Simple Math Question - Flipping/Wholesaling
Just say I have a house under contract for 314k and it has a potential to sell for 430k after 30k of repairs.
That is 86k gross profit after repairs.
What I want to do is assign the contract for 5 - 10% of the potential profit which is 4300 - 8600.
Am I right or should my fee be 5 - 10% of the profit after closing and realtor fees, etc?..which is more like 2150 - 4300 if you assume 6% realtor fees and 4% closing costs.
What is the typical percentage or guidelines you pros use for your assignment fees anyway?
Some feedback will be useful.
Thanks, Jeremy
Is this a hypothetical question, or do you really have this property under contract?
If this is a property you already have under contract, you can always try to wholesale it for a $5K assignment fee.
If you have the resources, with these numbers, you would do better to buy the property, do the rehab, then resell the property at a discount to ARV (perhaps $395K) to induce a quick sale.