What are property flippers doing in your area?
Back in February I wrote a post questioning whether it’s the time to abandon house flipping. And I really wanted to revisit this topic in a different light. I’m curious what house flippers are doing in the various areas across the country. Are they retrenching? Are they still buying/selling?
Im also interested in the strategies flippers are using to get their properties sold. What are you or your clients doing to move inventory?
For example- around here in Richmond, VA- flippers are still very active. Atleast the hardcore guys are. Starter houses are popular and are still selling. Some flippers are doing the basics and selling cheap…some are doing more and trying to sell for more.
I’m trying to get some ideas- I’d love for this to be a pseudo idea generator for getting inventory to move in slow markets.
buying cheap & mid flipping. bringing them up to rental standards with the intention of doing a higher remodel to sell when the market turns.
I think its a matter of just not going crazy. If you can get it cheaper you have more room to move. Regardless its about creating something that is marketable. Expensive is probably not wise unless your market can afford it.
mid-flipping- I like that term. Many of us are doing that around here too- buying for rentals with the intention of doing a higher remodel later.
Mike, were seeing investors use agents to option properties that are not currently listed but headed for foreclosure. They disclose to the bank that they are going to flip the property and immediately list it above the bank approved price. On the flip if they can make the spread then they make out! If they can't then they step out of some of the transactions and just let the bank sell it short and the seller can walk away in a better situation then just letting the home get foreclosed on.
PS -NBC aired a piece tonight confirming that sales are up 80% in our market from a year ago! you can see it on my blog if you're interested.
I work with a couple flippers and they have been stealing a property here and there, some are fixing them up to appraise for more and getting new financing on them and taking their initial cash plus some out and renting them out. Others are taking lower profits and selling them a good $20k under market just to keep some cash flow.
Take care!
RJH
So its looking like most people are doing similar things in all areas.
Garren- I like that idea- that's something I had not thought of. Hmmm...
Moved over to Multifamily. Not a big deal and they are still selling if the financing is there. The tax and foreclosure sales are booming.
Jack
We're still buying. All the money is made on the purchase so you need to be ever more careful and you need to price VERY agressively so you don't get stuck.
Andy- that's the stance we're taking also- we're negotiating even harder up front so we can price very aggressively.