I have a hud home for sale in my area… $215,000 comps in the area go for $249-269,000, this house is in mint condition…and only needs a fridge, and washer…does hud have restrictions on flipping these propertiees after close? …i mostly deal with mutifamily rentals…but this looks like a good deal for a flipper…also…any ideas on how much to bid? …and how much hud will usually accept lower than there value for the home…

thanks everyone…



First, you’ve only had the question posted a little over an hour and you’ve had less than a dozen views…

The problem with your question is that the answer to most of them is “It depends”…

To my knowledge, HUD has no restrictions on investors buying these properties and flipping them or fixing them and retailing them. If anyone else has other specific knowledge, please provide a definitive source (not “a friend of my uncle knows a Realtor that said…”). I would however, document ever single penny and all labor involved in the fixes if there is a question along the “seasoning” line…I would also take a bunch of before and after pictures. Additionally, I would print a copy of their “Property Condition Report” and keep it on file.

As to how much to bid, “It depends”…in some areas, these properties sit for months…in this area, you need to have a strong offer the day the bidding opens. Usually, the properties here go for about 92-105% of th list price.

How much will HUD accept lower than their list price? Depends…I would guess not less than 10-12% off but HUD is never going to tell you the ‘secret formula’! Like I say, here in this area, the go fast and generally, they go high (but it’s still less than the full value).

Only you know what you can bid…if you’re pretty confident with the comps and the real condition, figure out what you need to make and decide your bid to HUD based on that.


thanks for the advice…this is my first bid for a hud… the property report is excellent, i’ve been by the home and looked around the outside and from the outside in…it’s very well taken care of…looks like they sided it recently, and painted the front fence too…it’s very clean

Why don’t you get a HUD-approved Realtor to show you the property? You’re going to need a Realtor to submit the bid anyway…

yes, i put in a call to him today…haven’t heard back yet…also sent an email…

Is the 9-day Owner-Occupied period over yet?


no, but it will be next week


Can you please xeplain what is the 9-day Owner-Occupied ?


the owner occupied period is the period when hud accepts bids for a property that the bidders intend to owner occupy…this usually takes place before the " investor’s " bid, … if you bid in the owner occupied period, you must sign a waiver stateing that if you " win" the auction, that you will occupy the property as your primary residence for a period of one year… if you sell before that period, hud will take the profit, they do enforce this, and in the waiver it has some clause about being prosecuted for faulsifying documents with fines up too $200,000 and or jail up to 2 yrs or something, … if there are no bids during the owner occupied period, then they open up the " investor " period for bids, … an investor after he closes on the home can do whatever he wants with it…flip it, rent it, lease to own…ect…
i think i got this right…but double check…

Nope, sybadon, you’re right on the money. Additionally, if a Realtor knowingly submits a bid for an investor during the O/O period, they can be subject to punishments – some of them quite severe.


Thanks, guys.

You should definitely check with an agent to see how long you must hold before selling.

FHA loans require that the seller be on title for at least 90 days.

Some REO properties actually have restrictions placed on them by the bank. The agents that are contracted to sell these must tell you this before entering into a purchase agreement.

I would imagine that HUD has similar restrictions as their goal is simply to help prevent the illegal type of flipping.

Investment buyers can’t use a HUD loan to buy the property from HUD…only O/O can get FHA funding. Once HUD has sold to an investor, they don’t really care anymore. If they have taken the home back on a foreclosure, the 90 days has no play any longer.



Are there any stipulations about buying a hud home and renting it out? Does one still need to buy after the owner/occupant bidding period to be able to rent it, or can they bid during the occupier bid time? Is the owner/occupied bid period always 9 days, and are homes quite often bought up during that time? I’ve seen some good deals, but don’t want to violate any state laws

if you bid during the owner occupied period, you must live in the home for 1 yr… if you’d like to rent it…you have to bid during the investor period…


If you buy during the “All Bidders” period, there are no stipulations about renting it out…if you buy during the Owner Occupied timeframe, there is…DON’T DO IT! It deprives qualified folks of property to live in so you can make some money – it’s wrong and illegal. The O/O period is always nine calendar days. Yes, the better homes are often bought during this period. If you bid or buy during this period, you won’t be violating state law, you will be violating Federal law. The investigating authority is the FBI…not really the kind of trouble that you want!