House Flipping on the Decline as Home Prices fall

House Flippers, beware as foreclosure investing becomes more risky with declining values and increasing inventory.

When available real estate inventory increases at such rapid pace, you might end up sitting on a property for much longer than in the past. This eats your profits and can quickly turn into a negative investment.

In a recent article by Amber Lester titles "Flipping houses loses its appeal as market cools" she covers some details of this same exact scenario.

She states:

"The news from the real estate world has been bleak since interest rates started rising, with investors or “flippers” taking a big hit. Flipping is the practice of buying a home to resell quickly, sometimes renovating it before sale. The past few years had been good to investors, who were able to buy fixer-uppers and sell them within days to shoppers caught up in the feeding frenzy. Now, with houses sitting vacant for months, flippers are starting to retreat."

My take on this is to be very careful in the foreclosure flipping market and be sure of the turn over times and inventory volume before jumping into a deal.


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