What is the difference between wholesaling and flipping?
A wholesaler sells the contract and never owns the home, while a flipper buys the property, renovates it and sells it to a retail buyer. Wholesaling needs less capital and carries less risk per deal but earns a smaller fee; flipping needs funding and renovation work and keeps the whole profit.
Many flippers buy from wholesalers, so the two are connected. A wholesaler’s job is to bring a flipper a deal that is priced so their numbers work.
Side by side
- Capital: wholesaling needs little; flipping needs purchase and renovation funds.
- Risk: a wholesaler’s risk is the deposit and marketing spend; a flipper also carries repairs, holding costs and market changes.
- Time: wholesale deals close in weeks; flips take months.
- Profit: a wholesaler earns a fee; a flipper earns the spread after repairs and costs.
Common mistakes
- Pricing a wholesale deal with no room left for the buyer’s profit and costs.
- Taking on a flip without funding for the full renovation and holding time.
More questions
Should beginners wholesale or flip?
Wholesaling needs less capital and teaches you to find deals and run numbers, which flipping also needs. Flipping adds renovation, financing and market risk on top.
Can you wholesale and flip at the same time?
Yes. Many investors flip the deals that fit their skills and budget and wholesale the rest to other buyers.
Which makes more money per deal?
Flipping usually earns more per deal because the flipper keeps the spread after repairs, but it ties up money for months and can lose money. A wholesale fee is smaller but arrives at closing.