As a real estate wholesaler, your success depends on locating properties in areas that rehabbers, or fixer-uppers and flippers, and landlords, or buy and hold investors, are buying, which will enable you to turn a profit.
However, to do so requires you to understand the ideal market conditions that make the best real estate markets for landlords and rehabbers, so you can provide them what they want.
Ideal Market Conditions for Wholesaling Houses
Though market conditions are subject to change at any time, for the most part, landlords and fix and flippers tend to buy properties in areas with investment potential. This includes areas where there is a growing population, which means people are relocating there and are on the search for housing.
Areas with a growing job market are also appealing to real estate investors because it means they have good economic activity, so there will likely be more homebuyers.
Likewise, areas with high rental occupancy rates mean fewer rental units available; hence, people will be more interested in purchasing homes.
It is also important to seek properties in areas with lots of inventory and historical appreciation because it means housing prices are rising, which enables everyone to make money.
That being said, let’s look at some of the best cities for wholesaling.
Top 10 U.S. Cities That Are Great For Wholesaling
Memphis and Chattanooga Tennessee
Tennessee is filled with big companies, and it also has a booming job market, which makes it a great place for migration.
Meanwhile, cities like Memphis and Chattanooga also have healthy property value growth, which makes them some of the best places for house flips with an average ROI of more than 100%.
Grand Rapids, Michigan
Grand Rapids, Michigan, is also ripe for real estate wholesaling. In fact, in 2020, many regions saw more than a 20% increase in housing prices, making it one of the most competitive markets in the U.S.
Jacksonville, Florida, has a large retiree population, which makes it a great place to find interested sellers who may be looking to sell their property to forego the upkeep. Hence, it is a vibrant housing market with lots of opportunities and an average house flip ROI of more than 80%.
Houston, Dallas, and Austin Texas
Houston, Dallas, and Austin Texas have a strong economy that shows no signs of slowing down, making these areas real-estate wholesaling friendly cities with house-flipping profits of more than 30% and 30%.
Pennsylvania enjoys a high demand for suburban homes, with properties being sold within 10-days of their listing.
Some areas are also seeing a rise in median home prices by more than $40,000 year to year, which makes it a great area for deals to be had.
Rochester, New York and Charleston, South Carolina
Rochester, New York and Charleston, South Carolina are other smaller cities with less competition and very good supply and demand.
These are just a few of the cities to begin your real estate wholesale search. However, if you are a real estate investor, try using Deal Machine, one of the best real estate investing software that easily connects you with prospective property sellers.