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FIND YOUR DREAM HOME OR APARTMENT
must-see on msn
Do your homework first. The only way to make money by flipping in this market is if you are absolutely positive you're at the bottom of the market .
The next condition is if you know that some new job creation will be happening soon in the affected area.
Stay away from McMansions unless the seller is ready to give them away. They're expensive to heat and maintain. The taxes will kill you.
The bad news, except for certain areas, this market has not bottomed out and shows little sign of doing so until (or if) the entire economy recovers.
Everyone was greedy with cheap money, now Karma has everyone on the run.
ALL: My apologies. The first line was supposed to read " Thi**** home..."
Beach: FHA, HUD, and the Banks have a pro owner occupied agenda. They additional place deed restrictions that prohibit the transfer of the property for 3-6 months. Another way to prohibit investors. a home does not qualify for FHA financing until it has been owned by the current owner for 91 days. This is referred to as the 90 day "Anti-Flipping" rule. FHA has waived this, but they actually require 2 appraisals (the second by the lending bank which generally comes in low). Still this is anti-flipping, and truley anti-investor. The banks however, can foreclose on the home (thus the home has changed ownership) and sale the property with FHA funding in less than 90 days. without the need for the second appraisal. This industry is full of double standards and anti flipping measures that have been instituted by FHA, Banks, the federal or local government.
I was shocked Phoenix wasn't on this list. (Maricopa County) They industry is large out here with a high number of available propeties and a strong flipping environment.
Where to begin?.?.?.?.?
Thi**** home to me because this is exactly what I do. I FLIP houses. In 2010, I closed 60 FLIPS on my MLS alone. There are 3 of us REALTORS in my office and we closed 115 total last year. These are just the properties we list for our investor clients. We purchased over 300 homes at trustee sales, for our clients. Some (very few) were used as rentals, and most were resold on the open market for a profit. It has proven to be a great investment for cash buyers. I will be the first one to say that my clients are making a lot of money and that is the primary reason for doing this. If you have the means to do this, you might find that there is not a better way to invest.
All of that being said, There is considerable risk to investors buying these properties. There is a 12-15 hour window to decide what home to invest in, and at what price. In that time, we determine a comparable market value for the home, have title check the chain of ownership to ensure the property being purchased is clear, and drive the home to quickly evaluate all material fact (5-10 minutes) that we can see about the condition and quality of the home and neighborhood. After all information is gathered the investor will put in a bid to us and we have our bidders at auction bid. If the investor wins the auction (highest bid), they now have basically 24 hours to pay off the balance of the property. This is not a comfortable way to buy a home. There are numerous homes that are occupied by owners or tenants at the time of auction. There are laws that must be followed, and occupied homes can slow down the flip process. The longer the process takes, lower the annual rate of return for an investor. Some homes are stripped clean of cabinets, fixtures, A/C's, Pool equipment, etc or just vandalized, Bids have to be based on the value of the home minus the rehab costs, realtor fees, and profit. It is not inexpensive to flip a home. Unseen problems with the home can often eat into profits. We offer our services to investors. We help investors avoid the pitfalls and reduce the risk of flipping homes. My main point is that this is not a sunday walk in the park. There is tremendous risk and everyone works hard to minimize this risk. Anyone who is willing to risk $30,000 to $1,000,000 (and even higher) deserves to turn a profit. While some deals are a huge success (or a HOME RUN as we call them), most are humble returns on the investors investment capital.
I understand there were numerous mistakes done by property flippers to help create the Housing Market collapse, but EVERYONE is to blame. BANKS, INVESTORS, LENDERS, LOAN OFFICERS, REALTORS, HOME SELLERS, APPRAISERS, and HOME BUYERS. I am sure I missed numerous parties with responsibility here. As a nation I fear we have lost accountability for our decisions. Everybody wants to be the victim or pass the blame to the other side.
Currently, I have kept numerous contractors and handyman, with steady jobs and income for the last 2-3 years. We hire staff to manage every step of the process. These are jobs that strengthen the Phoenix economy. It is not a small operation fueled by greed. Additionally, we are thanked daily by home owners in neighborhoods. They thank us for improving their neighborhood and home values by fixing the busted up blight of a house and flipping it into a beautiful family home to a new homeowner. I won't say it is "community service," but it is not something that warrants the scrutiny and criticism that I have read.
So if you want to help improve home prices, help create jobs, help families by a home to be proud of, earn a fair income for your family, invest for your future, lessen crime and improve the economy... FLIP HOUSES!!! Do it intelligently and use a professional in the industry who can help you make smart decisions. It's the perfect risk reward scenario that can build some financial security and help improve the community.
Properties don't go into foreclosure because there are people wanting to flip them, folks!
By the time a foreclosure home actually goes on the market, the people who once owned them are long gone - the process takes months. There's a house on my street that has sat empty for almost a year due to a foreclosure and it isn't on the market yet. I can guarantee you that I would much rather see somebody buy that house, fix it up a little and put it on the market than to have it continue to sit there vacant. That's not taking advantage of somebody else's failed dream; it's keeping a neighborhood from falling into decay.
I'm reading comments about how little effort goes into flipping a house and how greedy it is to profit from somebody else's loss. I suggest that before you jump to those conclusions you look into what it costs to buy a foreclosure, repair it to meet building codes and put it back on the market. I haven't done that, but DH and I completely remodeled our 30-year old home by ourselves (no contractors) and I can tell you it is costly and it is a lot of hard work. I've looked at probably close to 50 foreclosure homes in our town and only one or two would pass occupancy inspection without spending some significant money and doing a heck of a lot of work. I've seen placed where the plumbing has been ripped out of the walls, bare wires were left hanging, carpet torn out, tile shattered into tiny pieces.
What is so wrong with taking a place like that and making it into something a family could actually live in and selling it for a fair profit?
"There are some homes that are first put on the market for a period of time for owner occupied buyers." Are you sh**ting me? There is no provision for the bank to do so. Then since when do banks care for the general population over investors? Give me a break. Some comments here are totally zoned out or by flippers. I don't trust NAR or the money hungry rich people.
I have tried to post a message that informs the readers but msn won't allow it. I suppose the words are all spelled correctly so they think it is an automated message or spam. If the reporter would do their job and explain why these houses can be found at such a good price instead of trying to upset people about evil investors perhaps everyone would understand why this is a good thing but msn will not allow it.
I have been involved with flipping as a realtor and represented many investors that are doing this with foreclosures. It quickly gets the foreclosures off the market and the homes are being repaired and remodeled and then returned to the market for fair market price. Although they are being sold the first time around cheap..it's because the house is in need of repairs. Not everyone can afford to purchase a home and do the repairs. And we all know the banks are not going to do any. They seldom do the maintenance on the home like grass cutting and maintaining the pool. Most banks will not even keep the power and water on! There are some homes that are first put on the market for a period of time for owner occupied buyers...the time usually expires before an offer comes in...therefore the investors are sitting and waiting. This flipping is risky..but if you have a "good" realtor that knows the market..then there is A LOT of money to be made for the savvy investor!
Excuse me Mr. Keynes for I have to now switch the wording around on this quote become some automated spam bastard has flagged this message as not being allowed. Is capitalism the astonishing belief that the nastiest motives of the nastiest men somehow or other work for the best results in the best of all possible worlds?
----John Maynard Keynes
I thought your comment was pretty interesting Megand. I tried Capitol Hill for a while. A similar situation in the same time frame was happening out here on the Olympic Peninsula for me. Fortunately, I kept my fences mended in Hawaii for wintering and got out of the contract in 2005 as things rose to the 2008 crash. Same green, sustainable, over priced cha-cha hybrid car crowd out here. Who's dog is bigger, ha-ha. I liked some of you comments, very funny. Get in touch with me if you want to try Chile or Argentina! Bosold Photo at You Tube. Warm winters on the other side of the equator!
"everyone's end is someone else's new beginning"
Foreclosures are opportunities.
I have to disagree w/Orlando daddy. Flippers come in only after the deal goes bad for whatever reason. Flippers help to reduce the glut of homes on the market, flippers are a major factor in stabilizing home prices, they create jobs, generate taxes and revenue and get houses back on the market. If you think that its easy money, go ahead and try it! Banks hate flippers because flippers refuse to pay more then the property is worth. If banks sold houses for what they are worth, the banks would be insolvent and would have to shut down. The greed and hubris that has been exposed on wall-street and through-out the financial and banking industry is what caused the economic melt-down and housing crisis, but they didn't lose their house, retirement or job. They still have all those things AND they are receiving bonuses in the hundred million dollar range. Stop blaming flippers for their American ingenuity and ability to make lemonade. Write your congressman and demand that he/she introduce legislation to tax the hell out of the hedge fund and derivatives industries, there is more money there then anyone even knows!