According to the housing analysis firm RealtyTrac, about 4.7 percent of 2013 home sales countywide were purchases made within six months of the previous sale, a move that indicates an investor bought low and sold high.
The average growth profit on a flip in Palm Beach County last year was $67,265, up from $50,065 in 2012.
“Strong home price appreciation in many markets boosted profits for flippers in 2013 despite a shrinking inventory of lower-priced foreclosure homes to purchase,” said Daren Blomquist, vice president of RealtyTrac. “Flipped homes were still purchased at an average discount of 13 percent below market value in 2013, the same average discount as 2012, indicating that investors are finding discounted buying opportunities outside of the public foreclosure process — particularly in those markets with the biggest increases in flipping for the year.”
Wall Street investors and well-funded hedge funds have all got into the home-buying market in recent years hoping to buy low, rent out, and sell when real estate fully recovers. But those purchases wouldn’t count in RealtyTrac’s flipping report.
More common are the purchases by companies such as We Buy Ugly Houses, which tries to buy low, remodel and resell.
In the fall, We Buy Ugly Houses franchise owner Don Cameron, said his West Palm Beach-based company is having a harder time finding profitable flips since the entrance of the Wall Street landlord.
“We understand the complexities of dealing with a house that needs more than just carpet and paint,” he said. “But we don’t make a huge profit on any job.”
This entry was posted
on Monday, February 3rd, 2014 at 8:40 am and is filed under Florida economy, Foreclosures, Housing affordability.
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