We still Wholesale in South Carolina

Happy Friday everyone,

If you have been keeping up with RE Investing news or social media at all you have probably heard about the new law in South Carolina “making wholesaling illegal.

I won’t dive into the details, there’s TONS of media/content breaking it all down already so just do a quick google if you want do dive into it more.

We also dive into it on a recent Collecting Keys Podcast episode so you should definitely check that out as well.

It passed about a month or so ago, and since SC is a primary market for us we were a TAD nervous, but also decided to push our luck because the penalty was relatively low for a first time offense (Like $500).

People have been abandoning the market, and many companies actually pivoting their businesses away from wholesaling all together in anticipation of this becoming a new pattern federally across more states.

The thing is though, this is the perfect example of the Warren Buffet saying to:

“Be fearful when others are greedy and be greedy when others are fearful”

With every hurdle being thrown into the Wholesaling industry, the weak operators are culled which just boosts the opportunities for those of us willing to figure out the new rules of the game.

In SC specifically there are currently 3 strategies we are aware of/have been utilizing.

1. Find a closer that doesn’t care about the new rules and just lets you do your thing 🙂 
   -This has been our current situation but we recognize this could expire so we are keeping on our toes in case things need to pivot.
   

2. Wholetail/double close everything

   -A large part of the law comes down to marketing deals you don’t have equitable interest in. Taking things down before monetizing can help alleviate that but obviously you need capital which is an extra complexity.
   

3. Sign Lease Options/Land Contracts with sellers with short timelines

   -We have NOT played with this yet, but it is an interesting strategy. Basically these arrangements give you equitable interest in the property which TECHNICALLY allows you to market to sell it. I think the conversation with a seller would be weird but I think this could definitely work.

Overall as we have 4 deals in SC in Escrow This Month and are seeing lead flow start to rise, I think any state that moves to “Ban Wholesaling” does nothing more than become a new hot spot for those of us who are willing to find the ways to make things work.

Be smart. Learn the rules. Learn to bend them. Watch the money roll in.

And accept that you might get slapped with a little “hey dont do that!” but understand that is the risk we have for playing in the grey 🙂 

Would love to hear your thoughts on my Instagram!

Have a great weekend everyone,

-Mike