Now that the housing market is picking up steam, house flippers are coming out of hibernation with hopes of turning a profit. And according to the numbers, there's a good chance they will.
Leading up to the burst of the housing bubble, flippers were making a killing buying, renovating and selling homes. Unfortunately, this led to investors overextending themselves and eventually ending up under water. Nowadays, the environment is totally different.
Today, house flipping isn't only about buying properties to fix and flip them, but also buying and holding to generate rental income. As rental prices rise, investors will find that it's sometimes better to rent a home rather than sell it right away. On the other hand, in areas like Phoenix, Arizona it makes more sense to buy and sell in a relatively short amount of time.
According to statistics published by Trulia, home values in Phoenix have shot through the roof in the past year. The median sales price increased 35.2%, or $29,950, and price per square foot is up 359.7% compared to the same period last year.
Across the country, Orlando, FL is experiencing a similar boom. The average price per square foot skyrocketed 387.7% compared to the same period last year, which is quite significant. Additionally, the median sales price increased 14.5% to $109,900.
Now that the housing market has bottomed out and statistics show signs of growth, investors are hungry. It is our prediction that real estate investing, especially house flipping, will spike in the next six months.
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