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| House Flipping https://gladerebooted.net/viewtopic.php?f=2&t=11934 |
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| Author: | Micheal [ Tue Aug 29, 2017 6:23 pm ] |
| Post subject: | House Flipping |
The trend of house flipping is getting a little weird. As most of you probably know, house flipping is the purchase of a house that needs some fixing up, then doing a moderate job of making those repairs, then reselling it at a substantial profit. For those folks who have the bucks, skills, and desire to do this, more power to you. The part I don't like is they usually low-ball the purchase price of the original sellers, telling them (lies usually) what miserable shape their house is in, then offering well below market value because the sellers have no clue what the house is worth. Another aspect is the short sales where the seller is desperate to dump the house and get anything out of it. Capitalism, fine, not sure where the ethical line is there, so I'm just going to keep my disdain for cheating people and you can believe what you like. Recently I've noticed an up-turn in the house flippers marketing. Yesterday alone I received two phone calls, three pieces of mail and an e-mail asking to buy my house. Usually I've been getting about that many a week, strange to get them all in one day. The mortgage is fully paid off, the house is in decent shape, taxes are paid up, so I'm not really sure why I'm getting all these contacts. No, I'm not interested in selling. Thank you for the thought but I'm particularly not interested in selling to a lying douche who is offering me 50k under what the place is worth. I'm doing fine, I have no need or desire to sell, please go away. So, anyone else out there getting pestered by these flippers? What is your take on the whole deal? |
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| Author: | Taskiss [ Tue Aug 29, 2017 8:53 pm ] |
| Post subject: | Re: House Flipping |
You offer someone $x for their house and they agree, you're not cheating them. Offer $x, they agree, and then give them $x - $y, you are cheating them. I keep my home in shape for a sale 100% of the time. Offers by realtors for them to put my home on the block happen every spring as the market opens and stop in the early summer after schools close. It's the circle of life, played out on realtor.com |
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| Author: | Diamondeye [ Wed Aug 30, 2017 9:01 am ] |
| Post subject: | Re: House Flipping |
There is no such thing as an "ethical line" in low-balling the price. It is very easy to find out what your home is worth; the local tax assessor will be perfectly happy to tell you for free. If the house flipper didn't try to buy houses on the cheap they wouldn't be able to make money doing it, once you consider the opportunity cost of the time spent working on the house that could have been put to use earning income in other ways. Even not considering that, if they bought the house at "market value" and then sold it at "market value" with a few improvements it would be a pretty unprofitable endeavor. As for short selling, the house flipper is doing the seller a favor. When a person is short selling and "desperate", they need any offer they can get. If you can't sell your house, you generally have to stop paying the mortgage to become eligible for a short sale or any other relief, so if you need to move but can't sell a house you can otherwise afford the mortgage on you can find yourself in a situation where you intentionally have to default to get rid of the house at all. You see, there's a thing called "failure to mitigate". If you have a reasonable short sale offer on the table, the bank has to take that money before they can think about coming after you for the rest. It's an obligation to make their own losses as small as possible before seeking remedy. They can't decide to come after you for the whole amount until they've taken what someone will pay. By putting an offer on the table, the flipper is putting the onus back onto the bank. The bank will be getting some of the money back; not only are they obligated to take this money, it greatly reduces the value of coming after the seller for the rest once you consider the cost of litigation. |
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| Author: | Screeling [ Wed Aug 30, 2017 3:13 pm ] |
| Post subject: | |
In the case of a short-sale, the former house resident doesn't get any of the money anyway and the short-sale can only proceed if the bank permits it. In that situation, it seems about as win-win as circumstances will permit: Former resident is sort of off the hook, bank cuts their losses, the new buyer has a chance to make money, and neighbors are happy that the average property value in the neighborhood might come up a little bit. If somebody is selling their house without an agent, they should at least have a decent idea of what they're selling. If somebody is hard up to sell it, well, I suppose there's something to be said for sacrificing on price for a speedy transaction. Doesn't seem like that situation would be anywhere close to the norm though. |
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| Author: | Arathain Kelvar [ Fri Sep 15, 2017 3:20 pm ] |
| Post subject: | |
I've "flipped" several houses, but I've lived in them, so it's not really the same. I always buy houses that need work, fix them up while I live there, and sell high. Market value is what someone will pay for it. If it's on the market a bit, and you get one offer - that's market value. |
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| Author: | Aethien [ Wed Sep 20, 2017 2:21 am ] |
| Post subject: | |
It's funny, I actually have a part-time gig with a company that lends to house flippers. So, I may have an insight, having looked at houses for them for the past 4 years. I used to go to South Central (L.A.) a lot, and other sketchy neighborhoods, when I first started. Also up in the desert, Lancaster, etc. But lately it's been more central Los Angeles, with higher end neighborhoods and homes. I think the low-end market may have tapped out, and the flippers are moving up, perhaps? Maybe the market's better, and it's easier to flip a $500K house than a $200K house, in your case, Michael. |
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| Author: | Micheal [ Wed Sep 20, 2017 9:38 am ] |
| Post subject: | |
My current house is rated at $265K by Zillow, this week anyway. I bought what we thought of as a starter house in a blue collar and retirees neighborhood for $71K almost 30 years ago. Three bedroom, one bath. Detached garage that is never used for parking, but usually used for storage. Property taxes are around $1100 per year. Insurance is reasonable. It has remained a blue collar and retirees neighborhood all this time and is of course the longest I've ever lived anywhere. I've replaced the roof once, the water heater twice, the HVAC system once, and the front door once (because the old one was not well installed and had warped badly. Some other not real major but not minor homeowner stuff It has been painted once and is probably overdue for repainting. My neighbor and brother-in-law built a ramp for Carol's wheelchair when she was getting worse, but I tore it out a few years after she passed. The front yard needs to be reseeded, the back yard I never pay attention to, never spend time in. Its convenient to a lot of things. Grocery shopping is three blocks away. So is the post office. The library and my favorite Indian restaurant is about twice as far. Way too much fast food is about a mile away, right next to the freeway on-ramp. More Grocery shopping is about two miles away, as well as a Target and a smallish shopping mall. The major shopping malls are far enough away the traffic rarely impacts me. Gas stations, I get my pick within two miles, I usually use ARCO because it tends to be cheapest. I'm on the West side of Sacramento and if I'm heading to the Bay Area I'm on I-80 heading West in under five minutes. Heck, even IKEA, Home Depot, and Lowes are less than a couple miles away The City of West Sacramento has had a fiscally conservative, socially liberal City Council and Mayor for years. We're in good shape financially. Can your town say that? The Mayor is on his seventh (two-year) term, does a good job, is Hispanic and openly gay, and nobody makes an issue of any of that unless they do it in their own homes. Its a comfortable place for me to be. Still not sure why I'm getting all the interest. Yes, some things could be better, but the crime rate around my neighborhood is pretty low. Really, the only reason I can think of to have to move is if I fell in love with someone I had to move to be with. |
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| Author: | darksiege [ Fri Sep 22, 2017 12:27 pm ] |
| Post subject: | Re: |
Micheal wrote: Still not sure why I'm getting all the interest. ... but the crime rate around my neighborhood is pretty low. This right here.... the interest is because the crime rate is low. |
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