Flip Flopping in Sonoma County
PD says Flippers are Flopping in Sonoma County.
"Investors who once hoped to make a quick buck on rising home prices are now pulling back from Sonoma County's housing market, according to a study issued Tuesday."
"Buying and selling homes within such a short period is known as "flipping." Investors seek quick profits particularly when sales are strong and home values are rising."
"Almost half of the Sonoma County sellers who flipped their homes in the second quarter lost money, according to the study.Statewide, 2.4 percent of homes sold during the second quarter had been owned less than six months, compared with 3.8 percent in the first quarter of 2005, the study found. It was the lowest level of flipping activity since the first quarter of 2003."
posted by Athena @ 4:09 PM
3 Comments:
Interesting piece on the RE show on KSVY radio the other day. They had a flipper on, however nont your ordinalry flipper but someone who has bought fixed up, and re-sold houses for a looooooong time. She was going over the common mistakes people make in attemtping to flip, every single one of which we've all discussed here (and my friends are making right as I write this) On the subject of falling prices and a cold market, she said that right now anyone doing this has to figure in holding costs..(after finishing the project) of at least 8 months, and now it could be longer...8 months (or more) of holding on to a flippy house. Scarey.
the article also mentioned that when concluding who had lost money,the cost of any improvements made was not considered,however transaction costs were.i would bet at least half of the people flipping lost $,and this is just the beginning.i talked to a broker today who was complaining that his clients won't drop prices fast enough to sell,then asked him about the spec house he is trying to sell,and he is doing the same thing! he has dropped his price $150k since april 1st,and no offere since a lowball in may(for more than he is now asking...)no one who is in the market today is rational,especially the lenders who are still offering 100% financing in a clearly declining market.btw i still want that cup of coffee.
as to the coffee you're on. Every time I Zillow a house for info it sems it's only going in one direction and it ain't up.
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