House Flippers Back on Market

House Flippers Back on Market

“The house flipping frenzy of the mid-2000s, glamorized on TV reality shows such as “Flip This House” and “Flipping Out,” helped drive prices to unrealistic heights before the housing bubble burst. Since then, investors paying cash for distressed properties have been credited with helping the real estate recovery.” – The Chicago Tribune

Although real estate prices and interest rates have started to increase, they are still dramatically low and they’ve fueled a renewed fascination with renovations and flipping for the past several years. However, large private funded companies have been buying homes to rent out and with rising prices the market is slowly changing. According to a report from RealtyTrac house flipping increased 19% year-over-year across the nation in the first half of 2013. The last half of 2013, investors and individual house flippers are finding inventory to be difficult. Investors are looking for creative ways to buy available and lower-cost properties and in auctions, foreclosures, or short sales. Single-family houses are not the only thing that slippers are looking for; apartment buildings and complexes are part of the mix as well. Commercial buildings may also be lumped into the renovations and Flipper mentality especially for those large companies that have applied for loan modifications, failed and now have filed for bankruptcy or foreclosure.

Something that investors may not be aware of is the ability to approach a homeowner long before the foreclosure auction. This can be done at any time once the property goes into default. According to the report by the Chicago Tribune, “you could buy a delinquent note from the bank at a discount and take over the home loan, essentially becoming the lender, and eventually foreclosing on and reselling the property at a profit.”

Other options from the report include buying the home from the lender immediately after the auction in what’s technically called a trustee sale. If no one bid on the home it simply goes back to the bank. This is the time for investors to snatch it up since lenders and underwriters do not like to have real estate on their books.

You can also snatch up the home from another investor who may have been successfully on the property at the auction. This is called an on the spot flip.

There’s much to the business of flipping and auction buying and investors should block themselves into one type of buy. With so many creative options and resources, those that are flipping properties are finding ways to make a killing.

Want to look at flipper-type homes in Bonita Springs? Call us today! We have the inside scoop.