Practice of flipping homes making gains in United States

July 19, 2013 at 9:12 AM
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IRVINE, Calif., July 19 (UPI) -- The practice of flipping a home -- selling it less than six months after buying it -- is making gains in U.S. markets, an online real estate firm said Friday.

Through the first half of 2013, flipping homes climbed 19 percent from the same six months of 2012, RealtyTrac said.

The firm reported said 136,184 home flips January through June.

Home-flipping sales, up 74 percent from 2011, earned an average net gain of $18,391 per home, a 9 percent gross return on the buying price, RealtyTrac said.

In the first six months of 2012, gross returns averaged $5,321 per house. In 2011, selling a house within six months of ownership yielded an average loss of $13,206, the firm said.

RealtyTrac said good timing helps make flipping a home profitable.

Flipping a home in a market in the early stages of recovery has a good chance of turning a profit because homes can be bought for a discount, then sold while demand is driving up prices, the firm said.

On average, in the first six months of the year, real estate investors selling homes within six months purchased them at 5 percent below estimated market value and sold them at a premium of 1 percent above estimated market value, RealtyTrac said.

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