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But that’s their own stupidity. And you are right, I see it all the time. They will pooh pooh the house with the new roof, windows, and AC unit with the 1980s kitchen with old carpeting and green walls and fall over themselves with the house that has a new particle board kitchen with pretty gray walls. Nevermind all the important expensive items like the roof or furnace needing to be replaced in a couple of years.
Agreed. We were able to get into this house and it had a bad closed in patio , ugly linoleum and other things needed fixing including A/C units. We lived with those things and did a couple of renos. On these HGTV shows, the buyers want to tear our obviously useful features because it isn't the "latest and greatest" Put in tacky cabinets instead of the oak or maple wood cabinets that were there. Install a starwars chandelier , tear out the granite because it is not the color of the day, etc..... And move walls right off the bat. White and gray all the time. Yuck!
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?
THIS^^^^^
Realtors profit twice, sellers profit and the buyer has years to go to get any equity after the first two cash out. The big winner: the town/city. They collect the doc stamp fee twice and get to raise the property taxes after the 2nd sale.
I think too many flippers get in over their head and suddenly a first class remodel turns into "operation lipstick pig cover up"
I also wonder how much material that in fact still has useful life left to it, winds up in a dumpster/landfill because of these flips. I think that some will be more inclined to take usable materials to ReStore and such, but the big investor in a hurry will just roll up a dumpster and start gutting... No?
I dislike waste, and it seems like there may be a lot of that happening potentially.
Obviously if the materials are contaminated in some way, like with mold or asbestos, that's a whole different story.
I have been watching a lot of house flipping shows lately, and researched online. People say its taking out affordable starter homes for families, and with flipped houses selling for more, it makes real estate more expensive for all the neighborhoods it was sold at. Many homes that I watched were liveable, and doesn't need the kitchens and bathrooms to be torn down. Some family out there don't mind living in a house built in the 80s.
But on the other hand, what I noticed is that when a house flipper does his work, buying and selling will make RE agents get jobs, contractors, cleaners get work, home depot sells materials so their workers are getting work, and the material that's being made from whichever factory, gets work, on top of truckers transporting the materials. It's a system that employs alot of people when a flip goes on. In the end the flipper gets a profit, and many people get jobs. The person paying for all of this is the home buyer, usually 120-150K more in price compared to the house that was untouched (at least from what I saw on TV, average profit was 50K, spending 60K average for expenses, and the rest is agent fees)
So the big question is, is flipping good or bad once everything is factored in?
Well, if you omit the fact, that flipping makes RE unaffordable to more and more people, thereby contributing to homelessness for some, how does that affect your equation, OP? What do YOU think, after you factor in ALL the relevant info?
Home Depot, etc. had plenty of work before house flipping became acceptable (it used to be viewed as rampant RE speculation & considered unethical) and even popular. What's wrong with our economy, that we need to drive RE prices sky-high and higher, turning homeownership into an unattainable commodity for rapidly growing numbers of the public (it used to be considered the cornerstone of middle-class life and economic stability for families and individuals, but not any more), just to create jobs? There are better ways to create jobs, without sacrificing middle America's access to SFH's. And frankly, I doubt that Lowe's and HD are hiring more staff. They're probably just over-working their existing staff.
I think if it takes a derelict house and makes it into a safe home, and that in turn turns around an entire neighborhood, or even a whole town, it’s a very good thing.
There are a few shows that do this. “Good Bones” in Indianapolis is one, “Home Town” in MS is another, and also “Fixer Upper” in Waco.
I can’t even watch the shows from CA. The poor young couples spend $700k on a total dump, and strip all the character out.
I have friends that bought old houses, lived in them while doing renovation, and in the end it's their forever home. One friend bought a house for 500K and spent 100K on materials, and would be worth 750K if he bought it already flipped. He spend a good year with his wife fixing the house.
Another friend bought a house for 800, spent 120K, and similar flipped house would be 1.2 million. They spent 1.5 years doing so.
Both of them lived switched rooms to live in and do work of the other. It still is cheaper than buying a flipped house where they would never be able to afford it. The biggest thing is to make sure the house doesn't have asbestos if you were to go this route. The good thing about flippers is they Know what works, and have experience with the cheapest contractors that does the job somewhat decently. Someone who doesn't have the connections will choose a bad contractor.
I know of two couples that argued so much about the renovations they were doing while living in the house, one couple ended up getting divorced over the issue.
The year over year home price increases in percentage terms are unsustainable, house flipping continues to be more common in the faster growing Sunbelt and western US regions, less common in areas of the country with very little population growth and inherent demand. If you are a middle income household just starting out with no inherited house/property, Go East- do not stay in the extremely overpriced western US real estate market.
Without question, flipping is good. Even better would be complete tear-downs of those old eyesores, to be replaced from the foundation up with new, modern construction performed to modern codes.
Well, if you omit the fact, that flipping makes RE unaffordable to more and more people, thereby contributing to homelessness for some, how does that affect your equation, OP? What do YOU think, after you factor in ALL the relevant info? ...
JMHO.
My post yesterday addressed your opinions here with facts countering your points. I'm open minded though. Tell me why I'm wrong.
It is very bad. More and more flippers are turning those properties into rentals (more tax advantages, as well as cash flow), thus further depleting the housing market.
The ONLY advantage a working family has over a cash paying investor is they may be willing to pay more for the property.
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