Posted by phil fernandez on May 24, 2007 at 18:53:55:
Sure if you buy right. But you gotta buy right and then be able to sell below the market.
Flipping - Posted by AL
Posted by AL on May 24, 2007 at 18:08:02:
Is Flipping working anywhere? Thank you for your input.
Re: Flipping - Posted by Bill Jacobsen
Posted by Bill Jacobsen on May 25, 2007 at 10:54:27:
Yes, flipping is working in my part of Oregon. There are some changes in this market. First, houses to flip are as available as ever. There are more foreclosures but banks are tightening up just becuase of the volume.
On the sale side, I believe you must rehab the house to a higher standard so it stands out in a crowd. Retail buyers can demand a house in pristine condition. You can’t count on the 4-5% appreciation to occur in the three months you hold the house to bail you out. Be conservative on your comps.
Bill
Re: Flipping - Posted by Rich-CA
Posted by Rich-CA on May 25, 2007 at 01:09:15:
Just did some property walkthroughs for houses that needed rehab. You have to know what the CMAs are for the property. I only look at “pending” sales, because these are ones that actually attracted a buyer. The “actives” or “asking price” properties that are pretty far from the “pending prices” are more like wishful thinking than a sales price - ignore these. If they are too high, don’t even bother to look.
Then you have to put together an initial budget before you make an offer, include holding costs while work is being done, include something for your time, include a margin for errors. Based on that you determine what you can pay and make money. Then you need to guess at what they might accept as an offer (I use Days On Market to see how motivated they might be). If the offer amount is at or below the amount you figured you needed based on your costs - buy. Otherwise - next house.
Based on what I have seen, there are parts of Phoenix where this is working (very low end neighborhoods) and I saw potential in Colorado from the large number of REO properties on the market.
Re: Flipping - Posted by LK
Posted by LK on May 24, 2007 at 20:02:51:
Everywhere that the investor buys right based on conservative ARV and well estimated costs keeping a good handle on the whole process.
Re: Flipping - Posted by William Flood
Posted by William Flood on May 24, 2007 at 19:49:25:
Phil,
Several states are still good markets; Texas being among them. In any location, it’s a function of what price you are buying. The “Flip That House” method which generally entails buying too high, but putting in Travertine and Stainless Steel appliances isn’t working, and really was only good in that crazy seller’s market. It’s all about getting a wholesale price.