I’ve read many articles suggesting not to flip in 2006. I’m sure this is due to the price correction and there is too much inventory out there. In Antioch CA (zip 94531/94509) alone (where I plan to flip), there are currently over 400 listings in the MLS. It used to be over 600 a couple of months back.
I don’t know if 400 listings (population just over 102k) for one city is too much. It sounds too much to me. I’m sure turn around time to sell is quicker in the warmer months.
Even though bargains can be found anywhere, I’m concerned it will take some time to sell. This past Sunday, there were so much “Open House” sign I lost count.
Should I flip in this city or look elsewhere?
I don’t know if you should you flip where you are or somewhere else? Only you can answer that question. What would make you decide not to flip there is if the market there not conducive to flipping. You need to do the research. In general you flip by buying undervalued property that needs work, putting that work in and selling to get the added value out. If you are in a market that doesn’t function that way, you may not be able to flip there. I don’t think that a market exists that can’t be flipped. Don’t lose focus. Concentrate on understanding these 2 things (1) number of days houses stay on the market (2) can you buy houses that can be bought enough below retail (what houses just like them in the same area sell for) that will allow you to fix them up and make a profit. You need to add in the holding cost for the average days on the market in #1 and fees. If those 2 things are suitable for you, then you can flip where you are. The number of houses for sale is not the barometer you should use it is number of days on the market.
If you think the numbers will work, do it. If not, don’t do it. The numbers will determine whether it is worth it. Don’t worry about Suze Ormon or a USA Today article. Do one deal if the numbers work. Then do another.
Someone’s been reading the Kyosaki bulletin. DON’T FLIP! BUY SILVER!
I’ll be flipping in 2006. Don’t know if I’ll be buying silver though.
Jeff