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Argument 1 presented against flipping is "Flippers elimate affordable homes?" and/or argument 2 is "Flippers put lipstick on a pig."
Most people who need affordable homes can't afford the cost to renovate a home, so to me that eliminates argument 1.
Argument 2 is resolved with a good buyer agent and a good inspector.
Also, someone made a good point that the same discussion revolves around owner occupants and landlords that renovate a home to sell. They own the home and have the resources to make improvements and increase profit. What is the argument against someone being able to do as they wish with a property they own? I can't come up with one, but perhaps someone else can?
That definitely isn't true. I know a number of people who have been doing renovations over time. However, they bought a couple of years before this latest boom when the prices weren't as attractive to flippers and the houses weren't moving as quickly and price negotiation was still happening.
Inspector can't see behind walls so a lot of things can;t be seen. Also, the whole point is that the prices have been driven up and flippers often have cash from hard money loans so no real estate agent or inspector will be able to fix that. Also, with thes eprice increase, property tax increases have occurred that have driven older, longterm residents out if their homes because they can't afford the taxes on a fixed retirement income.
FWIW, not all the shoddy current flips/rehabs are entirely the fault of the folks doing it, IMHO. The quality of materials has significantly declined over the past forty years. I put in a one piece fiberglass tub shower unit in a new build back in the early 90s and I can't find those anymore. Now they're much thinner plastic versions. Some of them have the solidity of a soap bubble. They're cheap enough, but 'contractor grade' now means cheap sh*t far as I can tell.
I don't see a lot of flippers in our area. Possibly because of the cost of acquiring the properties in the first place as well as the difficulty of finding workers, cost of materials and everyone knowing who you are, too. Reputations get around quick on an island.
We may sorta be flippers, although I suppose we're more rehabbers than flippers. We find old tear downs and prop them back up again, more so than flipping them. Generally, though, we keep them for at least several years as long term rentals so that helps increase the available houses in our area.
The first was the 1911 house that needed just about everything. Anything we did to that one was an improvement. We lived in it while improving it, I really prefer NOT to do that. New solar electric (it was off grid so we had to do stand alone photovoltaic), new plumbing, replaced half the foundations (it started out as posts set on rocks), new posts, new beams, new floor joists, etc. Everything from the floor on down was basically rebuilt and replaced. Brought it up to what was then the current code, too, although that was three code changes ago. It was sold to someone who replaced the old six over six windows with vinyl sliders. Bigger ones, but not in character with the house, but we sold it so not our circus nor our monkeys anymore. They also pulled out the ginormous tub that had been installed in the bath and replaced it with just a shower, but once sold, not our project anymore.
The second is a '74 single wall house. That got a new back deck, a window turned into French doors out onto the deck, big solar electric although that one is on grid but the panels offset the electric bill. It's been a rental for awhile, but we're gonna sell it pretty soon. It could use 'updating' one supposes, but we will let whoever buys it do that if they want. Everything works so no need to fix it, IMHO.
The second one wasn't much of a rehab, but the third one is. It's still under repair unfortunately we are again living in a construction zone.
However, in the middle of the third rehab, we took on the fourth one. That one was a major fixer. It had 'homeowners' 'improving' it for about six months. Turns out they were actually squatters from the mainland who were under the impression that if they 'improved' a property they would have to be paid for their work. Dunno if that works on the mainland, but not in Hawaii. They took out walls until the ceiling fell six inches and they almost dropped the roof on themselves. At least they hadn't gotten to the point of removing the big windows. I happen to like big wood framed sliders and wood framed double hung windows. They did rip out all the old solid kitchen cabinets as well as took all their 'improvements' with them when they were shifted out of there. So, no interior doors, light fixtures or switches as well as a few less walls when we got it. The bathroom floor was interesting where they slapped a chunk of 1/2" ply on the floor over the hole in front of the toilet and tried to level it with tile.
Year and a half restoration on that project and it's now a long term rental. Probably won't sell that one for awhile, but after/when or if we get Rehab #3 done that one will probably get sold. The next one is gonna be new build, that's so much easier than renovations and I'm getting lazy.
FWIW, not all the shoddy current flips/rehabs are entirely the fault of the folks doing it, IMHO. The quality of materials has significantly declined over the past forty years. I put in a one piece fiberglass tub shower unit in a new build back in the early 90s and I can't find those anymore. Now they're much thinner plastic versions. Some of them have the solidity of a soap bubble. They're cheap enough, but 'contractor grade' now means cheap sh*t far as I can tell.
I don't see a lot of flippers in our area. Possibly because of the cost of acquiring the properties in the first place as well as the difficulty of finding workers, cost of materials and everyone knowing who you are, too. Reputations get around quick on an island.
We may sorta be flippers, although I suppose we're more rehabbers than flippers. We find old tear downs and prop them back up again, more so than flipping them. Generally, though, we keep them for at least several years as long term rentals so that helps increase the available houses in our area.
The first was the 1911 house that needed just about everything. Anything we did to that one was an improvement. We lived in it while improving it, I really prefer NOT to do that. New solar electric (it was off grid so we had to do stand alone photovoltaic), new plumbing, replaced half the foundations (it started out as posts set on rocks), new posts, new beams, new floor joists, etc. Everything from the floor on down was basically rebuilt and replaced. Brought it up to what was then the current code, too, although that was three code changes ago. It was sold to someone who replaced the old six over six windows with vinyl sliders. Bigger ones, but not in character with the house, but we sold it so not our circus nor our monkeys anymore. They also pulled out the ginormous tub that had been installed in the bath and replaced it with just a shower, but once sold, not our project anymore.
The second is a '74 single wall house. That got a new back deck, a window turned into French doors out onto the deck, big solar electric although that one is on grid but the panels offset the electric bill. It's been a rental for awhile, but we're gonna sell it pretty soon. It could use 'updating' one supposes, but we will let whoever buys it do that if they want. Everything works so no need to fix it, IMHO.
The second one wasn't much of a rehab, but the third one is. It's still under repair unfortunately we are again living in a construction zone.
However, in the middle of the third rehab, we took on the fourth one. That one was a major fixer. It had 'homeowners' 'improving' it for about six months. Turns out they were actually squatters from the mainland who were under the impression that if they 'improved' a property they would have to be paid for their work. Dunno if that works on the mainland, but not in Hawaii. They took out walls until the ceiling fell six inches and they almost dropped the roof on themselves. At least they hadn't gotten to the point of removing the big windows. I happen to like big wood framed sliders and wood framed double hung windows. They did rip out all the old solid kitchen cabinets as well as took all their 'improvements' with them when they were shifted out of there. So, no interior doors, light fixtures or switches as well as a few less walls when we got it. The bathroom floor was interesting where they slapped a chunk of 1/2" ply on the floor over the hole in front of the toilet and tried to level it with tile.
Year and a half restoration on that project and it's now a long term rental. Probably won't sell that one for awhile, but after/when or if we get Rehab #3 done that one will probably get sold. The next one is gonna be new build, that's so much easier than renovations and I'm getting lazy.
You are absolutely correct. I am one to try and use the best quality materials even for starter homes because I want them to last. They do not exist.
Even buying named brand plumbing fixtures (for example) don’t mean a thing. I still get failed shower values in roughly 4 years. I told my plumber I wanted better quality stuff like the faucets you still find in a school built in 1940s or 1950s….thinking maybe I needed commercial products. Nope. I was told “they do not exist anymore”. You can bet my refrigerators won’t last much last 10 years and won’t make it that far without a repair need. Meanwhile if I buy a house built in the 1950s it still has the original working bright yellow wall oven and the refrigerator they replaced once in 1978.
Same with AC units. Every single one I’ve replaced in the past 8-12 years has had repair issues and needs. Some major, like needing a compressor or new coils. Yet the three I have from 1991, 1995 and 1999 have given me zero trouble in since I’ve owned them. I once replaced a 30 year old heat pump simply as a preemptive measure thinking it would be more energy efficient. Bad move.
I knew an older Italian guy that fancied himself as a contractor/interior designer as well as being a restaurant owner. He nailed the restaurant business, the contractor/interior designer........ummm not so much.
I agree. The new owners very well may just remodel it. I would never want a house that cost so much, with property taxes and insurance to go along with it that had other houses practically on top of it. No location is worth that unless it has some acreage with it.
In the way that flipping is practiced by the majority of flippers (even the decent, generally well-meaning ones), I consider it bad. This is not to say that it is always bad or has to be bad. But it's a matter of fact that flipping is profit driven by the flipper, so the minimum is always going to be done. And very rarely do I think the updates are actually thoughtful even if the end product is aesthetically decent.
Don't get me wrong, I'm in favor of updating old homes (I have a long thread on the interior design forum where my wife and I have been updating a 1949 house), but the number of times that I think a flip checks the boxes of: Made the right and appropriate code/safety/energy efficiency updates, updated the house aesthetically in a *consistent* and architectural way (ie not a property brothers or pinterest view), and also respected any existing architectural integrity of the house is small. Even the seemingly 'high quality' flippers in my area...I cringe doing the open house tours more often than not.
The 'good agent' or 'good inspector' argument is kind of void because in my experience SOMEONE ends up buying the house. The good inspector only helps certain buyers from buying a potential money-pit. But there is always a sucker out there. So I don't see that as a gatekeeper for bad flips in general.
In theory, flipping creates visibly improved dwellings, likely increases surrounding property values, and provides some work for the local building and supply trades.
The annoying part of flipping is that it does largely shut out a class of first time home buyers. When my siblings purchased homes 10+ years ago, it was easy enough to find a home that was occupied by an elderly person, sold by family upon death or relocation. The homes needed work and it could be done by the new owners, but the homes were reasonably priced with a mortgage easily obtained. 10 years later, flippers scoop up those homes with cash offers before the ink is even dry on the ad.
A flipper is someone who sells a home after rehabbing it. They typically buy homes in such disrepair they aren’t eligible for a mortgage or insurance. Thus, they put homes back on the market that otherwise would not be sellable to anyone but someone who doesn’t need a mortgage or insurance.
All buyers have equal opportunities. The seller is going to sell to whoever has the best offer and quickest closing date to meet their needs.
The last house I sold had many offers. Only one was from an investor and it was the lowest so I did not entertain it.
I took the highest offer most likely to close.
I don't find that to be typical at all. It must depend on what market/region you're talking about. In the nation's "hot" or even merely "warm" or "warming-up" housing markets, flippers buy a home they perceive as undervalued, sometimes convincing the sellers they can't possibly get anything near the asking price for an "older" home, then make only inexpensive cosmetic changes, then put it back on the market at a tremendous markup.
That's the stereotype of a flipper: putting minimal effort into it, after acquiring a property at a bargain (by hook or by crook), or in an area that's on the cusp of a sudden increase in local RE values (driven in part by other flippers and/or s recent job boom), thus contributing to runaway RE prices.
At least two posters have attempted to make the point that cast iron tubs, even if preexisting in colors buyers don't want, are somehow superior to steel tubs that are new, clean and spotlessly white and appeal to the broadest market. For normal, single family usage there is absolutely no difference in durability or serviceability between the two. This is such a minor point that the pixels burned to post such things are probably more significant. The same is true for those who would attempt to draw the line between ceramic and porcelain tiles. Most people will never notice a difference in their durability over their lifespan. Certainly this is not the place to be deciding the quality of a rehab. Those familiar with construction quality differences would be much more concerned with what type of substrate is behind those tiles surrounding that tub.
At least two posters have attempted to make the point that cast iron tubs, even if preexisting in colors buyers don't want, are somehow superior to steel tubs that are new, clean and spotlessly white and appeal to the broadest market. For normal, single family usage there is absolutely no difference in durability or serviceability between the two. This is such a minor point that the pixels burned to post such things are probably more significant. The same is true for those who would attempt to draw the line between ceramic and porcelain tiles. Most people will never notice a difference in their durability over their lifespan. Certainly this is not the place to be deciding the quality of a rehab. Those familiar with construction quality differences would be much more concerned with what type of substrate is behind those tiles surrounding that tub.
I don't have personal experience with this, but I thought the preference for cast iron tubs had more to do with how they hold heat better than steel tubs?
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