Home Buying in Los Angeles>Question Details

Johnny Ziomek, Other/Just Looking in Los Angeles, CA

Is anyone flipping houses in LA?

Asked by Johnny Ziomek, Los Angeles, CA Fri Mar 7, 2008

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Answers

9
If they are flippin crazy. No, I'm sorry. It is very risky to flip homes in a declining market unless your flip can wait a few years.
3 votes Thank Flag Link Fri Jun 6, 2008
Hey Johnny
Yes they are. I just did a deal with a property purchased for 700k and sold for 1.1 mil a couple months later. You just have to be smart about it. I still think buyers see value in done done houses especially on the higher end. There are a lot fo short sales and REOs on the market but a lot of them are junky!

Best,
Monique Carrabba
3 votes Thank Flag Link Mon Mar 17, 2008
Very few. The more relevant questions is home many 2007 flippers are getting killed right now. A good percentage of short sales are flippers who flopped. A lot of novices jumped into the bubble to late in the game. It's easy to make money on a flip when prices are going up 20% per year. Much more difficult when prices are going down 10 - 15% per year. Newportfiji
2 votes Thank Flag Link Thu Mar 13, 2008
There are investors who are trying to "flip" immediately most sav vy investors are using this time to stockpile property in good areas for the future. The smart investors know that there are bargains to be had now and the rental market is good in your more desirable areas. Interest rates are still low but will be going up in the future so investors are taking advantage of low rates for 5-7 year holding periods. They will then go in and rehab the properties and put them on the market a few at a time.

However.. these are people with the financial resources to back them in case they need to wait for a period of time. If you do not have the financial backing to hold properties for at least 5 years I would not recommend trying this avenue of real estate investment. Successful flipping takes financial backing. If you are trying to do it on a shoestring budget you will probably be in trouble.
1 vote Thank Flag Link Tue Jun 10, 2008
Kaye Thomas, Real Estate Pro in 90266
MVP'08
Contact
Yes - I have a client who is buying a fixer in Downey. The house is more than half way done. Listed for $199k, 3 bed,2bath, 6,000 sq. ft lot. Estimated cost to finish $50k. He will complete the property and list for $375 to 400k in 3-4 months. So we have:

199k - original cost
8k -closing cost
50k - to fix
________
258K

To sell:
375k
minus closing cost - 8k
commission @7% -26250
__________________________
340,750
- 258,000
_________
82,750

You have to have cash to buy or put a good downpayment for this type of deals. Make sure you don't get greedy when sell the property, and trick to make this work is to sell fast and price the property to sell. Most importantly, Pay a good commssion to attract agents who can help you sell the property fast :)
1 vote Thank Flag Link Sun May 25, 2008
yes. I am.
In this market the only way you can do it is to buy low and sell low.
1. I search for homes that have been on the market for over 100 days.
2. I do the comp to narrow down the ones are at least $50k below market value (if the the seller is already lowing the price that means they are motivated).
3. I use 90 percent of the market value as the after repair value (90% because the market is coming down too quickly, I need to be sure that my flip will sell. Since it is lower priced and remodeled it will stand a much better chance.
4. I figure out the maximum offering price by subtract these expenses: acquisition, repair, sales, holding from ARV
5. I offer with this maximum offering price.
1 vote Thank Flag Link Sun Mar 9, 2008
Yes, they are but they are looking at short-sale and forclosure properties and are prepared to wait out the market until prices adjust. The key is finding an undermarket home in a good neighborhood .
1 vote Thank Flag Link Sat Mar 8, 2008
In this time, you should be very careful about where and how to filp--prices are going down in some areas. For instance in South Gate a home that sold in 2006 for almost 400K, just came on the market for 275$--bank owned of course.
You can search the MLS for free at my website http://reolicensedspecialist.com or email me and I can send you daily or weekly updates in the area you want to buy. All I need is your criteria: Price, area, features, etc.—and you will get daily or week updates directly from the MLS. I specialize in Foreclosures and I am a real estate broker for over 20 years.
0 votes Thank Flag Link Fri Jun 6, 2008
If you need more short sale info go to http://www.foreclosuremillionaires.com
0 votes Thank Flag Link Wed Mar 12, 2008
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