Home Flipping attracts Big Investment Interest

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South Florida saw resurgence in home flipping in the first quarter as investors capitalize on more distressed properties hitting the market. About 10 percent of all home and condominium sales in the January-through-March period were flips, the highest share since the third quarter of 2006, according to RealtyTrac Inc., a real estate research firm. The 2,440 flips in the tri-county region were the most of any metro area nationwide and represented a 9 percent increase from a year ago, RealtyTrac said.

A flip is defined as a property sold twice within 12 months. Flippers helped the housing market recover from the six-year downturn by renovating and adding value to rundown homes. But too much flipping can accelerate home-price appreciation beyond what the market can handle. Historically, flipping has accounted for 7.5 percent of all home and condo sales in South Florida.

Higher home prices in recent years have chased flippers from the market, but those who remain are enjoying solid returns. The gross profit for a flipped home in Palm Beach, Broward and Miami-Dade counties in the first quarter was $65,000, up from $54,500 a year ago, RealtyTrac said. The return on investment was 51 percent, compared with 46 percent in the first quarter of 2015. To continue reading click here…

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