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Old 01-06-2022, 08:20 AM
 
Location: Raleigh
13,715 posts, read 12,449,591 times
Reputation: 20227

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Quote:
Originally Posted by GotHereQuickAsICould View Post
That's what it looks like to me.

Every flipping show starts out with a discussion of the neighborhood comps, and how they can't offer the seller what she/he is asking because they could lose money.
Quote:
Originally Posted by GotHereQuickAsICould View Post
The realtors on this forum could likely answer this better than I can, but it looks to me like the "perfectly serviceable" homes are being bought by couples and families.

Though some sellers may go for the low-ball cash offers, most look at the bottom line to decide which offer to take. Even if it means waiting another 5 weeks or so.
Not where I live...it really depends on the neighborhood. If there is meat on the bone the home gets flipped...or in some places, scraped off the lot.

Here's the thing...a flipper doesn't ask "can I get this house for cheap?" They ask "Is (Purchase+upgrades+carrying costs) < projected sale price after the upgrades."

My next door neighbors moved here in 1984...they always joke about being referred to as "the new young family in the neighborhood." They're 70. People in the neighborhood don't have the types of careers that move them, on the whole and the houses are small enough and all one story so mobility is less a concern. One neighbor retired from the school system, another was a corrections officer, a third owned a small manufacturing business in town, a 4th retired as a nurse. From my mailbox, I can see 5 homes occupied by their original, octogenarian owners who bought the homes in the mid 60's. These homes are maintained. The lawns are mowed, The houses have roofs replaced when needed, HVAC replaced when needed, etc. Most of them have had new windows at some point. But, a solid half of them haven't had notable updates on the interior of the home, at least not in 25+ years, and they sometimes have a layout that most will want to open up a little bit since they were built before central air was commonplace.

Contrast that to my parent's neighborhood where I grew up. It's more white collar, homes are twice the size as mine, two stories. Most of them have had three owners since they were built, and updated over time as there have been at least owners with different tastes and desires in less time. That means that they never became extremely dated. And, the layout works well s. The only flip in that neighborhood was actually torn down because it was lived in for 40 years by someone that couldn't maintain it for 20 of those years. However, two blocks away, there were smaller homes (1800 sf) that were very livable, and several were bought by builders that scraped them off the lot to but up 6000 sf homes. This wasn't a working class neighborhood that gentrified, but it went from white collar to white shoe.
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Old 01-06-2022, 10:16 AM
 
Location: Columbia, SC
10,967 posts, read 21,995,719 times
Reputation: 10685
Quote:
Originally Posted by JONOV View Post
Not where I live...it really depends on the neighborhood. If there is meat on the bone the home gets flipped...or in some places, scraped off the lot.

Here's the thing...a flipper doesn't ask "can I get this house for cheap?" They ask "Is (Purchase+upgrades+carrying costs) < projected sale price after the upgrades." ...
We have a few agents in the Raleigh area that contribute to this board. I'd be curious to have their take on that.
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Old 01-06-2022, 11:49 AM
 
14,487 posts, read 20,671,714 times
Reputation: 8002
From our point of view in the economy the flippers we have lost out to cost us a home to live in. So flippers are hurting those who want a place to live. Flippers will of course always be there due to their deep pockets and ability to make cash offers, etc. which lower income persons can not afford.
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Old 01-06-2022, 11:59 AM
 
23,177 posts, read 12,234,562 times
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Quote:
Originally Posted by Diana Holbrook View Post
Mostly good. Flippers often take homes that are not in livable condition that would not qualify for financing, and they fix the major items to make them available for first time or other financed homebuyers. That’s a valuable service.

But the "fix" is often low quality superficial repairs.
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Old 01-06-2022, 12:04 PM
 
16,615 posts, read 8,625,712 times
Reputation: 19447
Quote:
Originally Posted by accord2008 View Post
I have been watching a lot of house flipping shows lately, and researched online. People say its taking out affordable starter homes for families, and with flipped houses selling for more, it makes real estate more expensive for all the neighborhoods it was sold at. Many homes that I watched were liveable, and doesn't need the kitchens and bathrooms to be torn down. Some family out there don't mind living in a house built in the 80s.

But on the other hand, what I noticed is that when a house flipper does his work, buying and selling will make RE agents get jobs, contractors, cleaners get work, home depot sells materials so their workers are getting work, and the material that's being made from whichever factory, gets work, on top of truckers transporting the materials. It's a system that employs alot of people when a flip goes on. In the end the flipper gets a profit, and many people get jobs. The person paying for all of this is the home buyer, usually 120-150K more in price compared to the house that was untouched (at least from what I saw on TV, average profit was 50K, spending 60K average for expenses, and the rest is agent fees)

So the big question is, is flipping good or bad once everything is factored in?
Interesting question.

I myself was taught to buy the worst home in the best neighborhood that I could afford, and fix it up myself. In a normal market you get the best deal, and your home will appreciate in value, as a rising tide lifts all boats.
So if you and/or your family/friends have skill enough to repair/replace XYZ, and you do not need to "gut" the house because you must have the latest fashion trend, that is how many of us have started our upward mobility.
However, many younger people (especially the guys who were not taught how to do xyz by their dads) cannot or will not put in the sweat equity needed to make the house right for their mate and future family. I could go off about the feminization of men in modern American society, but I do not want to get ideological/political.

I find many homes in more affluent areas perfectly fine to live in, yet they will be torn down to the foundation to make way for a McMansion.
In some cases it is out of need to make the place larger, but the square footage a couple with one or two kids have today, is absurdly large.
Many of our parents and certainly grandparents grew up with a lot more siblings in much smaller homes. Sure there were inconveniences with bathroom time and kids sleeping in the same room, but that also tended to bond the family more, and make people more respectful of others needs.

Now if you are speaking of flipping for flipping's sake, just doing window dressing be it paint, appliances, landscaping, etc., and trying to make a huge profit, that is not "good" for society. I say that in the sense it does diminish affordable homes for those needing a starter home, or those trying to upgrade into say an empty nesters home.
Don't get me wrong, as I do believe people can make a living out of flipping homes, so who am I to impugn something people do to make a profit, that others are willing to buy.
But when you see someone buy an undervalued property from an old person that has no clue what the value of the property/home is, and then put lipstick on a pig and try to make a 700% profit, that certainly is not helpful to anyone but the greedy profiteer.
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Old 01-06-2022, 12:45 PM
 
Location: North Idaho
32,664 posts, read 48,091,772 times
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Quote:
Originally Posted by JONOV View Post
My complaint is that in my market there's a lot of livable housing that get bought by flippers. Dated places that are still very servicable; some of them were nicer than the apartments I rented before buying.

And the flippers are not stealing those houses from anyone. The people who can only afford that old serviceable house have just as much right to buy that house as anyone else.


There is no special "wholesale" market for house where flippers get a special price that no one else can have. The lower income buyer has just as much chance to buy that house as the flipper does. There is no policy of any sort that says owner occupants can't buy any bargain house they can afford to buy. The flipper isn't getting the house cheaper or easier. The owner occupants don't buy it because they don't want to do any of the work to make the house habitable. Or else they don't because they don't want a house that doesn't have new carpet and new paint and a white chipboard kitchen. It's not because they are locked out of the purchase because they don't have a contractor's license
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Old 01-06-2022, 01:11 PM
 
14,487 posts, read 20,671,714 times
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Quote:
Originally Posted by oregonwoodsmoke View Post
The lower income buyer has just as much chance to buy that house as the flipper does. And the flippers are not stealing those houses from anyone.
Can you explain that?

I had a property stolen from us because the other buyer paid cash and was a flipper. Our loan offer was the high offer and the cash buyer matched our offer and the seller accepted.

Flippers and investors can afford to offer more than lower income persons. John can get a mortgage of 100K. But Jim has cash and can offer more than 100 if the value is there for him.
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Old 01-06-2022, 01:34 PM
 
Location: nw burbs
173 posts, read 111,584 times
Reputation: 214
based on flip my child bought, i say it is not good. Some flippers do really cheap work, and basically enclose "rotten" look in a shiny wrap. First time home byers beware of flipped houses.
Although, when buying existing house (not brand new), first time home buyer will inevitably make too many pricy mistakes.
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Old 01-06-2022, 01:40 PM
 
Location: Raleigh
13,715 posts, read 12,449,591 times
Reputation: 20227
Quote:
Originally Posted by oregonwoodsmoke View Post
And the flippers are not stealing those houses from anyone. The people who can only afford that old serviceable house have just as much right to buy that house as anyone else.

There is no special "wholesale" market for house where flippers get a special price that no one else can have. The lower income buyer has just as much chance to buy that house as the flipper does. There is no policy of any sort that says owner occupants can't buy any bargain house they can afford to buy. The flipper isn't getting the house cheaper or easier. The owner occupants don't buy it because they don't want to do any of the work to make the house habitable. Or else they don't because they don't want a house that doesn't have new carpet and new paint and a white chipboard kitchen. It's not because they are locked out of the purchase because they don't have a contractor's license
Nonsense. No one said anyone is stealing anything. More importantly than "the people who can only afford that serviceable house" are the people selling it. I know because I tried at least twice to buy said "serviceable old house."

The flipper isn't getting it cheaper but she does get it easier.

Put yourself in a sellers shoes. You're selling it as the executor of Mom and Dad's estate, or handling the sale since Mom had to go into a home. You're emotionally tired and mentally done with dealing with it. House goes on market, two highest offers are

1) $200K cash, 1 or 2 day due dilligence period, close in two weeks, or,
2) $203K from a buyer looking to live in the house, and is more than qualified for the mortgage but since he's getting a mortgage, needs 31 days to close with longer 21 day DD period.

Most people will forego the $3K for the sure thing. Not because they want the money two weeks sooner but because they are happy not to have to live with the uncertainty of inspections and appraisals and whatnot.
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Old 01-06-2022, 01:59 PM
 
Location: Raleigh
13,715 posts, read 12,449,591 times
Reputation: 20227
Quote:
Originally Posted by Brandon Hoffman View Post
We have a few agents in the Raleigh area that contribute to this board. I'd be curious to have their take on that.
And one of them was mine.
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