Wholesale Real Estate

Definition

Wholesaling is a real estate strategy where the wholesaler signs a purchase contract with the seller, then assigns that contract to an end buyer for an assignment fee. The wholesaler typically never takes title — the closing happens directly between original seller and end buyer, with the wholesaler's assignment fee paid at close. Wholesale fees range from $5,000 on small-scale deals to $50,000+ on institutional-quality deals. Wholesaling is regulated state-by-state — some states require a real estate license to wholesale, some require disclosure to all parties, some prohibit it without title transfer.

Worked example

Wholesaler signs a $200,000 purchase contract on a distressed property with a 30-day inspection period. Markets the contract to a flipper for $215,000. Flipper signs an assignment for $15,000. At close, $200k goes to seller, $15k to wholesaler, and the flipper takes title. Total cost to flipper = $215k (purchase + assignment fee).

How DealIntel uses it

Wholesale fees are line items in DealIntel's MAO formula and the 70% rule calculator. Deals where wholesale fee inflates effective purchase price above MAO are flagged by the kill list before underwriting proceeds.

Related terms

• The 70% RuleA fix-and-flip discipline that caps the maximum allowable offer at 70% of ARV minus rehab and costs.
• After Repair Value · ARVThe estimated market value of a property after planned renovations are complete.
• Earnest Money Deposit · EMDA good-faith deposit a buyer puts down with the offer — typically 1–3% of purchase price — held in escrow until close.

Matt Abadi is the founder of DealIntel. He leads the development of the platform's six-strategy underwriting engine, 25-point Kill List, and Monte-Carlo financial model — the institutional analysis stack DealIntel applies to every fix and flip deal. DealIntel was founded in 2025 with the central thesis that knowing when not to invest is the most valuable number on the page.