Hello All,
Happy almost Thanksgiving. I’m Mike, glad to meet you….again. It’s been forever since I’ve been on this message board. In fact, it’s been so long that I had to create a new user name because I forgot the other one.
Anyway, I’ve fixed and flipped a few REOs over the past year on the side, but I’ve not done ONE short sale. Is flipping short sales still (or was it ever) a viable cash model? Is anyone having consistent success with acquiring short sales and flipping consistently?
Thanks for any feedback that you can provide,
Mike in Florida
I am out in the Vegas and Phoenix markets respectfully. Probable 8 out of 10 short sales are to retail buyers and listed with realtors, most of these properties are selling for within 5 or 10% of market value minus repairs. The other 2 out of 10 are being sold to investors processing short sales themselves and there probable averaging 20 to 25 percent off retail FMV minus repair costs.
REO’s out here have been being marketed for sale to buyers within 5 or 10% of retail FMV, however investors are finding banks grabbing offers 25 to 35% below FMV minus repair cost’s offers and banks have been happy to sell to get properties off there books.
There are a lot of investors buying at the auctions, both court house steps and the real estate clearing houses like REDC, these auction purchases can be greater discounts than the REO’s as most of this inventory is either unsold and being auctioned because of no previous interest from buyers.
I would say any of these types of properties could be a good buy if the numbers work!
I’ve got quite a few users who are actively and succesfully doing short sale flips. Although I would say more and more realtors are signing up nowadays. I think the market has 2–3 more years of strong short sale activity before it begins to decline (although I do believe there will be an indefinite short sale market in pockets of the country; just in less volume than we see today). So yes; it’s certainly still possible … house prices are as low as they have ever been and unemployment is just as high, so the distress is still there in heaping piles.