From the BiggerPockets Blog

 BiggerPockets Blog »

Jump to Forum View All

Click a category below to view different forum categories.

BiggerPockets

General Info

BiggerPockets Q&A, Site Questions, & Announcements

1504 topics, 14360 posts — Last Post 04/16/14, 07:25AM

BiggerPockets Exclusive PRO Area

116 topics, 834 posts — Last Post 04/15/14, 11:19PM

New Member Introductions

10845 topics, 85239 posts — Last Post 04/16/14, 11:49AM

Real Estate Success Stories

391 topics, 6094 posts — Last Post 04/16/14, 09:57AM

General Real Estate

General Real Estate

Buying & Selling Real Estate

5901 topics, 46551 posts — Last Post 04/16/14, 11:57AM

Renters

640 topics, 5788 posts — Last Post 04/15/14, 06:49PM

Get Foreclosure Help - Help Stop Foreclosure Forum

316 topics, 2557 posts — Last Post 04/16/14, 03:58AM

Home Owner Association (HOA) Issues & Problems Forum

236 topics, 1602 posts — Last Post 04/13/14, 02:11PM

Do it Yourself

653 topics, 6257 posts — Last Post 04/16/14, 09:21AM

Reviews & Feedback

Real Estate Deal Analysis and Advice

3652 topics, 29310 posts — Last Post 04/16/14, 11:37AM

Real Estate Guru, Book & Course Reviews and Discussions

1129 topics, 11532 posts — Last Post 04/16/14, 09:34AM

Ask About A Real Estate Company

736 topics, 7286 posts — Last Post 04/15/14, 02:45PM

Real Estate Investing

Real Estate Strategies

Wholesaling

5583 topics, 43641 posts — Last Post 04/16/14, 10:51AM

Rehabbing and House Flipping

3320 topics, 30886 posts — Last Post 04/16/14, 11:43AM

Real Estate Development & New Home Construction

551 topics, 4678 posts — Last Post 04/14/14, 01:02AM

Innovative Strategies

698 topics, 5991 posts — Last Post 04/13/14, 06:35PM

Tax Liens, Notes, Paper, & Cash Flows Discussion

863 topics, 6653 posts — Last Post 04/16/14, 08:56AM

Rent to Own a.k.a. Lease Purchase, Lease Options

689 topics, 4851 posts — Last Post 04/16/14, 11:39AM

1031 Exchanges

142 topics, 1050 posts — Last Post 04/16/14, 09:31AM

Foreclosure Investing

General Foreclosure & Pre-Foreclosure Forums

1686 topics, 11281 posts — Last Post 04/15/14, 03:20AM

HUD, VA, and Tax Sales

414 topics, 3085 posts — Last Post 04/14/14, 06:29PM

REOs

1212 topics, 10563 posts — Last Post 04/15/14, 01:08PM

Short Sales

1533 topics, 13117 posts — Last Post 04/15/14, 07:10PM

Landlord & Tenant Forums

Landlord & Rental Property Questions

7186 topics, 70487 posts — Last Post 04/16/14, 11:59AM

Mobile Homes & Mobile Home Park Investing

636 topics, 5127 posts — Last Post 04/15/14, 09:59PM

Investor Basics

Starting Out

7673 topics, 60254 posts — Last Post 04/16/14, 11:57AM

Investor Psychology

430 topics, 6092 posts — Last Post 04/14/14, 06:53PM

General Real Estate Investing

4709 topics, 37142 posts — Last Post 04/16/14, 10:57AM

Real Estate Investor Marketing

1728 topics, 14072 posts — Last Post 04/16/14, 11:07AM

Commercial Real Estate

Commercial Real Estate Investing Forum

1408 topics, 8970 posts — Last Post 04/16/14, 08:17AM

Multi-Family and Apartment Investing

1101 topics, 9163 posts — Last Post 04/16/14, 11:59AM

The Business of Real Estate

Real Estate Technology and the Internet

Real Estate Technology, Social Media & Blogging

638 topics, 4883 posts — Last Post 04/15/14, 01:41PM

Business Basics

Goals, Business Plans & Entities

827 topics, 7526 posts — Last Post 04/15/14, 07:32PM

Real Estate Finance & Legal

Financial, Tax, and Legal

Tax, Legal Issues, Contracts, Self-Directed IRA

2781 topics, 19974 posts — Last Post 04/16/14, 09:42AM

Property Insurance

308 topics, 2039 posts — Last Post 04/16/14, 10:10AM

Personal Finance Discussion

328 topics, 2690 posts — Last Post 04/16/14, 11:45AM

Loans, Mortgages, Credit Lines

Private & Conventional Lending Discussion

2823 topics, 19658 posts — Last Post 04/16/14, 11:16AM

Creative Real Estate Financing

1206 topics, 8758 posts — Last Post 04/15/14, 02:21PM

Crowdfunding Real Estate

35 topics, 455 posts — Last Post 04/14/14, 02:14PM

Real Estate Professionals

Real Estate Professionals

Real Estate Agents

1204 topics, 7944 posts — Last Post 04/16/14, 11:23AM

Bankers, Lenders, and Mortgage Brokers

440 topics, 1917 posts — Last Post 04/15/14, 07:37AM

Contractors

261 topics, 1656 posts — Last Post 04/16/14, 06:23AM

Local Real Estate

Local Real Estate

Local Real Estate Networking & Recommendations

1981 topics, 11555 posts — Last Post 04/16/14, 11:16AM

Americans & International Real Estate

161 topics, 566 posts — Last Post 04/14/14, 11:19AM

Foreigners Buying in the USA

62 topics, 409 posts — Last Post 04/10/14, 06:27AM

Canadian Real Estate

64 topics, 426 posts — Last Post 04/16/14, 08:34AM

Marketplace

Real Estate Marketplace

Real Estate Marketplace

14981 topics, 53853 posts — Last Post 04/16/14, 10:47AM

Real Estate Events and Happenings

162 topics, 2426 posts — Last Post 04/16/14, 11:36AM

Off-Topic

Off Topic

Off-Topic

2901 topics, 32397 posts — Last Post 04/16/14, 10:12AM

Housing News & Real Estate Market

913 topics, 8335 posts — Last Post 04/16/14, 10:58AM

BiggerPockets Real Estate Investing Summit

97 topics, 1751 posts — Last Post 04/10/14, 02:27PM

BiggerPockets Resources

Forums » Rehabbing and House Flipping » Flipping future

Flipping future

16 posts by 14 users

Signup

Real Estate Investor · Tempe, Arizona


Another thread brought up the best cities to flip in, and some of the responses pointed to the areas that were hit hardest by foreclosures. My question is where do you guys see the future of flipping business in those areas going when the level of foreclosures decrease? Several top contributors on this site operate in those heavily distressed areas, and do 10, 20, or 30 deals per year. Well when foreclosure levels decrease do you expect your amount of deals completed to decrease as well?

How do you plan to combat those issues, will you expand your network, move to a new location, expand your marketing, or some other innovative strategy?



Real Estate Investor · Grand Blanc, Michigan


The market is already changing in Michigan. Going "shopping" on the MLS for the next best flip is all but behind us. The competition is more fierce and the deals aren't as lucrative.

As a result, I'm changing how I acquire properties. The REOs were good to me, but there are other avenues. Since I don't plan on changing markets, I have to change my acquisition strategies. (besides, in talking with several BP members at the Summit, I get the sense that these challenges are virtually nationwide).

The next best strategy, as I see it, is to direct market to private owners. These would be distressed owners who have building code violations, out of town landlords, driving neighborhoods to find vacant homes, owners who have filed for divorce (work with local divorce attorneys), Sheriff Sale properties which are in redemption with equity, and target homes which are tied up in probate.

These are just some of the ideas I've come up. As long as the rehabbers adapt to the new landscape, flipping will still be lucrative.



Developer · Orlando, Florida


Seems like flipping will always be a viable option as long as you buy right in whichever state the market is in. It does seem pretty unlikely that people will be able to keep up the volume of deals as the market shifts, but in a sellers market the deals should become more profitable.

Another good option once the scales tip is to build specs. It's a low stress business ( as long as you don't over leverage and can sell your product ).



Residential Real Estate Agent · Colorado Springs, Colorado


I agree with all the posts on here. In Colorado Springs, CO we are seeing almost no REO's on the MLS. And if there are any, they are getting bid up so high by owner occupants or investors paying too much! I used to do a full rehab where I replaced everything, I just did a test on a house and did a light rehab but have it on the market for less. So far it's working out and I'm getting showings and 2 interested in submitting an offer.

I think investors are going to have to change their strategies and adjust to the market. Direct mail is what I have been doing to accumulate short sale deals. This way I'm in full control of the deal and don't have any competition and no up bidding. My profits are much bigger.

There are always going to be deals out there, investors are around in a good market and bad market. We just need to adapt to the changes and change our acquisition strategies. Right now I'm trying to buy up as many cheap short sale's as possible for rentals before the short sale market disappears, but that won't happen for 3 more years or more.


Small_pink_realty_logo-michelleMonica Breckenridge, Pink Realty
E-Mail: [email protected]
Telephone: (719) 277-7465
Website: http://www.PinkRealty.com
#1 Realtor in Colorado Springs, TOP 1% Nationally ~ Owner of Pink Realty® Franchise


Real Estate Investor · Tempe, Arizona


Some good replies on here I thank you all for the information you put out. It seems like two of you are pushing the marketing route more, and I like your idea of marketing to get short sales Monica. The stats according to a blog by Steve Cook hints that the short sale secret is out. I like the fact that you are working to get them before they show up on the MLS. Do you know of any good posts that explain the process of finding, and negotiating short sales in more detail?

Like all of you have said I don’t see the market for rehabbing disappearing; however I do see it shrinking due to competition. And I would imagine that those investors that are/were completing 30+ deals a year may have to scale back. I would imagine they would be innovative enough to increase profits to balance the decrease in deals though.




It's tough out there. It seems like there is more competition out there than ever and less inventory. Shortsales and sheriff sales seems the most viable option.



Real Estate Investor · Garland, Texas


In 2004 and 2005 there weren't many foreclosures, but flipping was very popular and competitive. Yes, prices were rising rapidly which helped make it idiot proof. The next environment will have it's own twists, but will still offer opportunity. Though, perhaps without the same volume as now. That may be good though, if the profit per deal increases. In another thread people are saying spec building is offering more profit now. That may be a good way for rehab/flippers to go.


Jon Klaus, SellPropertyFast
E-Mail: [email protected]
Telephone: 214-929-6545
Website: http://www.facebook.com/Buttermilks


Developer · Orange County, California


Jon, a few weeks ago we tied up a lot in Lake Forest, CA, and put it in escrow (it's the ONLY lot available for sale) We drew up some preliminary plans, made up a brochure and put up a "take one" box, not even a sign, just to guage interest. We're now in contract to build a new house! REO's around here are for the most part all gone. Good deals are snapped up fast. Orange County CA is one of the most affluent in the country, and unemployment here is around 7%, with high median incomes, great educational system and every conceivable entertainment available, making it popular for investors, etc.

We will be building more spec buildings, from SFR to Office buildings in well located areas, should anyone be interested!


Karen Margrave, Parlay Investments, 1st American Construction
E-Mail: [email protected]
Telephone: 949-933-3955
Website: http://www.parlayinvestments.com
PARLAY: definition: to increase or otherwise transform into something of much greater value


Real Estate Investor · Asheville, North Carolina


Adjusting your strategy is important, but it's also important to reassure yourself about the fundamentals.
Will people always get into financial troubles? Will they always need to move, divorce, or inherit a house? Are houses degenerating every day form the day they are built? Will people always defer maintenance? Will interior trends and even functions always change? Yes! So flipping will always be around.



Real Estate Investor · Charlotte, North Carolina


Are there certain areas in a city that you may think will be the next to rebound? Here in Charlotte I am doing that right now. Lot of old family homes that have just been passed down in a protected historic district that some of us are picking up and renovating.



Rehabber · Riverside, California


Because of the robo-signing issue and the proposed Homeowner Bill of Rights, California has seen a huge decline in REOs. With government policy aiming for write downs, it's hard to imagine any clarity until after the elections. Actually, we do an event where we have representatives from government, the Mortgage Bankers Association, NAR, and the Appraisal Institute, all didn't expect to see much progress until after the elections. (See isurvived2011.com, it free online in video format)

That being said, it's about someone moving your cheese. If REOs don't work, we go back to dealing with sellers directly or becoming builders. We have many friends moving away from REOs and short sales and sending mailers to homeowners again.


Small_tng_webAaron Norris, The Norris Group Hard Money
E-Mail: [email protected]
Telephone: 951-780-5856
Website: http://www.thenorrisgroup.com
The Norris Group l www.TheNorrisGroup.com


Real Estate Investor · Springfield, Missouri


The future of flipping is good! Flipping takes in a pretty big swath of strategies, IMO, anything that involves acquiring an interest (in whole or in part) and turning that inventory is flipping.

Regulatory constraints are attempting to slow the process, eliminate some strategies and provide more consumer safeguards. Disclosing a purchase price and time held is not that big of a deal when you are really adding value in the market.

I'm not a fan of specialization in any method to acquire inventory, like foreclosures, a good investor can acquire a quality property from any source in the market and buy properties that aren't really identified on the market, for example; from an aging landlord who you spot cleaning out a rental or a wharehouse that has been empty for years. You need to be able to hunt to eat well in RE!

I've never seen a property that could not be improved in some aspect that would increase value. Your future in flipping will be determined by your ability to see how a property can be acquired and changed or remarketed for a profit. Think outside the box!


Financexaminer@real estate investor dot com


Real Estate Investor · Asheville, North Carolina


@Jim M. If you were asking me that question, I'd say it's a continuation of the trend over the last 15 yrs of close in city neighborhoods (that are at least relatively safe). We have no unsafe areas like in larger cities in NC. Also under and up to the median price homes. In our area it's under 200K. It slows down until 400K is pretty dead. Historic areas can be in there!

I just put my in city rehab on the market on friday (3/1 1135sqft 187,500) and have one cash offer and another one coming this evening. Yay!

The burbs have a bit longer to go. My parent's neighborhood in Durham's burbs has moved solidly from all professional to (solid safe) blue collar in the last several years. So my guess is closer and cheaper wins. Gas is killing land prices out of town (usually desirable due to mountain views).



Wholesaler · Chicago, Illinois


In my opinion, there will always be plenty of deals to flip, no matter if we’re in an up or a down market. Yes the amount of available deals will decrease as the housing market gets better and foreclosures decrease. However, there will always be an abundance of motivated sellers. People will always have situations where they need to sell their home quickly. Therefore, I believe flipping is a great short and long term strategy.



Real Estate Investor · Springfield, Massachusetts


Flipping is alive and well, you just have to adjust to what the market is giving you.

I've heard all this talk about no inventory and no deals, but we've bought 12-13 properties since February 1st. The majority were private seller deals but there were still 4 REO's in the mix.

There are still plenty of distressed sellers and lots of short sales out there. You just have to go find them!!



Residential Real Estate Agent · Hattiesburg, Mississippi


I'm seeing a whole bunch of shadow inventory that just won't come on the market..... Makes me sick seeing the homes just sit there deteriorating.... Overgrown shrubs, backed up gutters, etc, etc... Fortunately they will be outside the scope of owner occupants and that could lead to some great cash flow opportunities..

I'm trying to get lean and ready to soak up everything I can....

If it weren't for the wifey I would unload my personal home and live at my office/apartment in order to increase my borrowing ability...





Sign up