US house 'flipping' slows

  • 11 years ago
  • Uncategorized

A report has shown that fewer real estate investors in the US are buying houses and then selling them on six months later at a profit (‘flipping’), as the specialists were finding it harder to spot a good investment.

The number of investors buying property to then flip it fell 35 per cent from the second quarter and was down 13 per cent from the third quarter in 2012, reports.

Flipping became popular again after the property crash when speculators saw opportunities in the fluctuating prices. This drop in flipping is largely due to the gradual rise in property prices in the US, making the investments more risky.

The data compiled by RealtyTrac also revealed that three quarters of all high-end flips took place in the five markets of New York, Los Angeles, San Francisco, San Jose and San Diego.

Daren Blomquist, vice president at RealtyTrac, told that increasing home prices over the past 18 months combined with decreasing foreclosures have created a market less favourable to the high quantity of middle- to low-end flips that they saw late last year and early in 2013.

Mr Blomquist said: “But the sharp rise in high end flipping indicates there is still good money to be made for flippers willing and able to take on the additional risk of buying and rehabbing more expensive homes.”

Compare listings