Wholesaling Real Estate in 2012: A Year in Review

How has wholesaling real estate been for investors in 2012 and what should be expected as we move into 2013?

A lot has changed in the housing market during the last year and significant shifts in trends and several major events mark a new era for the U.S. real estate market. So how will this change the game for next year for those wholesaling real estate in 2012?

The Game Changers Affecting Real Estate in 2012

There have been some monumental events during the last year which will definitely continue to have a big impact on the housing market and investors.

This includes the massive mortgage settlement we saw early in the year which may not have done much to help individual homeowners, but has given banks more confidence, unblocked the foreclosure pipeline and helped to shore up local government short falls.

The huge surge in private equity funds flooding the residential real estate market and scooping up masses of REOs has certainly had a big impact on investors and the housing market as a whole. It has been frustrating for the few who have found these funds bidding on their doorsteps but it has also helped to bring balance to inventory levels.

Then there was the devastation of hurricane Sandy which has certainly affected those limiting themselves to wholesaling real estate in the northeast during 2012. For some it has had horrific consequences, while others have been making the best of it.

Finally the presidential election weighed down the market and kept capital from flowing due to the cloud of uncertainty hanging over the country. Not everyone got the result they hoped for, but now that there is clarity, capital is beginning to move more freely, much of which is going into real estate.

Where Does the Market Stand at the End of 2012?

While foreclosures have remained rampant during 2012, and some markets just really began to feel the pinch of the foreclosure crisis in the second half of the year, there have been dramatic improvements in the market.

Some sensational claims by pessimists seeking media attention have said it could be years until the housing market turns around. Yet, data from NAR shows rising house prices in 81% of major U.S. cities with the national average property value increase up 11% since 2011.

Those wholesaling real estate in 2012 saw an average profit of $20,000 to $60,000 according to recent news coverage, though many investors obviously consistently make far more on each deal.

Ultimately we are now standing on a well-balanced market, with healthy inventory levels, rising prices and rising home sales.

Peeking into the Future of Real Estate Investing in the U.S.

Looking forward, real estate investors ought to expect great things in 2013.

There will still be many foreclosures to come and the future of short sales may not be clear but mortgages should gradually ease and a wave of capital moving into and increased appetite, or at least tolerance for risk, promises healthy spreads and high volume levels for those flipping houses in the New Year.

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