Hawaii Pre-Licensing National Practice Exam

A real estate "wholesaler" is an individual who identifies a property that is often under market value and secures it under a purchase contract. They do not actually take ownership of the property itself; instead, they sell the contract to another buyer, typically an investor or someone looking to flip the property, for a profit. This practice allows wholesalers to benefit from the difference between the price they secured the property for and what the end buyer pays.

This method requires a strong understanding of the local real estate market, negotiation skills, and the ability to find motivated sellers. Wholesaling is a strategy often used by those looking to enter the real estate market with limited capital, as it doesn’t require them to finance a property outright.

In contrast, the other choices pertain to different roles within real estate. A licensed real estate agent facilitates transactions for buyers and sellers but does not engage in wholesaling unless they are also operating in that capacity. Developers are focused on creating new properties, which is very different from the wholesaling process. Similarly, investors owning rental properties are involved in long-term property management and investment, rather than the short-term transactional nature that characterizes wholesaling.