“This is not a get-rich-quick business. This is a grind-it-out business. But once you know how to do it, you only have to commit resources when the price is right.”
-Robert Fahn, house flipper
“A year ago, bums outnumbered bidders at the courthouse steps [where foreclosure auctions take place]. Now the bums are way outnumbered.”
-Sergio Rodriguez, house flipper
Here is an interesting development that fits into nicely into our recent discussion that foreclosures are a net positive to the economy.The return of the flipper, foreclosure edition.
“During the U.S. housing boom, even amateur investors could buy and sell a property within a couple of months and turn a profit. Today there’s nothing amateur about house flipping.
Homes with punctured walls and missing appliances draw multiple offers from professional investors at auctions in foreclosure-ridden states such as Arizona, California, Florida and Nevada. Competition is so stiff that experienced flippers such as Sergio Rodriguez and Brian Bogenn look back with nostalgia at last year, when they turned over 48 residences in the Phoenix area.”
In Phoenix, 4,661 foreclosed homes changed hands within six months of being purchased in 2009, an increase of 81 percent from the year earlier, according to RealtyTrac Inc., which sells foreclosure data. Flips in the California counties of Riverside and San Bernardino rose 45 percent to 17,203. In Las Vegas, which has the highest foreclosure rate in the country, they climbed 38 percent to 8,042.
Nationally, flipped homes gained 19 percent to 197,784 in 2009. Final figures may rise because some homes bought in the fourth quarter may get flipped this year, said Daren Blomquist, a spokesman at Irvine, California-based RealtyTrac.”
Oh, and on Feb 1, the Federal Housing Authority issued a one-year waiver of anti-flipping rules.
Fascinating stuff . . .
House Flippers in U.S. Crowd Courthouse Steps in Hunt for Deals
Bloomberg, March 31 2010