Are House Flipping Shows About To Make A Comeback?

I’ve been reading about an interesting phenomenon in the local (Metro Detroit) housing market.  There is currently both a buyers market and a sellers market happening simultaneously.  I would expect that this is happening in many areas around the country as the real estate market recovers.

A sellers market is defined as having less than three months of available inventory for sale.  A buyers market is having more than that.

What’s happening is that buyers are looking for move-in ready homes.  Those homes are being snatched up quickly, and are even back to the days of receiving multiple offers, some above asking price.  There is currently only a one and a half month supply of these types of homes in our area, making it a definite sellers market if your home is well kept and move in ready.

Distressed homes, on the other hand, are still in big supply.  Foreclosed properties that need work.  Owner occupied homes that have been seen regular maintenance and upkeep fall by the wayside.  Those homes are still readily available.

Meaning that buyers have the option of buying a home and putting work into it….but right now, they don’t want to.

I wonder if this means that the days of house flipping are on the horizon once again.

If a flipper can start buying those homes that people don’t want, putting money into them, then logic would say that they’d then enter the sellers market.  Provided they can get the house at a reasonable cost and perform renovations so that their total cost is lower than what they get, I would think you might see flippers back in earnest.

Some of my favorite reality TV revolved around house flipping prior to the crash.  My favorite show in that genre was Property Ladder, where a crew would follow a flipper, usually a novice, from the time where they outlined their plans and their budget, to the time where the flip was complete, showing the various progress along the way.  There were inevitably delays and budget overruns.  In many cases, the flips were successful and they made out, but in other cases, their overruns forced them to sell at a loss, or forced them to hold onto the property for a lot longer than they had planned.

I’m sure a lot of it was staged, but it made for great TV!  And, I hope that the current market re-opens that door once again.

Are you seeing the buyer/seller market condition in your area?  Would you consider undertaking a flip to bring a home into the sellers market? 

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14 thoughts on “Are House Flipping Shows About To Make A Comeback?

  1. I don’t think we are out of the woods yet. Only the brave should buy right now in certain areas. Europe is still a HUGE concern and the market could turn on a dime. I have a house in Newark NJ. Yes you read that right. The neighborhood is quite nice and looks nothing like what is shown on TV. People just aren’t buying yet. Hopefully within 5 years that will change.

    • I agree with you though from what I’m seeing, we are definitely pointing in the right direction. Hopefully we have hit and bounced off the bottom, though we do have a long way to go.

    • Same story here – my house has been on the market for four months, and it IS in move-in condition (the agents and buyers who have come for showings agree). The problem is that NEW construction is doing very well in our area while existing sales are still sluggish.
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      • At least one area is taking off. That has to mean something positive that hopefully will spread to everybody, right?

  2. Interesting about Detroit!

    Hereabouts (Phoenix), you would not believe what’s going on in the real estate market. Inventory down so low fewer than 1400 single-family homes on the market…bidding wars in the $100,000 to $200,000 range…buying frenzy spreading into the $200,000+ range. It almost looks like we’re looking at another inflating bubble.

    Friend of mine put her house on the market — she bought about a year & a half or two years ago, paid $225,000 for a house in a very nice central location. Decided she wanted to move back to the suburbs, which she prefers for a variety of reasons. About three weeks ago, a mutual friend & Realtor listed the place for her at $269,000. It sold in two days flat, and they had three back-up offers. She said 25 people came through the house the weekend it went on the market.

    It’s just bizarre.

    • That’s a good way to look at it. I think it fell so far so fast that there was a ton of pent up demand that is now getting realized.

  3. I loved watching property ladder.

    I too am surprised about homes in Detroit, although if approval for the new bridge between Windsor and Detroit goes forward that will create quite a few new jobs on both sides which hopefully will boost the economy in Windsor and Detroit and increase the value of homes.

    • Good point. They said it would put just about everybody that’s lost a job in the construction industry back to work, at least from a numbers perspective. I’m excited about the new bridge.

  4. I’m definately seeing the buyer/seller market condition in Los Angeles. Familes are having a hard time buying move in ready homes but there’s still large supply of forclosures with differed maintenance.

    It’s a great opportunity for fix and flippers. And it’s not just here, it seems like its all over the U.S. I just bought a house in Georgia to fix and flip and go a great deal.

  5. I actually used to work with real life house flippers. It was very interesting to listen to their stories. They did it as a hobby that turned out to be very profitable. In fact, I learned quite a few things from them: what look when buying a house, how to fix things and so on. I wonder where they are now… Last time I heard they were still doing okay. In spite of the market condition.

    • That must have been really cool. I always thought that being involved in home construction would be kind of a cool thing. Not the hands on part, but the oversight and such.

  6. Hunh, interesting to hear about the market in Detroit. I haven’t been paying too much attention to the broader market in my area (school and work have been occupying too much of my time), but I’ve noticed a few homes, generally ones in fairly poor condition, on sale in my neighborhood lately. (Usually when I’m out walking my dog.) I’ll have to keep an eye on what happens with these home; a flurry of activity followed by another sale might mean that Meadville, PA is experiencing a revival of house flipping as well.
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