Home flipping gaining popularity in Sacramento
In the years prior to the housing bust in the mid-2000s, property flipping grew in popularity as a way to make money for those who were real estate savvy. However, upon the market crash, many professionals veered away from this once-lucrative job. The financial risk became too great as the economy slowed, house prices dropped and many people found themselves underwater on their mortgages.
The Sacramento Bee reports that house flipping has once again gained popularity in Sacramento. Potential homebuyers looking at real estate in Sacramento may encounter a lot of polished rooms and fresh coats of paint. Flipped homes are making up a larger share of the Sacramento housing market than at any other time in the past 10 years, according to the news source.
According to real estate news and data provider DataQuick, flipped houses made up 8.1 percent of the home sales in September 2012 - up from 4.4 percent in a year-over-year comparison. In some communities in the Sacramento County, the number of flipped home sales nearly tripled.
The change in the number of flipped property sales may be the result of the increasing affordability of home financing, decreased property prices and the availability of distressed properties.
"Assuming this year's modest upward trend in pricing holds, we’ll eventually see the market begin to re-balance with more supply, though that could take many months," said John Walsh, president of DataQuick. "More and more potential move-up buyers who do have equity will be thinking about timing their next purchase to maximize the advantage of super-low rates and relatively low prices. As more potential sellers get off the fence, or no longer owe more than their homes are worth, we’ll see the inventory of homes for sale rise. That's going to limit price appreciation."
The highest percentage of flipped property sales in Sacramento occurred in January 2003, The Sacramento Bee reports. Flipping rose by 43 percent statewide in the first six months of 2012 in comparison to the first six months of 2011. While the flipping profession is growing in popularity once again, today’s participants seem to be experienced and are playing the market with more caution.
Flipped properties may offer potential homebuyers the chance to move into a house that is clean and refurbished with quality materials. Check out the MLS listings in Sacramento to find the right home in this metro.