or wholesaler identifies properties available at below-market prices, often due to the seller’s urgency or a property’s distress.

The wholesaler then enters into a contract to purchase the property. However, instead of buying it, they sell the contract to an end buyer for a higher price. The wholesaler profits from the difference between the contracted price and the resale price.

What Are the Key Benefits of Wholesaling Real Estate in Florida?

The advantages of wholesaling real estate in Florida include:

Florida’s growing population and tourism industry create a high demand for real estate.
Wholesaling in Florida requires minimal upfront capital and no need for credit or loans.
Wholesaling deals in Florida can often be completed quickly.
Florida’s strong economy and favorable tax environment make it an attractive market for real estate investors.
Florida offers a diverse range of properties, from vacation homes and condos to single-family homes.

Step-by-step guide to wholesaling real estate in Florida

Step 1: Performing Market Research

First, identify areas with significant investor interest, increasing property values, and strong rental demand. Also, perform a market analysis to examine recent sales of similar properties in your target area to understand current market prices.

Florida Realtors offers statewide and local market statistics, trends, and insights into real estate markets across Florida. You can use this site, as well as national sites such as Zillow, Redfin, and Realtor.com to perform market research.

Step 2: Developing a Buyers List

Compile a list of potential investors who are interested in buying wholesale deals. The best way to find buyers is by attending local real estate investment meetings, participating in online real estate forums, and connecting with real estate agents.

Some of the top Florida real estate investment groups include:

You can also use social media, real estate websites, and email marketing to attract potential buyers. Just be sure that your buyers have the financial capacity to close deals swiftly.

Step 3: Locate Florida Wholesale Real Estate Deals

Find properties that are underpriced or require significant repairs. There are many ways to accomplish this, including:

Driving for Dollars: Drive around neighborhoods to spot distressed properties.
Direct mail campaigns: Send postcards or letters to property owners.
Online listings: Browse websites such as Florida is Home, realMLS, Zillow, and RE/MAX.
Public records: Check foreclosure notices (for example, for Miami-Dade County, visit miami-dadeclerk.com), probate records at the local Clerk of Courts, and tax lien records by visiting a local Tax Collector or Property Appraiser website (for example, The Hillsborough County Property Appraiser).

Step 4: Assess and Evaluate Properties

Determine the potential value and costs associated with a property. You can do this by conducting a thorough walk-through or hiring a professional Florida home inspector. Be sure to obtain quotes from Florida based contractors to estimate the cost of necessary repairs.

Step 5: Secure the Property Under Contract

Obtain a purchase agreement with the property owner. Discuss price, closing timeline, and any contingencies with the seller. Also, ensure the contract includes an assignment clause allowing you to transfer your rights to another buyer.

Step 6: Promote the Contract to Your Buyers List

Find an interested buyer to whom you can assign a Florida wholesale real estate contract. Your contract should include property details, photos, repair estimates, and the overall property value.

You can promote your contract by distributing flyers to your buyers list and scheduling a time for potential buyers to view the property.

Step 7: Assign the Contract

Once you’ve found a buyer to assign a contract to, transfer the purchase agreement to your end buyer, and make sure your assignment contract outlines the terms of the transfer. Also, obtain a deposit from the end buyer to secure their commitment.

Step 8: Finalize the Deal

Lastly, complete the transaction and receive your assignment fee. Ensure all paperwork is processed and funds are disbursed correctly. Then, collect your assignment fee once the deal is closed.

Top 5 Areas for Wholesale Real Estate in Florida

Ybor City, Tampa

Ybor City is a historic district known for its vibrant culture and historic architecture. The neighborhood has been undergoing revitalization in recent years and has attracted a mix of young professionals, artists, and entrepreneurs.

This influx of new residents and businesses has increased property demand, making Ybor City a hot spot for real estate investors. Wholesalers can find opportunities in the form of older properties that need renovation.

Wynwood, Miami

Wynwood is renowned for its artsy vibe, with numerous art galleries, street murals, and trendy cafes. The neighborhood has seen rapid gentrification, transforming from a neglected industrial area into a thriving urban hub.

This transformation has created a dynamic real estate market with high demand for residential and commercial properties. Wholesalers can benefit from the area’s popularity by targeting properties that can be flipped or sold to investors.

Downtown Orlando, Orlando

Downtown Orlando is the city’s central business district. It features a mix of commercial, residential, and entertainment properties. The area’s continuous growth and development is driven by new businesses and infrastructure projects.

As a high-demand area, you can find plenty of lucrative opportunities by identifying underpriced properties that can be sold to developers or investors looking to capitalize on the downtown area’s expanding market.

Springfield, Jacksonville

Springfield is one of Jacksonville’s oldest neighborhoods, known for its historic homes and tree-lined streets. The area has seen a resurgence in recent years, with many historic properties being renovated and new businesses moving in.

This revitalization has made Springfield an attractive destination for homebuyers and investors. You can find opportunities in the many historic homes that require restoration.

College Park, Orlando

College Park is a charming neighborhood known for its lakes, bungalow-style homes, and proximity to downtown Orlando. The area’s unique character and convenient location have made it a desirable place to live.

You can find wholesaling opportunities in older homes that need updating. Buyers may be interested in the area’s blend of suburban tranquility and urban convenience.

Is Wholesaling Real Estate Legal in Florida

It’s perfectly legal to wholesale real estate in Florida. However, it must be done correctly to comply with state laws. You must be careful not to act as a real estate broker unless you are licensed, as this can lead to legal issues.

Additionally, wholesaling real estate in Florida is perfectly legal as long as you’re not violating the state’s laws regarding unfair and deceptive trade practices (Chapter 501). That means staying transparent in all contract representations and wholesale transactions.

Is a License Required to Wholesale Real Estate in Florida?

Florida doesn’t mandate a real estate license for wholesaling, as long as you are acting as a principal in the transaction.

Under Chapter 475 of Florida Statutes, a real estate license is only required if you’re selling a property directly, listing or marketing a property for sale, or leasing or renting real estate.

This means you must have a contract to purchase the property and then assign that contract to another buyer.

However, engaging in activities that resemble those of a Florida real estate agent, such as marketing a property you don’t own or have under contract, may require a license. Plus, you must state whether or not you’re a licensed real estate agent in your contract.

Is Wholesaling Properties Worth it in Florida?

Typically, wholesalers earn money through assignment fees, which range from $5,000 to $20,000 per deal. In competitive markets such as Miami and Tampa, these fees can be higher.

The profit margin for wholesalers usually falls between 5-10% of the property’s selling price. For example, a property sold for $200,000 could earn a wholesaler between $10,000 and $20,000.

Active wholesalers who close multiple deals per month can see substantial monthly earnings. For example, closing 3-4 deals per month with an average fee of $10,000 can result in $30,000 to $40,000 in monthly earnings.

On the other hand, part-time wholesalers may earn $5,000 to $10,000 per month. While beginners may start with lower fees, earnings potential increases with experience and market knowledge.

Bottom Line

Florida presents a golden opportunity for real estate wholesalers, due to its diverse properties, growing population, and favorable economic conditions.

By following the steps outlined in this guide, wholesaling in the Sunshine State can be a highly rewarding venture. So, dive in, capitalize on the opportunities, and watch your real estate portfolio flourish.