If investors are getting into your local real estate market by participating in online auctions in your area, then get ready to see increased levels of flipping in the coming months. According to Auction.com’s “Real Estate Investor Activity Report,” rising investor action, particularly in high-priced areas, tends to indicate plans for flipping in the near future since high-priced homes tend to be more difficult to rent out profitably and hold wide profit margins for investors who can buy, fix, and flip quickly. The report is based on a nationwide survey of real estate investors who use the auction website.
Investors are showing particular interest in flipping in Washington, Nevada, California, Missouri, Arizona, Idaho, and North Carolina. Nationwide, fewer than half said that they planned to hold properties once they had purchased them. Rick Sharga, executive vice president of Auction.com, noted that one of the best signs that flipping will soon be on the rise in an area is if there is “simply not enough new or existing home inventory to meet buyer demand.” He added that this is certainly typical in California’s market and also in the Northeast. However, investors reported the widest profit margins in the west and Midwest.
by Carole Ellis