Is this a good time to flip houses?

Asked by Nicole, Chicago, IL Tue Mar 4, 2008

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11
Stacy Karel, Agent, Chicago, IL
Tue Mar 4, 2008
I my opinion no...unless you acquire a property at 50-60% of value- then you can make $$ in any market. The market time to sell is just too long unless you can sell substantially below the competition. It is a great time, however, to pick up investment properties to rent.
Web Reference:  http://www.condochicago.com
3 votes
Emerson Wagn…, Agent, Urbana, OH
Tue Mar 4, 2008
Its a good time to buy. Plan on holding the property for a couple of years to maximize your profits. Also, consider that all of these people losing their homes to foreclosure are going to need to rent in the next couple of years. This may be a good time to consider becoming a landlord. When the market comes back strong you can sell.
2 votes
Dave Muti, , 07054
Tue Jun 17, 2008
Although it appears that there are great deals to be had, my advice for the average person is to stay on the sidelines and leave investments in the real estate market to the professionals. My reason for this cautionary approach is that I do not believe we are close to a bottom in the market. Second, I also believe that today’s real estate market is reminiscent of the early 90’s. People who bought houses in 1989 and 1990 thinking they got a bargain that they could turn in a year or two were surprised. Then, real estate values did not come back for about five years and I predict a similar story today.
Today’s market is a little more complex then it was then because inflation is becoming a bigger concern and that means that interest rates will rise. This coupled with the recession we are in (yes I believe we are in one and it will be long and hard for the average American) and the flood of properties coming on from foreclosures will keep the values down for some time to come. Unless you have a significant cash reserve to carry you through three to seven years I would stay away from purchasing investment properties. If however, you are looking to buy a primary residence or even a vacation home then yes it could be a good time to buy?
While as stated above I believe the market will further decline, you will find yourself in a Catch-22. If you wait you may not have the same programs available that are currently offered due to guidelines changing weekly as well as pending legislation that will make getting loans more difficult. In addition as pointed out above, I believe that interest rates will not improve much and if inflation rises so too will interest rates and there in lies the conundrum.
Moral of the story, if you want to buy a new home for yourself I would go for it; sellers are anxious and will bite at any reasonable offer. Even if the market declines you are not going to be selling any time soon and you need a place to live so you might as well enjoy the tax benefits of home ownership. If however you want to get into the real estate investment game I would leave that one for the pros.
1 vote
ian cockburn, Agent, New Orleans, LA
Tue Mar 11, 2008
Yes! The catch is...you better have experience. This is still a time to make alot of money...especially on duplexes or more, but not the time to compete with those who have 20 yrs of experience(making mistakes), and can physically do the work when the particular work to be done is beyond the budget....such as knowing how to install sheetrock, repair plumbing and so on.

Like I tell so many would-be investors...you can't build a house on a spreasheet...no matter how you stack the printouts.
Web Reference:  http://iansellsnola.com
1 vote
Dave Eisley, , Dupage County, IL
Mon Mar 10, 2008
To flip houses: NO. Unless you are extremely handy and can keep your costs way down. Remember, real estate is a LONG TERM investment. The last 10 years have made people forget that. Buy, Hold, Rent, and Sell in 5 years.
1 vote
Accurate Ins…, Other Pro, Chicago, IL
Tue Mar 1, 2011
Since you are asking the question, the reasonable assumption is that you aren't experienced in flipping. Based on that the answer is NO.
There are a lot of seemingly good deals on the market. However many of those deals are nearly as good as they seem once you factor in the actual condition of the home and what it will take to get it to reasonable occupancy status.
Don't believe the hype/infomercials. The days of flipping are over for anyone but the most experienced Pro's. It is extremely rare that a deal doesn't die when I inspect a flipper house for a client. The work is always garbage, non-compliant and sometimes unsafe.
More for your situation, who's going to buy the POS, will buyer's be able to get financing, will these properties be in neighborhoods someone wants to actually buy in?
Web Reference:  http://www.aic-chicago.com
0 votes
Jeremy Butts, Both Buyer And Seller, Louisville, KY
Mon Feb 28, 2011
My guess is that housing values will continue to decline, so be SURE you can buy very low and sell very fast!
However, rents are not likely to slip (in my estimation), so if you find discounted property - why not rent it? Or put somebody in with a lease-option?
Best regards,
Jeremiah
http://www.FlipsInFocus.com
0 votes
Evan, Home Buyer, 60614
Tue Jun 17, 2008
Lol, from what I have seen and read it's pretty difficult to sell right now. I'd assume that unless you are planning to buy extremely cheap and sell cheap be ready for your money to sit there for a while.
0 votes
Larry Story, Agent, Greensboro, NC
Tue Jun 17, 2008
Nicole,
This is not something to be thought about without alot of research and being prepared. Although I will say that after the FHA lifted their ban on financing homes that have been owned for less then 90 days it might make it easier to sell a "flipped" home I have included a link to the article off of the HUD website that outlines the plan.

Hope this helps,
0 votes
Chris, Home Buyer, Illinois
Tue Jun 17, 2008
Flip a house in this market, HA!

Flipping means that you buy low, put a little money into it to make it presentable then sell it as FAST AS POSSIBLE. In this market, no way are you going to sell as fast as possible.
0 votes
Brian and Dan…, Agent, Chicago, IL
Tue Mar 11, 2008
You make your money on the buy, so as long as you can acquire the property at a price well below market, there is potential to make money. Have a budget, and most importantly, stick to it, as it can be easy for the "little things" to add up. You'll want to study the local market to determine which improvements fetch the highest return on investment for that particular area. Also, be prepared to price the property slightly below market when it comes time to sell, so that it can move quickly and you are not stuck with carrying costs.
0 votes
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