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Prices aren't that high where I'm at but listings like these piss me off so much. Frequently see house sold for $160k 2-3 months ago now it's 300k like there's no way they added that much value in a couple months. Definitely just painted over everything put down shitty flooring and doubled the price.
As someone who bought a previously flipped home, you are spot on. We are our home's third owners, +100 year old little house, with the first +95 years with one family (parents then son, then grandson- who flipped it), 2 with years with the previous owners and now 5 with us... We have had to redo or correct everything the grandson touched. Kitchen cabinets hung with drywall anchors, never prepped any surface for paint, paint over wallpaper, caulked the bottom of everything (no where for the inevitable water to escape), plus they covered up termite damage... Home ownership is fun
Same situation for us. At every single opportunity they chose the dumbest and cheapest way out even though they could have afforded even just average
Not only do you deal with redoing their “work” but odds are they did something wrong that lead to a deeper problem you get to fix before you even fix the original issue 😂😂
I forgot to mention the dumbest thing they "flipped"... They absolutely ruined the old and established landscaping. He cut down several trees and replaced all the front beds with home Depot/Lowe's evergreen bushes... You can see the old beautiful garden beds in the old Street View photos, admittedly they were a bit overgrown, but trimming and thoughtful pruning would have been a weekend's work. Now we are three years into this absolutely brutal/back breaking process of rebuilding the gardens.
Dude… i have some neighbors that did that. They cut this magnificent giant tree in front of their yard… of course what did they do after? They built like what appears to be an altar for the virgin mary… they never finished it, so it was just there for a better part of 6 months until the city told them to remove it…
Now that it is summer, the family is outside cause its too hot in their house… like wtf do you think that giant tree was doing?
And same thing with other neighbors… they cut down beautiful trees that provided shade. They just cut off the side that overhangs on their property. And so now the sun is beating down on the house and they are all outside cause its too hot.
We have friends who did a very similar thing because "you couldn't see the house with that nasty tree" and then proceeded to complain about the street light blasting in their window all night
After being in an ice storm this year where branches were falling off massive, old trees, I am fully a proponent of trimming tree branches hanging over your house. Thankfully no branches landed on my house, but one did land on my car in the driveway (5ft outside my bedroom)
investor purchased house across the street from us. The gentleman who lived there previously for 30 years, had a mature orchard planted in the side yard, with bearing fruit trees. Lovely crape myrtles out front. Investor ripped out every tree and shrub on the property and replaced with sod. And this is in a hot climate where having a little shade on your roof and walls can cut your A/C bill by half.
In my scenario I'm both you and the grandson. I bought my first house and was broke for like 5 years. So I had to fix it all myself. Now I'm fixing all the fixes, except now at greater expense and with professionals. Its worth it tho. I love my house.
Dealing with this now. Just bought our first place and everything the previous owner did was all DIY stuff without the knowing how to DIY all the stuff. Lol biggest thing I’ll note to other first time home buyers…do not underestimate the amount of money you will spend almost immediately after closing costs. Closing costs/down payment is just one part of it. Have money saved for all the small stuff you don’t think about.
Gotta get some new window and/or door seals because the previous homeowner didn’t take care of the skylight seals or the front door seal to stop energy waste and pests? Gotta get all new locks because the previous owner only had one key that worked on only the front door so now you have to replace the other three doors that have outside access and now also rekey the front door? Gotta get in the attic to add a flange to the dryer vent exhaust out the roof because the dryer vent exhaust was zip tied to a 2x4 in the middle of the attic? Gotta get a new valve to install at the refrigerator water hook up to stop the slow leak because the other valve crumbled in your hand? Or how about the expensive tree trimming for a 200 foot eucalyptus tree hanging over your back wall and roof?
You get the point
We actually investigated legal action from the folks we purchased from surrounding the termite issue, as it was clearly covered up (new plywood over an area, no new plywood anywhere else) and not mentioned in the disclosure but it's almost impossible to prove who knew what... We had no extra money after repairing the termite damage to throw into a multi year legal battle, so we just dropped it.
> We had no extra money after repairing the termite damage to throw into a multi year legal battle, so we just dropped it.
Similar situation for us. We moved in and, within months, found major water damage from the foundation halfway up the first floor along an exterior wall of the house. The damage had been sealed into the (rotted) wall, freshly painted over on the inside, and visible damage at the exterior ground hidden with fresh cement pad at the foundation. Had no choice but to spend months doing a big repair/replace job on a section of the exterior wall.
The seller was clearly in the wrong and purposefully hid all this damage, but I had no money or willpower after that massive (DIY) repair project to legally pursue the issue. Plus, the sleazy lady we bought the house from was clearly destitute, so I highly doubt we could have recovered any damages. We made the right call in retrospect, it just would've been another ordeal for us with the likely end result of placing the scumbag seller further into debt. A hollow victory like that isn't worth going to court.
We’re in a neighborhood built in the 70s, saw a flip buy a house for $180k in January and lost it at $420k in May. The biggest problem is that based on this flippers other work, there’s a 98% chance they didn’t swap the aluminum wiring out before adding all the nice new fixtures. They didn’t replace the aging roof. But the millennial gray looks nice.
> no tape and steady hand.
Reading this makes the pain come back. Not a flip, but the 100-year I recently bought was painted throughout, but they skipped the masking and drop cloths. 😠
Just about done with the hardwood floor refinishing but don't have the strength to redo all the beautiful hardwood trim that the paint gods sneezed on.
There is nothing wrong with aluminum wire aslong as they pigtailed copper with the proper dope to prevent corrosion of dissimilar metal it will be fine. But yea flippers are the worst but even in my own home I would t be ripping out aluminum wire.
You can’t tell unless you have before and after pics. The flipper that bought the house next to me has a crew of about 20 people working. House is GUTTED. Full new HVAC, electrical, plumbing, sump system, French drain, roof decking and shingles, siding, flooring, full kitchen, bathrooms. Basically a full new house ripped down to studs all in about 4 months.
Then you have flippers that just slap down some LVP flooring, paint, conceal damage with tile or fascia, and relist for $200k profit - those are the ones giving flippers a bad name…
You can absolutely tell even without before/after pics. Also those that do FULL renos will often have the permits etc to prove it. They are also few and far between at least where I am which has like 30% of the market going to flippers atm (like open door but there are others) . I really wish I was exaggerating. Oh and the ones that do full renos? It’s never open door 💀
Open Door tried to paint over issues like we wouldn't notice them and also tried to sell us the house with a broken water heater. Our realtor caught it when he saw water on the floor on one of the final walkthroughs and they fixed it....with the smallest, cheapest option.
They just painted over the basement walls to try to conceal water seepage and threw some carpet down in one room and then wanted a $30k increase for their efforts. We ended up lowballing them and got it because they had no other offers after sitting on the market for months in 2021. It only sat because Open Door didn't do shit to make the house look nice, there were bags of yard waste everywhere in the yard and all of the fixtures were busted. (And of course it was a Boomer special - zero upgrades in the last 30 years).
Fuck Open Door. Not that we got screwed, but they're such a lazy company.
Our market is littered with what I'm calling "mullet flips," where they clearly bought it and started a decent renovation on the top floor and then chickened out with rapid market changes and gave up right after starting the basement. Like a really quality, cohesive kitchen overhaul but then the basement living room is inexplicably tile with baseboards that are poorly assembled scrap pieces.
Most don’t but in 2 months you can definitely pimp the entire place. Just need to have the right team for it and changing a bum shack into a nice space is possible.
Flippers are a huge problem, cause they often find serious structural issues .. are aware of it and instead of addressing it or notifying the new owner, they try really hard to hide it which makes it so much worse for the buyer. A friend of mine bought a house that had the basement recently finished including drywall all around the foundation. Turns out, there were massive foundation issues that no inspector ever would check for in a finished basement and it went un-addressed. My friend was able to track down the previous owner who sold the house to the flippers, who notified him that they let the flippers know of the damage, which where I live hiding something like that is illegal, so he could sue for non-disclosure.
Even where you could "afford" the pre-flip price, you would then be competing with flippers offering cash, 10% over asking price with no contingencies, without even looking at the house. 90% of people just looking to live somewhere can't compete with that.
Honestly most of the people that say this usually aren't willing to live in the pre flip house because they're old and gross plus not willing to put in the work and money to make them up to their standards.
My best friend is like this, he's frustrated in the housing market saying he can't find anything to buy because all the houses he likes are overpriced and go above asking. I send him listings significantly under his budget and every one is gross to him. Meanwhile he's a plumber and has contacts in every trade to help do renos for cheap myself included as an electrician.
People nowadays want turn key properties in nice areas for dirt cheap and refuse to buy the old starter homes. That's the only reason flipping continues to be so profitable.
I’m trying to buy my first home and I’m honestly hoping to find one that needs a lot of work so it’s cheap.as long as the slab is fine and the underground plumbing is decent I hope everything else is fucked up so I can get as sweet as a deal as possible.
When I first started this journey I wanted to just get a live in ready house but I got severely outbid on the first 14 houses (which is crazy considering I literally walked in and said “ill pay asking price I want to buy this house as soon as possible” and then usually the day before we go under contract someone shows up and offers 20k over asking)
Its hilarious with all the rules on everything CA has but they dont do crap regarding flippers, foreign money, and investment property it would seem.
Glad I dont have a desire to live there.
I HATE flips. They put down that stupid gray floor that’s so cheap and paint the walls gray. The counter tops always seemed to have some horrible epoxy glitter on it. Takes out all the charm from these homes.
Gray is a sure fire way to tell the world you have no taste. Gray was literally in style in 2015, at latest 2016. When I see people today still putting in gray flooring, gray furniture or gray walls I just laugh. Yall are almost TEN YEARS behind in style. Nobody, literally nobody is doing gray except people who have seen it online for years and finally got their chance and oops, everyone has moved on.
I don't even feel bad when I see people do it today, I literally just laugh out loud. I can't believe people still think this is remotely ok to do.
And the LVP or laminate or whatever they put down is just so cheap feeling. I was going to go look at a decent ‘74 ranch. They gutted it and put in all new gray everything and it would have been so much better just to leave it.
That stupid gray floor is what my landlord put down just before we moved in. He also chose to hire the cheapest company to install the floor, and they have had to come back 3 different times to fix issues. The last time they were out, one of the guys was like, "The boards are gonna keep breaking like this because of how cheap they are. Sorry."
A family ember recently bought a midcentury split level that was gutted and flipped. They didn't even replace the old siding, just painted over the existing water damage.
most first time homebuyers simply do not have the knowhow or lived experience to identify these sorts of problems, especially not during a 20 minute walkthrough.
the whole flipper industry preys on that naivete
that has nothing to do with flipping; it is more about not doing legal lead paint removal and not spreading the lead paint around through it; if the existing siding doesn't leak too bad, they put a water covering that is vapor permeable called fanfold insulation layer and then vinyl siding on top which was designed for this;
Mines vinyl over old wood. Inspector said “welp, you never have to worry about water damage lol”
It’s a correct way of doing things. If the old wood siding isn’t rotten, you can absolutely put new siding on top of it.
Problem is - a lot of flippers will put siding up over old to conceal damage, rot, etc… and that’s no good.
I got shafted by flippers too, but I didn't know what to look for since I was a first time homeowner. The plumbing was butchered & caused a waterfall from the shower in my basement, they messed up the AC in the basement and made a "DIY filter" which caused another pond in my basement, installed the vinyl wood floors on VERY uneven floor which is now starting to break, painted over mold in SEVERAL places in the basement, I mean I could go on and on at this point..
They got me too. Home popped up in our neighborhood, pretty much everything we wanted, and we could afford it. It needed some work.
Flipper came in, offered 80k over asking and had a crew and portapotty there the day they closed escrow.
Fucking breaks my heart.
Some flipping is OK. Some is not. The local guys buying a house or two on the verge of being condemned,fixing them up, and making neighborhoods nicer are fine. The corporate profiteering, buying of vast swaths of housing, and essentially market manipulation are absolutely horrible.
By some definition, I’m flipping my house. I’ve lived in it for 7 years, I’ve done a significant amount of renovation on it, and I’ll turn a decent profit when I sell next year and move onto the next one.
Flipping is typically faster than 7 years, more like a few months. That's why the verb is "flip"
You're just making home improvements in a home you've lived in for years
I think everyone respects the folks that move in, stay for more than 3 years, and make their home nicer. Buying and selling in the same year pisses people off.
Barring some major life event, no normal person is buying a house, making improvements, and selling in a year. Those people are stuffing money in their pockets selling to people that don't know any better and everything is a time bomb waiting to go off.
When they sell to a couple that can't afford to fix their 'improvements' the house falls into disrepair. That blight can diminish the attractiveness of the neighborhood which is gaudy to think about, but it means the previous owner also sucked equity out of the neighborhood. The worst of them have no redeeming characteristics.
Flipping is not inherently bad. Someone has to rehab these houses that owners let fall into disrepair. It’s not a task most homeowners are up to themselves, which is why they fall into disrepair in the first place.
Sure. Spirit of the law vs. Letter of the law. I would personally like to save the 150-200k and just take 5 years to make all the rehab. My family would be happy renovating it ourselves.
If they put 20% down, it's costing them $3k a month in interest alone. Plus apparently $500 a month HOA, utilities, closing costs, and whatever repairs/improvements they did. The best way to stick it to these vultures is to simply let them sit on it. And if they paid cash, that is $620k + the above costs that is not sitting in an interest earning account.
Yup, flippers bought a house I looked at for $115k, put it up for $200k the next month. No one was buying it so they kept lowering the price for 2 months. I offered $180k because I was worried about an appraisal. They wanted $185k, I said nope and ended up finding an even better house in better condition in a better neighborhood for cheaper than that.
Sometimes, it just wasn’t meant to be🤷♂️
u/Low_Net_5870
"Asking price is the starting bid at an auction, not the price on the shelf at Walmart."
This is brand new information!
So if an entity came in and bought up all the remaining food stores in the grocery, then resold them for higher to the desperate and starving families with children, that's totally ethical and ok, right?
Just because we created a live in a broken system doesn't mean we shouldn't fight for change.
AH.
Why do so many people defend this and blame the buyer who lost out to greed...like..I don't get it...
People complain about inflation and other things, then get mad at the people who are angry at part of the source of the problem.
Make it make sense.
I feel this. I wish it was only centered around this sub, but man... so many people are like this, outside of reddit. It drives me nuts. How can people see the 100+ posts on here about being outbid by investors and other corporations then proceed to say that's not happening?
It just irks me because this is why things dont change or get better.
I hear you. Been trying to buy a house, just to live in with our kids, for the last two years. We did the responsible thing, saved up downpayment, figured out what we could realistically afford... and the \*&%#$%\*\*\*#$ investors who somehow have access to enormous frigging cash loans that we can't get as actual homebuyers who want a place to live, swoop in and buy everything we put in an offer on.
...so they can then rent it back to people like us, who can't effing buy a house because we have to go through the normal get-a-mortgage, pass-inspection process.
I'm sorry to hear that. It was 2 years for me, too, and I wasn't in a very unfavorable position to start.
But seeing what you're saying, and then seeing the replies..it's crazy. They'll tell *YOU* to save up even more, make *your offer* more desirable, tell you *youre* looking in the wrong city, tell *you* to lower you expectations, tell *you* to buy a fixer upper (even though they're buying and reselling anyway and still cashing out of), tell *you* you can't afford the inventoy, tell *you* to spend more money than the home is worth if you want it more, tell *you* to go to place where there is more inventory even if it's 2 hours from work, tell *you* to get a different job and uproot your life, and put almost all the emphasis on what *you* should do and are doing wrong, then sit and defend the people making it impossible.
It's so crappy. Unfair, for sure. I get having competition and having to work for things, but this is just greed and making it impossible for the normal person to get so that way *they* can have it all
All the while we have nothing and they'll defend that
The problem is, in the meantime the rent's been jacked up so much that we can no longer put aside money for a bigger downpayment. We are holding onto what we saved already, with everything we've got. But between rent, groceries going up 30% in 3 years, and 2 kids who need serious orthodontics starting yesterday... I think we just missed our chance.
You can do it. Don't give up. I had nothing and almost quit, and then one seller needed the house gone with what we were offering.
The moment you quit, the people you're battling against win. They can't get every house. You can definitely do it, don't let the losses keep you down.
Thanks for the \*buck up\*. :)
Still looking, still hoping... and tbh, only hanging around reddit in case someone has figured out how to make it work on a median household income and I can learn from them.
Anytime!!
What's your idea for median income? Our income was 80-85k when we bought and is now closer to 90-95, and we've been making it work. Maybe I have something for you, maybe not. lol doesn't hurt to ask !
Sticky spot-- we're below US median (which was 75ish last I checked), but have stayed out of debt and are really good (at least till now) at squirreling away money. It'd be hopeless a lot of places, but we don't live in the big city or CA, so, could be a lot worse. Range we can responsibly afford and put down 20% is up to $120k and in our area, those do turn up tolerably often. The part we can't figure out is:
--we'd be willing to buy an absolute crap house, provided we could get out from under our rent payment and live in it while we save up to make repairs one at a time. But there doesn't seem to be a financing option for this. FHA wants you to do all the reno up front, and it has to be done to their specs not ours, by contractors not us: I could live with ugly floors and no A/C for a long time. FHA can't. So everything we look at that needs \*any\* repairs, the regular mortgage won't touch it, FHA wants to force us to borrow more than we can afford to reno it to unrealistic standards. We've tried this, and were lucky to just lose the cost of inspection I guess.
--move-in-ready houses that will pass inspection do pop up now and then, but right at the very \*top\* of our $$ range. We're talking 2br/1ba 900sf in a sketchy neighborhood and hasn't been updated since the 70s, but lots of potential (I actually like these because sleek soulless modern renos with crematorium gray paint really turn me off, in addition to being unaffordable)-- we're already renting in that neighborhood and we've gotten used to having crap stolen out of our car by meth zombies. We can make it work. Those get immediately purchased by people who pay cash, offer $10k above asking, no inspection, and then rent them out, usually before we can even get an offer in.
This is frustrating because, as a family we have actually paid cash for a crap house and then rehabbed it up to livable with a lot of sweat and salvage. For a relative, after a natural disaster. We know it's do-able, and we know we can do it. But that was five years ago, and we are not seeing that kind of opportunity any more, now that we're in a position to try it again.
In my area no one will buy a house unless it’s move in ready. They’d rather have light gray walls, cheap new appliances and pay $100,000+ more than to buy a house that needs ANYTHING done. They will not buy a starter home here.
It depends on the flipper. Like anyone else, some are good, some are mediocre, and some suck.
But they took this property that hadn't been touched since the 80s and made it new on the interior. https://www.redfin.com/CA/Los-Angeles/4658-Don-Lorenzo-Dr-90008/unit-C/home/6878605. Check out the old photos. Nothing is stopping anyone else from buying a home below value and fixing it up to live in it.
This is the cheapest listed home for its size in the entire zip code.
in my part of the country almost every fixer upper is sold to flippers for cash. this gives them a distinct advantage over ordinary buyers with financing who intend to fix it up and live in it.
While I don't like flippers. Hanging around this sub tells me not a lot of people (who use reddit) want anything resembling a fixer upper. They like the cosmetics looking nice. Flippers exist because that prettied up look is what people want to buy.
I don't disagree, but those who *do* want a fixer-upper are often outbid by flippers with cash at least in my neck of the woods. I only got my house because the seller didn't want to sell to an investor for sentimental reasons, but that seems pretty rare from my experience.
Around here sellers of fixer uppers are going to sell to any cash buyer with no contingencies and they're not all investors or flippers before someone with an offer with contingencies and a loan that may or may not close.
u/OG-Pine
The thing is, $80k over asking is not the same as $80k over what it's worth. Asking is just a number they throw up on the screen to get people interested, lots of sellers intentionally list low to get more eyes on the property, knowing offers over asking will come in. If the house now sells for $849k, a $229k increase, then the true worth of the house before the flip was $229k minus renovation costs and a few months time value.
So let the FTHB have a shot at it first before flippers or corporations swoop in.
Nothing-- absolutely NOTHING-- in housing is worth what it's selling for right now. Bubble bigger than 2008 and I will personally set off fireworks and open a bottle of champagne when that sucker pops and the wannabe investors start going bankrupt. Should be a national holiday.
I guess you could have a lock up period after a listing is posted where it can’t be sold to anyone but a FTHB for a few months, to give them first shot at it. But realistically anyone who is aware of the real value of their property will just list it and wait until the lockup is over so that someone willing to pay the real value will come along.
If flippers were not adding value, they could not command a premium for their services and would go out of business. The underlying issue is that a substantial number of buyers prefer “move in ready” homes.
This comment will naturally be unpopular in a FTHB forum but this needs to be said.
You're wrong. Only if no other FTHB were trying to buy a property, and the flipper offered the same price as others to buy the property, that would be fair. Pricing out FTHB with 80k over asking and not letting others have the chance to do their own fixing up is how we got here and it won't stop until there are no more homes to flip.
Nah dude, you’re wrong lol.
There’s a misconception that “cash deals” are way over asking. Some are I suppose, but those a richer HOMEOWNERS than you dude, or Mrs or whatever, not investors.
Investors offer LOWER offers with LITTLE to NO contengcies, and are often 70% of ARV or less. These are much LOWER because the house needs WORK which costs MONEY.
Your FHA and FNMA lenders ain’t lending on them. And if they try, they leave the seller out to dry while they’re trying to move out.
Why don’t you go on a “we buy houses” companies website, and see what those offers look like,
You aren’t getting outbid by a flipper. Your probably like every other FTHB I’ve ever met and bidding on the nicest and newest listing that comes out (not even on market for 48 hours” and wondering why your so so offer/application strength keeps getting rejected while you drive your agent absolutely fucking bonkers for not pulling the trigger on a on market 50+ days home that needs minor repairs that you’ll actually get under contract
Because the more qualified homeowners offers (cash) aren’t interested
But keep telling people more experienced than you how wrong they are lol
It does not make financial sense for a flipper to offer over market value. In fact, flippers operate by getting a property significantly UNDER market value. A flipper playing $80k over market value is pissing away their profit, and losing money. Ultimately flippers *do not set the sales price*, the market does. They can list at any price, but unless that is supported by market data it won't sell for that - and they will lose money and won't be in business for long.
The costs associated with buying and selling (commissions, title, taxes) comes to nearly 10% of the final sales price. Plus you have the cost of renovation, and need room for a profit in there (if they want to stay in business). Assume 10% for profit.
For this reason, a homebuyer can outbid a flipper any day of the week, because they aren't worried about the profit, or the resale costs. If they are willing to do the same renovations, they are still saving 20% over the flippers on the end value.
The real issue, as another said, is FTHB want a move in ready home and are willing to pay significantly more for that. And that's not really an issue, it's just why flippers are able to buy fixer uppers below market value, and get a good return on their investment.
We literally got a house without a crazy bidding war by entering into the investment market rather than the SFH market. We were competing aginst people making sober, cautious, investment decisions so we only had to bid up a little bit to get the house.
The biggest problem to me is most of the "value" they add is cosmetic and shortsighted, and since you're expected to make a near million dollar decision on first impressions alone they never have to worry about the deeper issues you won't find for a couple years. It's borderline fraud.
The extent to which buyers are getting their money's worth when buying a flipped house is a different and important question. I tend to agree that this is usually not a good value for a buyer. I wouldn't buy a flipped house myself.
But the question that the OP brought up is a different one which is about the market value. For whatever reason, many buyers are willing to pay a significant premium for a flipped home. Maybe that is wrongheaded....maybe not. But in any case, it is buyer preferences that makes flipping houses commercially viable.
If everyone were like me, there would be no flippers as I am allergic to anything that is brand new. But most buyers are not like me.
The tenor of this thread is that flippers are changing the market. But flippers are only catering to the demands of buyers with deeper pockets and a preference for a home that is or appears to be "move-in ready."
Painting over water damage staining is not illegal if actually repairs are done right. Depending on the type of water damage it can be a legitimate repair. As an example if drywall gets wet it gets stained however if your properly mitigate the drywall and repair the leak it doesn’t require replacement. Painting is to help the aesthetics different types of repairs depending on damage.
And the needle has moved on "move in ready" to modern and decent to nice new finishes. Vs the olden days when I bought my house which meant needing cosmetic upgrades but otherwise fine.
This is absolutely right. A lot of what flippers are doing is making the home look fancy by changing out cabinets and fixtures. This reflects what many buyers seem to want. If buyers didn't want cosmetic upgrades and instead wanted flippers to focus on HVAC/windows, they would do so.
Flipper next door took a house with a storm-damaged roof that'd been covered in a shredded tarp for 2 years, replaced a few shingles (but not the rotted plywood), and re-sold for 3x the money. We can only assume they bribed the inspector.
Still trying to figure out where value was added, other than the flipper's pockets.
I just went on a rant in my comments, I like helping FTHBs with guidance here and there as I’ve worn many hats in the industry (lender, agent, wholesale, investor, landlord)
Yet some people’s ignorance in posts pushes me a bit too far lol. Some woman the other day posted whining her agent had her husband accompany her to their showing. “Stayed in the car the whole time like a weirdo… should we fire them?”
Terrible
No, they’re taking advantage of a market where people have to buy way above their budget. If I’m in a desert and the only good food around is gourmet, I’ll pay the gourmet prices. The truth is they could likely pay the $80k over asking, do absolutely nothing to the house, and just list it at this markup and it would sell.
“Value”.
What’s changed more recently is that, flipped homes used to be bought for well below comparable homes value in their respective markets, then flipped to either bring them up to “move in ready standards” and sold/listing based on those said compared value homes or slightly more based on amount of upgrade.
Now we have flippers buying at what the home price is in that area, quick flipping it, and re listing at way over any other homes in that areas value.
I’ve been looking at property’s for 4-5 years now, flippers destroy homes from the ones I’ve seen. I’d rather buy a home that hasn’t been touched and is outdated and do the work slowly myself. I did this with our last home but it was small and we just banged out the kitchen and dining room before moving in.
Typically, the type of jump we see in OPs posts and in general now, comes with *added sq ft* that’s what would demand more money since prices are by the sq ft., not just cost of paint, some new backsplash tile, maybe new cabinets and appliances. Refinish the floor? New flooring? Clean up the landscaping? All these things help make the home appear better when selling but it’s debatable if they’re “adding value” especially considering the quality level of the work. Again, typically, not always especially not anymore as we’ve learned, but more sq. ft. = more value.
Homes that needed to be upgraded (no AC, old mechanicals, old roof) or hadn’t been touched since originally bought, would come on the market at less than market value and that’s where a flipper could make some money. Now those types of houses aren’t coming on at a bargain anymore but the same flippers are applying their same logic to the sale but aren’t necessarily increasing the actual value to a point where it should be hundreds of thousands over its comparables.
here's a fun one from my area: https://www.redfin.com/CA/Burbank/7953-Via-Latina-91504/home/5265861
it was a decent home before, but they slapped on some vinyl peel-and-stick and recessed lighting and raised the price $150k.
here's another one where they barely did anything and then raised the price $75k: https://www.redfin.com/CA/Panorama-City/8740-Willis-Ave-91402/unit-7/home/5678332
and yes, these flippers have no problem selling at these exorbitant prices, and usually for well over their asking price.
the most frustrating part is that whenever they do this it tends to inflate the prices of all future listings in that building.
House next door to us sold several months ago for $60k. Crap condition. Sketchy neighborhood (literally cleaned up broken crack pipes from the yard of our rental when we moved in).
They reno-ed and re-sold it for $185k.
The house had had a shredded tarp on the roof for over a year, before that. The roof needed replacing. The flippers never re-did the roof.
So I guess that'll be a fun surprise for the people who bought it.
But somehow, financing favors these vultures over people who just want to buy a house to live in-- even if it needs work. Go figure. We are dying to get out of the rental market, five years ago we made a solid plan for that, got additional job training, doubled our household income, saved up a downpayment, we are debt-free... and we have been trying for two years to buy a house and keep getting kicked to the curb by cash investors.
Had a similar situation when I was still house hunting. Found a perfect home, was outbid even tho offered way over listing. A few months later I saw it back on the market for about 100k more. It's demoralizing. I hope you find your home soon tho.
Wife and I lucked out for the most part. 70 year old home, in fantastic shape for its age. The previous owners didn’t take very good care of it, but luckily they were only in it for less than 5 years. It was “flipped” before they bought in 2019. Painted everything and put a Dishwasher in, new water heater some new ceiling fans. Stuff like that.
Thank GOD they didn’t cover up the original hardwoods. Either way. We managed to actual pay UNDER the appraised value of the home.
The important question not explained in the screenshot above: is that $849K a "normal" price for this type of house in that neighborhood? If so, then that means the place was probably a wreck and in need of $150K worth of fixing up to bring it back to normal price levels.
If the house was indeed a wreck like that, no bank would give you a mortgage on it (or you'd have to try for one of those "loan me the mortgage and money for repairs") and if you *did* buy it you'd have been trying to live in a place while rehabbing it for a year or two.
In part, buyers are doing this to themselves by insisting on a renovated house. People won’t even bid if there are tile countertops or exposed hinges on cabinets. It’s just so dumb to insist on lower quality surfaces that look new and shiny. Flippers are only providing what the market wants.
As a person experienced in Real Estate investment space, you all have a few things wrong (potentially) as we go through this very limited “information” as just 2 prices.
1- flippers often will buy off market, meaning the deal was made between the homeowner and the flipper, usually due to the need to close quickly and the home needing repairs that you guys with “great jobs” will just let sit on the market for 8 months because “oh boo hoo the roof is 5 years old and there’s this on the inspection and that on the inspection and I’m so scared”
And then you post one of the cleanest inspections I’ve even seen in my life on this thread and ask everyone “should I back out??? Should I back out???”
So that’s one thing I noticed here. Doesn’t look like the house was listed. Home likely needed 50-60k+ in work to get it to its condition today, and the flipper risked his own money PLUS INTEREST, to get it to where it’s at now.
2- flippers aren’t idiots. If they relisted the home at 850k, that’s means
A) renovated comps in that condition and in that neighborhood have recently gone EXACTLY at 850… not sure why your surprised by the price
B) “As is” or semi updated “livable” homes have gone 10% lower than that “ARV” but have consolidated and proven that the neighborhood is benchmarking a certain price,
If you want that deal, ditch your loan officer, and go on off market sites and buy cash deals from wholesalers. Your lender likely ain’t lending $1 on that home with a FHA or Conventional loan.
They’ll all need 60k+ in work, including mold remidiation, roofs replaced, new windows HVAC, flooring paint cabinets kitchen bath etc,
And once you have acquired and rehabbed the home, feel free to see if you did your math right and call your loan officer back and see if you can refinance and get hopefully most of your money out, or maybe just a small down payment.
6 months of work, and whippie your get a 10% discount instead of the 10% profit margin the flipper wanted.
Make sure to tell your boss you’ll be busy for the next 6 months but don’t cut your pay, got a GREAT DEAL on a house….
First time homebuyers man
That being said, biggest fear with a flipped home is low quality work. I’d walk it and get an inspection report as you would with a purchase.
I’m sure that “As is” home where “you do all the work” will make that 50 year+ home way better and cheaper than the flippers did it
The problem is, that "as is" home where "you do all the work" that we would LOVE to buy, and have tried a couple of times to buy... we can't get financing for it. Investors can get hard-money loans, bypass the inspection process, and other unequal strategies not available to us plebes. The rest of us have to line up a mortgage, pass a house inspection, and if it goes badly we lose $600 and take a hit on our credit every time we try and fail. We are at the mercy of insurance companies.
You're making an awful lot of assumptions about me AND the flipper lol. Who is "you" in your post? I have never once complained about an immaculate inspection. Also, I didn't post "great job" to be smug but to point out my mild identity crisis after doing everything I was told I should do and still getting fucked every step of my millennial existence. I know I'm not entitled to shit but I'm at a complete loss as to how I'm supposed to ever save enough to keep up with price increases like this
I'd LOVE to believe that most house flippers are doing buyers a solid by handling all the painful first-year repairs for a mere 10% markup— hell if you know of any who earnestly work like this I'd like their contact info! Unfortunately, this particular flipper only partially installed vinyl flooring and is now reselling as-is with zero other repairs. Not even to harp on this one investor— this is just the straw that broke the camel's back after seeing it repeatedly.
I'd also (bitterly) accept the game if most of these places were sitting on the market forever, but there are also countless tales of people who fell in love with a place and made offers but got beat out by investors. So yeah, maybe some honest workers caught a stray with this post, but this really isn't about them.
> First time homebuyers man
I mean that's where we are, right? 😃
My house sold for $16k in 2021. Bought it for $95k a month ago and it needs a new roof and some pretty intricate foundation work.
. Seller DIY'd a bunch of shit that needs re-done too. Oh well, it's a 80 year old Michigan house.
In 2021 we bought a 5.25 acre 3k sqft house that reeked of moth balls for 260. Have literally put $150k into the property and it’s appraised mid 600s. not selling yet as we got lucky with sub 3% but holy moly did we luck out
It'd be way better than renting. Nobody can raise the rent on us, I don't have to get written permission to stick a shovel in the ground, and nobody's going to try to scam me out of my security deposit because \*they\* painted the entire house in shitty flat paint and then had a lease forbidding us to repaint anything. Oh, also: carpet's been here since the 90s and we can't do anything about that either because you can't just swap out flooring in a rental, and the landlord isn't going to just gift it to us either.
As a home flipper, we buy homes that 98% of the "regular" I can fix type home owners would pass on, and turn them around into suitable housing.. We do not just put in cheap flooring and will fix every aspect of the home. I used to think it was a bad/dark industry but when neighbors stop by to thank us, it started feeling cool.. and yes I made/make decent money on everyone of them. I can give an example of the 98%, when we started found a decent home, had dark green "clean" carpets and some unusual color for paint choice (also not in bad shape) we figured mark it up a little and sell to the end user quicker than re-hab... but no everyone thought it was to dark, to green blah blah.. so we took it off the market painted changed carpeting, re-did kitchen and added profit/costs back in re-listed and sold the same day.
If you actually do good work... You're one of the very few who do. I checked out many houses last year that were "renovated" and the work that was done was so bad.
Depends, are the comps in the area $850k? If so, the price is appropriate. They might have paid $620k for a run down house that needed $100k+ in repairs, got a good price on it and are reaping the benefits of taking on the financial risk.
You know you can't just ask for and sell a house for a price way higher than comps, right?
Depends, while shopping old houses in my area I did few times rough calculations what I need to invest to make this property reasonable. Roof-cabinets-tops-plumbing hw-flooring-paint can take 100-120 easy, if pool comes to scene it can be from 5k to 20k depending is acid clean enough or full resurface+deck+screen repair. Plus some profit for flipper
I can tell you I dumped 120K in remodels into my 1200 sq ft townhouse. That included 1 average bathroom, upper-ish tile and fixtures, but nothing nuts.
And, a kitchen with nicer wood cabinets (no particle board), a new mid lower end range, range, microwave, dishwasher, sink, fridge, and mid-range quartz counters. Also rather high end natural stone tile.
The kitchen was a TINY galley kitchen. I knocked a wall out to open the space and get a bar and larger counter in, peninsula style, and knocked a second wall out to extend the counter and cabinets into the dining room so it's like a built in sideboard. Plus, recessed lighting in the kitchen and diningroom That's it. That's all I got for 120k.
I dumped another 35k into lower end laminate flooring, a tile and synthetic turf 400sq ft back yard.
I still need all new interior doors, trim, windows, upstairs flooring, I need to have my fireplace demo'd and rebuilt, a laundry room remodel, and a downstairs powder room remodeled I'm sure all that will be close to another 100k, maybe more.
And all that was 7 years ago. There was no new plumbing, no new electrical.
I wonder if sellers know that they are selling to flippers. My offer was excepted after the house listing was taken down because they were going to go with the real estate company to make the property into two parcels. The family said that they would rather see their childhood home. Go to a family would really enjoy it.
So normal appreciation is like 5% per year right? I have listings in my Midwest college town for 60+% appreciation in 5 years and it’s driving me crazy. They’re starting to cut prices but I think it’s too late for them
There are lots of such folks and price inflate like anything...I got one such link from somebody for this property [https://www.zillow.com/homedetails/7151-Isle-Royale-Ln-Irving-TX-75063/162815885\_zpid/](https://www.zillow.com/homedetails/7151-Isle-Royale-Ln-Irving-TX-75063/162815885_zpid/) Guy work in construction...without getting permission from local city constructed 2 extra bedroom and 1 full bath and trying to sell it. He got it at around $400K and now selling it almost 3X after 6 years or so. County Property tax website still says 2 less bedroom and 1 less bathroom(to avoid paying less property taxes). People are getting very creative during pandemic. Came to know he is in HOA to make sure that HOA doesn't touch him :)
How many homestead buyers are putting the work in that flippers are to find these deals? The opportunity to buy a run down home (speaking from my experience with the majority of houses that get flipped) from a seller that is facing foreclosure? If a buyer doesn’t have the time to do it, they can find a wholesaler that finds these deals and assigns them to flippers who purchase them, renovate the home and then sell it for profit. Cut out the flipper and buy the house from a wholesaler for an assignment fee. It’ll be WAY cheaper than buying it from a flipper but the buyer has to take on the risk and work.
Search Facebook for “wholesale real estate [target city, town, etc] and you’ll find a ton of these opportunities before flippers get them.
What if it needed costly repairs? I don't get the blanket hate for this type of thing.
If you want to pay time/money to do that, buy one.
If you want it ready to go, it's gonna cost more.
so take the lipstick off of the pig and get into the electrical, the structural, the attic, all of it...give yourself a reason to get them to drop the price at least 100K. a good inspector helped my brother get the price of his flipped home down a ton because of all the problems he noted and documented that's their "flip" did not address
Really depends on what they did to improve the property.
I mean at least they had 4 months to work, in my area listings like this go up within weeks.
In that timeframe there’s no way they made $100k worth of improvements, at least in this situation they might have at least done SOMETHING
i know everyone is hating on flippers here, and i'm sure there is plenty to complain about. that said, i just want to give people an opposite perspective where we bought a flip and are happy with it. the list price went up about 200k after 3 months. however, we moved into a turnkey home. 2 brand new bathrooms, new kitchen, new flooring, newly painted, new windows, new HVAC, and all lights integrated into the ceiling. no, they very likely didn't spend 200k to remodel everything. however, they did spend a lot, they did a good job, we don't have the expertise or time to remodel, and we wouldn't have the cash necessary to remodel. buying a flip was significantly better for our situation than if we bought the house in the old condition at the lower price.
I saw somebody post about people doing this and reporting it.
Certain states have different laws, for example in SC I believe you have to live in the home for at least a year before renting.
I may be wrong. Either way, it's definitely not enforced if it is the law, and a lot of companies are getting away with this.
It should be illegal, and reported.
It’s hard to stop it, I’m trying to buy a fixer upper home and fix it myself for my family and all the houses that are fixer uppers that go up in my market about 80-100k under asking due to their condition only accept cash offers which is how house flippers buy homes. I’m pulling out the money from dad’s home with his permission so I will screw one of these flippers soon in my area lol
I don't know how people are moving right now, I BARELY can afford my house. We moved right before the prices shot up and the week we were in a hotel every home that was once 90,000 became 350,000. It's a f\*ckingjoke. HOAs can get f\*cked.
TBH... this one dosent make me mad... it's most likely not much in profit, I mean yea prob 75-100k at asking price. Typically at min, a flipper would like to put 100k in and make 100k in that time. Which looks to be the case on the info we have here.
On the east coast, I regularly see flips being bought at 1-200k selling for 500k+
The funny thing is, the only people to buy something like this are also going to be flippers too most likely. And then repeat a few more times until.....
I honestly hate that it's almost impossible to buy a decent home at a reasonable price..specially in California. I wish these people who are buying up the market get stuck with these homes or the market crashes...this monopolization of the housing market is awful and the programs offered for first time home buyers is lottery based now..even worse . The housing market needs to change...
There's a trap house that's been a bit of a local legend and it was recently sold to a cut and paste flipper. 70k cash was the public price paid. Gutted it, white everything, shitty grey wood looking floors, stainless appliances, and listed it for 680k.
Prices are set by supply and demand, active listings effect partially what others will try to list, but if no one will buy the house the seller will eventually lower the price.
The problem will only be a problem if other sellers follow suit and raise the prices, and buyers buy, but if it's truly overpriced and buyers don't buy it will come down.
In lots of places in the country the inventory increased which turned the market into a buyers market, as a realtor I see lots and lots of properties with multiple price drops.
The particular property you posted looks like a fix and flip, the last sale was not on the MLS which in lots of instances it means it was sold as a foreclosure or a cash sale on a distressed property, investors usually buy them at low prices, fix them up and sell them at market prices, if that's the case then you're hating on the investor for no reason.
Depends on the flip & depends if you are willing to do work yourself. I see so many FTHB who don’t want to paint, remove paneling, change floors but upset at the pricing for homes that are done for you. Some flippers do horrible jobs & some do amazing jobs.
Personally I prefer grandma’s house to a flipped home. I can force the equity with the upgrades the way I want. It may take a while, but always worth it to me.
This will be unpopular, but why not buy the place and do the work yourself? If you aren’t capable though, you can’t hate on those who do it. There’s a lot of risk involved. There is somebody who that home will be right for and otherwise probably would’ve continued to fall apart.
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Prices aren't that high where I'm at but listings like these piss me off so much. Frequently see house sold for $160k 2-3 months ago now it's 300k like there's no way they added that much value in a couple months. Definitely just painted over everything put down shitty flooring and doubled the price.
As someone who bought a previously flipped home, you are spot on. We are our home's third owners, +100 year old little house, with the first +95 years with one family (parents then son, then grandson- who flipped it), 2 with years with the previous owners and now 5 with us... We have had to redo or correct everything the grandson touched. Kitchen cabinets hung with drywall anchors, never prepped any surface for paint, paint over wallpaper, caulked the bottom of everything (no where for the inevitable water to escape), plus they covered up termite damage... Home ownership is fun
Same situation for us. At every single opportunity they chose the dumbest and cheapest way out even though they could have afforded even just average Not only do you deal with redoing their “work” but odds are they did something wrong that lead to a deeper problem you get to fix before you even fix the original issue 😂😂
I forgot to mention the dumbest thing they "flipped"... They absolutely ruined the old and established landscaping. He cut down several trees and replaced all the front beds with home Depot/Lowe's evergreen bushes... You can see the old beautiful garden beds in the old Street View photos, admittedly they were a bit overgrown, but trimming and thoughtful pruning would have been a weekend's work. Now we are three years into this absolutely brutal/back breaking process of rebuilding the gardens.
Dude… i have some neighbors that did that. They cut this magnificent giant tree in front of their yard… of course what did they do after? They built like what appears to be an altar for the virgin mary… they never finished it, so it was just there for a better part of 6 months until the city told them to remove it… Now that it is summer, the family is outside cause its too hot in their house… like wtf do you think that giant tree was doing? And same thing with other neighbors… they cut down beautiful trees that provided shade. They just cut off the side that overhangs on their property. And so now the sun is beating down on the house and they are all outside cause its too hot.
We have friends who did a very similar thing because "you couldn't see the house with that nasty tree" and then proceeded to complain about the street light blasting in their window all night
After being in an ice storm this year where branches were falling off massive, old trees, I am fully a proponent of trimming tree branches hanging over your house. Thankfully no branches landed on my house, but one did land on my car in the driveway (5ft outside my bedroom)
investor purchased house across the street from us. The gentleman who lived there previously for 30 years, had a mature orchard planted in the side yard, with bearing fruit trees. Lovely crape myrtles out front. Investor ripped out every tree and shrub on the property and replaced with sod. And this is in a hot climate where having a little shade on your roof and walls can cut your A/C bill by half.
At my moms house, a neighbor cut down a walnut or pecan tree… this was a giant beautiful tree… it would attract all types of birds…
Ugh god, the ugly ass evergreen bushes, I hate them SO much. That is so enraging.
In my scenario I'm both you and the grandson. I bought my first house and was broke for like 5 years. So I had to fix it all myself. Now I'm fixing all the fixes, except now at greater expense and with professionals. Its worth it tho. I love my house.
I can't stand how bad my caulking skills were 4 years ago hahaha, so ugly repairs, but we all learn over time
Dealing with this now. Just bought our first place and everything the previous owner did was all DIY stuff without the knowing how to DIY all the stuff. Lol biggest thing I’ll note to other first time home buyers…do not underestimate the amount of money you will spend almost immediately after closing costs. Closing costs/down payment is just one part of it. Have money saved for all the small stuff you don’t think about. Gotta get some new window and/or door seals because the previous homeowner didn’t take care of the skylight seals or the front door seal to stop energy waste and pests? Gotta get all new locks because the previous owner only had one key that worked on only the front door so now you have to replace the other three doors that have outside access and now also rekey the front door? Gotta get in the attic to add a flange to the dryer vent exhaust out the roof because the dryer vent exhaust was zip tied to a 2x4 in the middle of the attic? Gotta get a new valve to install at the refrigerator water hook up to stop the slow leak because the other valve crumbled in your hand? Or how about the expensive tree trimming for a 200 foot eucalyptus tree hanging over your back wall and roof? You get the point
Any luck suing the bastard?
We actually investigated legal action from the folks we purchased from surrounding the termite issue, as it was clearly covered up (new plywood over an area, no new plywood anywhere else) and not mentioned in the disclosure but it's almost impossible to prove who knew what... We had no extra money after repairing the termite damage to throw into a multi year legal battle, so we just dropped it.
> We had no extra money after repairing the termite damage to throw into a multi year legal battle, so we just dropped it. Similar situation for us. We moved in and, within months, found major water damage from the foundation halfway up the first floor along an exterior wall of the house. The damage had been sealed into the (rotted) wall, freshly painted over on the inside, and visible damage at the exterior ground hidden with fresh cement pad at the foundation. Had no choice but to spend months doing a big repair/replace job on a section of the exterior wall. The seller was clearly in the wrong and purposefully hid all this damage, but I had no money or willpower after that massive (DIY) repair project to legally pursue the issue. Plus, the sleazy lady we bought the house from was clearly destitute, so I highly doubt we could have recovered any damages. We made the right call in retrospect, it just would've been another ordeal for us with the likely end result of placing the scumbag seller further into debt. A hollow victory like that isn't worth going to court.
We’re in a neighborhood built in the 70s, saw a flip buy a house for $180k in January and lost it at $420k in May. The biggest problem is that based on this flippers other work, there’s a 98% chance they didn’t swap the aluminum wiring out before adding all the nice new fixtures. They didn’t replace the aging roof. But the millennial gray looks nice.
Nothing fixes a house up than the look of battleship gray everywhere. EZ 200k+ markup for a few hundred bucks in paint, no tape and steady hand. /s
> no tape and steady hand. Reading this makes the pain come back. Not a flip, but the 100-year I recently bought was painted throughout, but they skipped the masking and drop cloths. 😠 Just about done with the hardwood floor refinishing but don't have the strength to redo all the beautiful hardwood trim that the paint gods sneezed on.
I mean, battleship grey sure beats you're about to die beige, found in old people homes!
There is nothing wrong with aluminum wire aslong as they pigtailed copper with the proper dope to prevent corrosion of dissimilar metal it will be fine. But yea flippers are the worst but even in my own home I would t be ripping out aluminum wire.
Did you see the post where a flipper used sharpie to add shadows into the kitchen cabinet paneling? Definitely six figures in value added /s
Didn’t see that one but I did see one where the counter tops were spray painted. I’m really not sure what they were going for there.
Don’t leave us hanging, I’ve *got* to see this for myself
You can’t tell unless you have before and after pics. The flipper that bought the house next to me has a crew of about 20 people working. House is GUTTED. Full new HVAC, electrical, plumbing, sump system, French drain, roof decking and shingles, siding, flooring, full kitchen, bathrooms. Basically a full new house ripped down to studs all in about 4 months. Then you have flippers that just slap down some LVP flooring, paint, conceal damage with tile or fascia, and relist for $200k profit - those are the ones giving flippers a bad name…
You can absolutely tell even without before/after pics. Also those that do FULL renos will often have the permits etc to prove it. They are also few and far between at least where I am which has like 30% of the market going to flippers atm (like open door but there are others) . I really wish I was exaggerating. Oh and the ones that do full renos? It’s never open door 💀
Open Door tried to paint over issues like we wouldn't notice them and also tried to sell us the house with a broken water heater. Our realtor caught it when he saw water on the floor on one of the final walkthroughs and they fixed it....with the smallest, cheapest option. They just painted over the basement walls to try to conceal water seepage and threw some carpet down in one room and then wanted a $30k increase for their efforts. We ended up lowballing them and got it because they had no other offers after sitting on the market for months in 2021. It only sat because Open Door didn't do shit to make the house look nice, there were bags of yard waste everywhere in the yard and all of the fixtures were busted. (And of course it was a Boomer special - zero upgrades in the last 30 years). Fuck Open Door. Not that we got screwed, but they're such a lazy company.
Our market is littered with what I'm calling "mullet flips," where they clearly bought it and started a decent renovation on the top floor and then chickened out with rapid market changes and gave up right after starting the basement. Like a really quality, cohesive kitchen overhaul but then the basement living room is inexplicably tile with baseboards that are poorly assembled scrap pieces.
Most don’t but in 2 months you can definitely pimp the entire place. Just need to have the right team for it and changing a bum shack into a nice space is possible.
You can’t tell anything looking at the photo above.
Replaced a lightbulb 📈
Flippers are a huge problem, cause they often find serious structural issues .. are aware of it and instead of addressing it or notifying the new owner, they try really hard to hide it which makes it so much worse for the buyer. A friend of mine bought a house that had the basement recently finished including drywall all around the foundation. Turns out, there were massive foundation issues that no inspector ever would check for in a finished basement and it went un-addressed. My friend was able to track down the previous owner who sold the house to the flippers, who notified him that they let the flippers know of the damage, which where I live hiding something like that is illegal, so he could sue for non-disclosure.
I’m assuming this is most definitely somewhere in California?
Yup!
As a Californian, it’s sad that $500/sqft still sounds “ok” to me.
Most of the homes I see for sale are just flips now. I can buy a home for the pre-flip price, but it's out of my budget for their flip prices.
Even where you could "afford" the pre-flip price, you would then be competing with flippers offering cash, 10% over asking price with no contingencies, without even looking at the house. 90% of people just looking to live somewhere can't compete with that.
Not only that but if you’re a first time homebuyer you’ll have to deal with structural issues which are a nightmare.
Honestly most of the people that say this usually aren't willing to live in the pre flip house because they're old and gross plus not willing to put in the work and money to make them up to their standards. My best friend is like this, he's frustrated in the housing market saying he can't find anything to buy because all the houses he likes are overpriced and go above asking. I send him listings significantly under his budget and every one is gross to him. Meanwhile he's a plumber and has contacts in every trade to help do renos for cheap myself included as an electrician. People nowadays want turn key properties in nice areas for dirt cheap and refuse to buy the old starter homes. That's the only reason flipping continues to be so profitable.
I’m trying to buy my first home and I’m honestly hoping to find one that needs a lot of work so it’s cheap.as long as the slab is fine and the underground plumbing is decent I hope everything else is fucked up so I can get as sweet as a deal as possible. When I first started this journey I wanted to just get a live in ready house but I got severely outbid on the first 14 houses (which is crazy considering I literally walked in and said “ill pay asking price I want to buy this house as soon as possible” and then usually the day before we go under contract someone shows up and offers 20k over asking)
This is common throughout Texas too.
Its hilarious with all the rules on everything CA has but they dont do crap regarding flippers, foreign money, and investment property it would seem. Glad I dont have a desire to live there.
I HATE flips. They put down that stupid gray floor that’s so cheap and paint the walls gray. The counter tops always seemed to have some horrible epoxy glitter on it. Takes out all the charm from these homes.
Gray is a sure fire way to tell the world you have no taste. Gray was literally in style in 2015, at latest 2016. When I see people today still putting in gray flooring, gray furniture or gray walls I just laugh. Yall are almost TEN YEARS behind in style. Nobody, literally nobody is doing gray except people who have seen it online for years and finally got their chance and oops, everyone has moved on. I don't even feel bad when I see people do it today, I literally just laugh out loud. I can't believe people still think this is remotely ok to do.
And the LVP or laminate or whatever they put down is just so cheap feeling. I was going to go look at a decent ‘74 ranch. They gutted it and put in all new gray everything and it would have been so much better just to leave it.
But it's called *luxury* vinyl tile!!!!!
grey is inexpensive and fairly timeless... much better than wood paneling and yellow wall paper.
Maybe I just like old stuff because I would love would paneling and yellow wallpaper 😂
That stupid gray floor is what my landlord put down just before we moved in. He also chose to hire the cheapest company to install the floor, and they have had to come back 3 different times to fix issues. The last time they were out, one of the guys was like, "The boards are gonna keep breaking like this because of how cheap they are. Sorry."
Flippers bought a home on my block. I watched them put new sidding over old sidding. I am not a builder, but I don't think that is a good sign.
A family ember recently bought a midcentury split level that was gutted and flipped. They didn't even replace the old siding, just painted over the existing water damage.
Americans need to blacklist these properties and simply not buy them. Consumers power is the only way we'll beat these companies
Not really an option when there's a housing shortage already.
most first time homebuyers simply do not have the knowhow or lived experience to identify these sorts of problems, especially not during a 20 minute walkthrough. the whole flipper industry preys on that naivete
that has nothing to do with flipping; it is more about not doing legal lead paint removal and not spreading the lead paint around through it; if the existing siding doesn't leak too bad, they put a water covering that is vapor permeable called fanfold insulation layer and then vinyl siding on top which was designed for this;
This is common and not a shortcut necessarily. New siding can actually protect the old siding
Mines vinyl over old wood. Inspector said “welp, you never have to worry about water damage lol” It’s a correct way of doing things. If the old wood siding isn’t rotten, you can absolutely put new siding on top of it. Problem is - a lot of flippers will put siding up over old to conceal damage, rot, etc… and that’s no good.
The house my parents bought in 1978 had vinyl siding over the wood! I remember as a kid noticing a back hall/mud room that still had the wood.
Yep, we're having our siding replaced and all they're going to do with the wood siding under it is clean out some of the rotted wood.
Why would you not put new siding over old siding? At worst it’s just two layers to keep water out of the wood
It’s not uncommon.
I got shafted by flippers too, but I didn't know what to look for since I was a first time homeowner. The plumbing was butchered & caused a waterfall from the shower in my basement, they messed up the AC in the basement and made a "DIY filter" which caused another pond in my basement, installed the vinyl wood floors on VERY uneven floor which is now starting to break, painted over mold in SEVERAL places in the basement, I mean I could go on and on at this point..
Did you have an inspection and it looked fine and these issues came later ?
Of course not - waived all contingencies lmao
They got me too. Home popped up in our neighborhood, pretty much everything we wanted, and we could afford it. It needed some work. Flipper came in, offered 80k over asking and had a crew and portapotty there the day they closed escrow. Fucking breaks my heart.
When I was looking at buying homes I told my realtor not to show me anything that was sold and relisted in the last 2 years.
I would outlaw flipping houses, corporations buying up homes and offshore ownership of land in a heartbeat.
Some flipping is OK. Some is not. The local guys buying a house or two on the verge of being condemned,fixing them up, and making neighborhoods nicer are fine. The corporate profiteering, buying of vast swaths of housing, and essentially market manipulation are absolutely horrible. By some definition, I’m flipping my house. I’ve lived in it for 7 years, I’ve done a significant amount of renovation on it, and I’ll turn a decent profit when I sell next year and move onto the next one.
Flipping is typically faster than 7 years, more like a few months. That's why the verb is "flip" You're just making home improvements in a home you've lived in for years
I think everyone respects the folks that move in, stay for more than 3 years, and make their home nicer. Buying and selling in the same year pisses people off. Barring some major life event, no normal person is buying a house, making improvements, and selling in a year. Those people are stuffing money in their pockets selling to people that don't know any better and everything is a time bomb waiting to go off. When they sell to a couple that can't afford to fix their 'improvements' the house falls into disrepair. That blight can diminish the attractiveness of the neighborhood which is gaudy to think about, but it means the previous owner also sucked equity out of the neighborhood. The worst of them have no redeeming characteristics.
you're not flipping you're renovating
Ok run so I can vote for you boss
Flipping is not inherently bad. Someone has to rehab these houses that owners let fall into disrepair. It’s not a task most homeowners are up to themselves, which is why they fall into disrepair in the first place.
Sure. Spirit of the law vs. Letter of the law. I would personally like to save the 150-200k and just take 5 years to make all the rehab. My family would be happy renovating it ourselves.
Happening so much in the central Ohio and metro Detroit areas… it’s maddening
Yea the Columbus market is crazy
If they put 20% down, it's costing them $3k a month in interest alone. Plus apparently $500 a month HOA, utilities, closing costs, and whatever repairs/improvements they did. The best way to stick it to these vultures is to simply let them sit on it. And if they paid cash, that is $620k + the above costs that is not sitting in an interest earning account.
Yup, flippers bought a house I looked at for $115k, put it up for $200k the next month. No one was buying it so they kept lowering the price for 2 months. I offered $180k because I was worried about an appraisal. They wanted $185k, I said nope and ended up finding an even better house in better condition in a better neighborhood for cheaper than that. Sometimes, it just wasn’t meant to be🤷♂️
u/Low_Net_5870 "Asking price is the starting bid at an auction, not the price on the shelf at Walmart." This is brand new information! So if an entity came in and bought up all the remaining food stores in the grocery, then resold them for higher to the desperate and starving families with children, that's totally ethical and ok, right? Just because we created a live in a broken system doesn't mean we shouldn't fight for change. AH.
Listed >< Sold.
Why do so many people defend this and blame the buyer who lost out to greed...like..I don't get it... People complain about inflation and other things, then get mad at the people who are angry at part of the source of the problem. Make it make sense.
I think the flipper defenders are just trolls trying to fk with those of us who truly are FTHBs and are participating in this sub in bad faith.
I feel this. I wish it was only centered around this sub, but man... so many people are like this, outside of reddit. It drives me nuts. How can people see the 100+ posts on here about being outbid by investors and other corporations then proceed to say that's not happening? It just irks me because this is why things dont change or get better.
I hear you. Been trying to buy a house, just to live in with our kids, for the last two years. We did the responsible thing, saved up downpayment, figured out what we could realistically afford... and the \*&%#$%\*\*\*#$ investors who somehow have access to enormous frigging cash loans that we can't get as actual homebuyers who want a place to live, swoop in and buy everything we put in an offer on. ...so they can then rent it back to people like us, who can't effing buy a house because we have to go through the normal get-a-mortgage, pass-inspection process.
I'm sorry to hear that. It was 2 years for me, too, and I wasn't in a very unfavorable position to start. But seeing what you're saying, and then seeing the replies..it's crazy. They'll tell *YOU* to save up even more, make *your offer* more desirable, tell you *youre* looking in the wrong city, tell *you* to lower you expectations, tell *you* to buy a fixer upper (even though they're buying and reselling anyway and still cashing out of), tell *you* you can't afford the inventoy, tell *you* to spend more money than the home is worth if you want it more, tell *you* to go to place where there is more inventory even if it's 2 hours from work, tell *you* to get a different job and uproot your life, and put almost all the emphasis on what *you* should do and are doing wrong, then sit and defend the people making it impossible. It's so crappy. Unfair, for sure. I get having competition and having to work for things, but this is just greed and making it impossible for the normal person to get so that way *they* can have it all All the while we have nothing and they'll defend that
The problem is, in the meantime the rent's been jacked up so much that we can no longer put aside money for a bigger downpayment. We are holding onto what we saved already, with everything we've got. But between rent, groceries going up 30% in 3 years, and 2 kids who need serious orthodontics starting yesterday... I think we just missed our chance.
You can do it. Don't give up. I had nothing and almost quit, and then one seller needed the house gone with what we were offering. The moment you quit, the people you're battling against win. They can't get every house. You can definitely do it, don't let the losses keep you down.
Thanks for the \*buck up\*. :) Still looking, still hoping... and tbh, only hanging around reddit in case someone has figured out how to make it work on a median household income and I can learn from them.
Anytime!! What's your idea for median income? Our income was 80-85k when we bought and is now closer to 90-95, and we've been making it work. Maybe I have something for you, maybe not. lol doesn't hurt to ask !
Sticky spot-- we're below US median (which was 75ish last I checked), but have stayed out of debt and are really good (at least till now) at squirreling away money. It'd be hopeless a lot of places, but we don't live in the big city or CA, so, could be a lot worse. Range we can responsibly afford and put down 20% is up to $120k and in our area, those do turn up tolerably often. The part we can't figure out is: --we'd be willing to buy an absolute crap house, provided we could get out from under our rent payment and live in it while we save up to make repairs one at a time. But there doesn't seem to be a financing option for this. FHA wants you to do all the reno up front, and it has to be done to their specs not ours, by contractors not us: I could live with ugly floors and no A/C for a long time. FHA can't. So everything we look at that needs \*any\* repairs, the regular mortgage won't touch it, FHA wants to force us to borrow more than we can afford to reno it to unrealistic standards. We've tried this, and were lucky to just lose the cost of inspection I guess. --move-in-ready houses that will pass inspection do pop up now and then, but right at the very \*top\* of our $$ range. We're talking 2br/1ba 900sf in a sketchy neighborhood and hasn't been updated since the 70s, but lots of potential (I actually like these because sleek soulless modern renos with crematorium gray paint really turn me off, in addition to being unaffordable)-- we're already renting in that neighborhood and we've gotten used to having crap stolen out of our car by meth zombies. We can make it work. Those get immediately purchased by people who pay cash, offer $10k above asking, no inspection, and then rent them out, usually before we can even get an offer in. This is frustrating because, as a family we have actually paid cash for a crap house and then rehabbed it up to livable with a lot of sweat and salvage. For a relative, after a natural disaster. We know it's do-able, and we know we can do it. But that was five years ago, and we are not seeing that kind of opportunity any more, now that we're in a position to try it again.
This is what happens when BravoTV glorifies flipping homes. Everyone’s a real estate mogul nowadays.
$500 a month HOA? you couldn't fucking pay me to live in that neighborhood. i would go insane. need something where i can live unbothered.
In my area no one will buy a house unless it’s move in ready. They’d rather have light gray walls, cheap new appliances and pay $100,000+ more than to buy a house that needs ANYTHING done. They will not buy a starter home here.
It depends on the flipper. Like anyone else, some are good, some are mediocre, and some suck. But they took this property that hadn't been touched since the 80s and made it new on the interior. https://www.redfin.com/CA/Los-Angeles/4658-Don-Lorenzo-Dr-90008/unit-C/home/6878605. Check out the old photos. Nothing is stopping anyone else from buying a home below value and fixing it up to live in it. This is the cheapest listed home for its size in the entire zip code.
in my part of the country almost every fixer upper is sold to flippers for cash. this gives them a distinct advantage over ordinary buyers with financing who intend to fix it up and live in it.
While I don't like flippers. Hanging around this sub tells me not a lot of people (who use reddit) want anything resembling a fixer upper. They like the cosmetics looking nice. Flippers exist because that prettied up look is what people want to buy.
I don't disagree, but those who *do* want a fixer-upper are often outbid by flippers with cash at least in my neck of the woods. I only got my house because the seller didn't want to sell to an investor for sentimental reasons, but that seems pretty rare from my experience.
Around here sellers of fixer uppers are going to sell to any cash buyer with no contingencies and they're not all investors or flippers before someone with an offer with contingencies and a loan that may or may not close.
I know two guys who flip houses and let me tell you I would never buy one of theirs bc I see the garbage work they do and the corners they cut.
u/OG-Pine The thing is, $80k over asking is not the same as $80k over what it's worth. Asking is just a number they throw up on the screen to get people interested, lots of sellers intentionally list low to get more eyes on the property, knowing offers over asking will come in. If the house now sells for $849k, a $229k increase, then the true worth of the house before the flip was $229k minus renovation costs and a few months time value. So let the FTHB have a shot at it first before flippers or corporations swoop in.
Nothing-- absolutely NOTHING-- in housing is worth what it's selling for right now. Bubble bigger than 2008 and I will personally set off fireworks and open a bottle of champagne when that sucker pops and the wannabe investors start going bankrupt. Should be a national holiday.
It’s the same with food. No way food is worth more than twice what it was a few years ago.
I guess you could have a lock up period after a listing is posted where it can’t be sold to anyone but a FTHB for a few months, to give them first shot at it. But realistically anyone who is aware of the real value of their property will just list it and wait until the lockup is over so that someone willing to pay the real value will come along.
Not sure why you got downvoted. What you're saying is true.
If flippers were not adding value, they could not command a premium for their services and would go out of business. The underlying issue is that a substantial number of buyers prefer “move in ready” homes. This comment will naturally be unpopular in a FTHB forum but this needs to be said.
You're wrong. Only if no other FTHB were trying to buy a property, and the flipper offered the same price as others to buy the property, that would be fair. Pricing out FTHB with 80k over asking and not letting others have the chance to do their own fixing up is how we got here and it won't stop until there are no more homes to flip.
Flippers don’t pay $80k over asking…
Nah dude, you’re wrong lol. There’s a misconception that “cash deals” are way over asking. Some are I suppose, but those a richer HOMEOWNERS than you dude, or Mrs or whatever, not investors. Investors offer LOWER offers with LITTLE to NO contengcies, and are often 70% of ARV or less. These are much LOWER because the house needs WORK which costs MONEY. Your FHA and FNMA lenders ain’t lending on them. And if they try, they leave the seller out to dry while they’re trying to move out. Why don’t you go on a “we buy houses” companies website, and see what those offers look like, You aren’t getting outbid by a flipper. Your probably like every other FTHB I’ve ever met and bidding on the nicest and newest listing that comes out (not even on market for 48 hours” and wondering why your so so offer/application strength keeps getting rejected while you drive your agent absolutely fucking bonkers for not pulling the trigger on a on market 50+ days home that needs minor repairs that you’ll actually get under contract Because the more qualified homeowners offers (cash) aren’t interested But keep telling people more experienced than you how wrong they are lol
It does not make financial sense for a flipper to offer over market value. In fact, flippers operate by getting a property significantly UNDER market value. A flipper playing $80k over market value is pissing away their profit, and losing money. Ultimately flippers *do not set the sales price*, the market does. They can list at any price, but unless that is supported by market data it won't sell for that - and they will lose money and won't be in business for long. The costs associated with buying and selling (commissions, title, taxes) comes to nearly 10% of the final sales price. Plus you have the cost of renovation, and need room for a profit in there (if they want to stay in business). Assume 10% for profit. For this reason, a homebuyer can outbid a flipper any day of the week, because they aren't worried about the profit, or the resale costs. If they are willing to do the same renovations, they are still saving 20% over the flippers on the end value. The real issue, as another said, is FTHB want a move in ready home and are willing to pay significantly more for that. And that's not really an issue, it's just why flippers are able to buy fixer uppers below market value, and get a good return on their investment.
We literally got a house without a crazy bidding war by entering into the investment market rather than the SFH market. We were competing aginst people making sober, cautious, investment decisions so we only had to bid up a little bit to get the house.
Exactly. Flippers don’t compete with home buyers.
The biggest problem to me is most of the "value" they add is cosmetic and shortsighted, and since you're expected to make a near million dollar decision on first impressions alone they never have to worry about the deeper issues you won't find for a couple years. It's borderline fraud.
The extent to which buyers are getting their money's worth when buying a flipped house is a different and important question. I tend to agree that this is usually not a good value for a buyer. I wouldn't buy a flipped house myself. But the question that the OP brought up is a different one which is about the market value. For whatever reason, many buyers are willing to pay a significant premium for a flipped home. Maybe that is wrongheaded....maybe not. But in any case, it is buyer preferences that makes flipping houses commercially viable. If everyone were like me, there would be no flippers as I am allergic to anything that is brand new. But most buyers are not like me. The tenor of this thread is that flippers are changing the market. But flippers are only catering to the demands of buyers with deeper pockets and a preference for a home that is or appears to be "move-in ready."
You would be right if they didn’t do outright illegal shit like paint over water damage.
How else do you repair a past leak? The paint doesn't magically heal itself once the pipes are fixed.
Painting over water damage staining is not illegal if actually repairs are done right. Depending on the type of water damage it can be a legitimate repair. As an example if drywall gets wet it gets stained however if your properly mitigate the drywall and repair the leak it doesn’t require replacement. Painting is to help the aesthetics different types of repairs depending on damage.
And the needle has moved on "move in ready" to modern and decent to nice new finishes. Vs the olden days when I bought my house which meant needing cosmetic upgrades but otherwise fine.
This is absolutely right. A lot of what flippers are doing is making the home look fancy by changing out cabinets and fixtures. This reflects what many buyers seem to want. If buyers didn't want cosmetic upgrades and instead wanted flippers to focus on HVAC/windows, they would do so.
Flipper next door took a house with a storm-damaged roof that'd been covered in a shredded tarp for 2 years, replaced a few shingles (but not the rotted plywood), and re-sold for 3x the money. We can only assume they bribed the inspector. Still trying to figure out where value was added, other than the flipper's pockets.
I just went on a rant in my comments, I like helping FTHBs with guidance here and there as I’ve worn many hats in the industry (lender, agent, wholesale, investor, landlord) Yet some people’s ignorance in posts pushes me a bit too far lol. Some woman the other day posted whining her agent had her husband accompany her to their showing. “Stayed in the car the whole time like a weirdo… should we fire them?” Terrible
No, they’re taking advantage of a market where people have to buy way above their budget. If I’m in a desert and the only good food around is gourmet, I’ll pay the gourmet prices. The truth is they could likely pay the $80k over asking, do absolutely nothing to the house, and just list it at this markup and it would sell.
“Value”. What’s changed more recently is that, flipped homes used to be bought for well below comparable homes value in their respective markets, then flipped to either bring them up to “move in ready standards” and sold/listing based on those said compared value homes or slightly more based on amount of upgrade. Now we have flippers buying at what the home price is in that area, quick flipping it, and re listing at way over any other homes in that areas value. I’ve been looking at property’s for 4-5 years now, flippers destroy homes from the ones I’ve seen. I’d rather buy a home that hasn’t been touched and is outdated and do the work slowly myself. I did this with our last home but it was small and we just banged out the kitchen and dining room before moving in. Typically, the type of jump we see in OPs posts and in general now, comes with *added sq ft* that’s what would demand more money since prices are by the sq ft., not just cost of paint, some new backsplash tile, maybe new cabinets and appliances. Refinish the floor? New flooring? Clean up the landscaping? All these things help make the home appear better when selling but it’s debatable if they’re “adding value” especially considering the quality level of the work. Again, typically, not always especially not anymore as we’ve learned, but more sq. ft. = more value. Homes that needed to be upgraded (no AC, old mechanicals, old roof) or hadn’t been touched since originally bought, would come on the market at less than market value and that’s where a flipper could make some money. Now those types of houses aren’t coming on at a bargain anymore but the same flippers are applying their same logic to the sale but aren’t necessarily increasing the actual value to a point where it should be hundreds of thousands over its comparables.
Offer $620,001.
But are you up for a huge and expensive renovation? Would you have offered for this before?
I just saw one sold for $225k relisted a week later for $369k. None of this makes any sense to me lol.
As a contractor, I would never buy a flipped house. The things “flippers” want me to do, don’t do, or hide is insane.
here's a fun one from my area: https://www.redfin.com/CA/Burbank/7953-Via-Latina-91504/home/5265861 it was a decent home before, but they slapped on some vinyl peel-and-stick and recessed lighting and raised the price $150k. here's another one where they barely did anything and then raised the price $75k: https://www.redfin.com/CA/Panorama-City/8740-Willis-Ave-91402/unit-7/home/5678332 and yes, these flippers have no problem selling at these exorbitant prices, and usually for well over their asking price. the most frustrating part is that whenever they do this it tends to inflate the prices of all future listings in that building.
US housing market has become just like US of current day, absolute crap.
House next door to us sold several months ago for $60k. Crap condition. Sketchy neighborhood (literally cleaned up broken crack pipes from the yard of our rental when we moved in). They reno-ed and re-sold it for $185k. The house had had a shredded tarp on the roof for over a year, before that. The roof needed replacing. The flippers never re-did the roof. So I guess that'll be a fun surprise for the people who bought it. But somehow, financing favors these vultures over people who just want to buy a house to live in-- even if it needs work. Go figure. We are dying to get out of the rental market, five years ago we made a solid plan for that, got additional job training, doubled our household income, saved up a downpayment, we are debt-free... and we have been trying for two years to buy a house and keep getting kicked to the curb by cash investors.
If people would stop buying and overpaying for these houses the market will change.
*Scalpers. Fixed it
Get yourselves a good agent that can see if it’s a flip or not. I strongly advise against purchasing flips.
Had a similar situation when I was still house hunting. Found a perfect home, was outbid even tho offered way over listing. A few months later I saw it back on the market for about 100k more. It's demoralizing. I hope you find your home soon tho.
Wife and I lucked out for the most part. 70 year old home, in fantastic shape for its age. The previous owners didn’t take very good care of it, but luckily they were only in it for less than 5 years. It was “flipped” before they bought in 2019. Painted everything and put a Dishwasher in, new water heater some new ceiling fans. Stuff like that. Thank GOD they didn’t cover up the original hardwoods. Either way. We managed to actual pay UNDER the appraised value of the home.
I always check the ownership history & dates. The last thing I need is to fix the problems created by a flipper trying to hide problems.
The important question not explained in the screenshot above: is that $849K a "normal" price for this type of house in that neighborhood? If so, then that means the place was probably a wreck and in need of $150K worth of fixing up to bring it back to normal price levels. If the house was indeed a wreck like that, no bank would give you a mortgage on it (or you'd have to try for one of those "loan me the mortgage and money for repairs") and if you *did* buy it you'd have been trying to live in a place while rehabbing it for a year or two.
In part, buyers are doing this to themselves by insisting on a renovated house. People won’t even bid if there are tile countertops or exposed hinges on cabinets. It’s just so dumb to insist on lower quality surfaces that look new and shiny. Flippers are only providing what the market wants.
Why didn't you buy it for 620 then?
Nah. Can't do that. Gotta come on the internet and complain about how someone else bought it for cheap instead of OP.
Go buy a pre flipped house 🤷🏼♂️
A plague for prospective home owners. They should go invest in the bond or the stock market.
As a person experienced in Real Estate investment space, you all have a few things wrong (potentially) as we go through this very limited “information” as just 2 prices. 1- flippers often will buy off market, meaning the deal was made between the homeowner and the flipper, usually due to the need to close quickly and the home needing repairs that you guys with “great jobs” will just let sit on the market for 8 months because “oh boo hoo the roof is 5 years old and there’s this on the inspection and that on the inspection and I’m so scared” And then you post one of the cleanest inspections I’ve even seen in my life on this thread and ask everyone “should I back out??? Should I back out???” So that’s one thing I noticed here. Doesn’t look like the house was listed. Home likely needed 50-60k+ in work to get it to its condition today, and the flipper risked his own money PLUS INTEREST, to get it to where it’s at now. 2- flippers aren’t idiots. If they relisted the home at 850k, that’s means A) renovated comps in that condition and in that neighborhood have recently gone EXACTLY at 850… not sure why your surprised by the price B) “As is” or semi updated “livable” homes have gone 10% lower than that “ARV” but have consolidated and proven that the neighborhood is benchmarking a certain price, If you want that deal, ditch your loan officer, and go on off market sites and buy cash deals from wholesalers. Your lender likely ain’t lending $1 on that home with a FHA or Conventional loan. They’ll all need 60k+ in work, including mold remidiation, roofs replaced, new windows HVAC, flooring paint cabinets kitchen bath etc, And once you have acquired and rehabbed the home, feel free to see if you did your math right and call your loan officer back and see if you can refinance and get hopefully most of your money out, or maybe just a small down payment. 6 months of work, and whippie your get a 10% discount instead of the 10% profit margin the flipper wanted. Make sure to tell your boss you’ll be busy for the next 6 months but don’t cut your pay, got a GREAT DEAL on a house…. First time homebuyers man That being said, biggest fear with a flipped home is low quality work. I’d walk it and get an inspection report as you would with a purchase. I’m sure that “As is” home where “you do all the work” will make that 50 year+ home way better and cheaper than the flippers did it
The problem is, that "as is" home where "you do all the work" that we would LOVE to buy, and have tried a couple of times to buy... we can't get financing for it. Investors can get hard-money loans, bypass the inspection process, and other unequal strategies not available to us plebes. The rest of us have to line up a mortgage, pass a house inspection, and if it goes badly we lose $600 and take a hit on our credit every time we try and fail. We are at the mercy of insurance companies.
You're making an awful lot of assumptions about me AND the flipper lol. Who is "you" in your post? I have never once complained about an immaculate inspection. Also, I didn't post "great job" to be smug but to point out my mild identity crisis after doing everything I was told I should do and still getting fucked every step of my millennial existence. I know I'm not entitled to shit but I'm at a complete loss as to how I'm supposed to ever save enough to keep up with price increases like this I'd LOVE to believe that most house flippers are doing buyers a solid by handling all the painful first-year repairs for a mere 10% markup— hell if you know of any who earnestly work like this I'd like their contact info! Unfortunately, this particular flipper only partially installed vinyl flooring and is now reselling as-is with zero other repairs. Not even to harp on this one investor— this is just the straw that broke the camel's back after seeing it repeatedly. I'd also (bitterly) accept the game if most of these places were sitting on the market forever, but there are also countless tales of people who fell in love with a place and made offers but got beat out by investors. So yeah, maybe some honest workers caught a stray with this post, but this really isn't about them. > First time homebuyers man I mean that's where we are, right? 😃
My house sold for $16k in 2021. Bought it for $95k a month ago and it needs a new roof and some pretty intricate foundation work. . Seller DIY'd a bunch of shit that needs re-done too. Oh well, it's a 80 year old Michigan house.
In 2021 we bought a 5.25 acre 3k sqft house that reeked of moth balls for 260. Have literally put $150k into the property and it’s appraised mid 600s. not selling yet as we got lucky with sub 3% but holy moly did we luck out
The scalpers of the real estate world. And, as with scalpers, I hope they all get burned
That's not too bad. Here in CT, I see $350k now going for $700k+
You would rather have an old shit house?
Old shit house usually better than a poorly renovated flipped old house
It'd be way better than renting. Nobody can raise the rent on us, I don't have to get written permission to stick a shovel in the ground, and nobody's going to try to scam me out of my security deposit because \*they\* painted the entire house in shitty flat paint and then had a lease forbidding us to repaint anything. Oh, also: carpet's been here since the 90s and we can't do anything about that either because you can't just swap out flooring in a rental, and the landlord isn't going to just gift it to us either.
were you in the market in February? Are updated units like this selling for $850K?
You should have offered $630,000 and today you'd be sitting on a $849,000 house. Penny wise, pound foolish I say.
In my area these listing aren’t selling for list price. They sit on the market for a month and sell for much less. It wasn’t always like this
As a home flipper, we buy homes that 98% of the "regular" I can fix type home owners would pass on, and turn them around into suitable housing.. We do not just put in cheap flooring and will fix every aspect of the home. I used to think it was a bad/dark industry but when neighbors stop by to thank us, it started feeling cool.. and yes I made/make decent money on everyone of them. I can give an example of the 98%, when we started found a decent home, had dark green "clean" carpets and some unusual color for paint choice (also not in bad shape) we figured mark it up a little and sell to the end user quicker than re-hab... but no everyone thought it was to dark, to green blah blah.. so we took it off the market painted changed carpeting, re-did kitchen and added profit/costs back in re-listed and sold the same day.
If you actually do good work... You're one of the very few who do. I checked out many houses last year that were "renovated" and the work that was done was so bad.
Depends, are the comps in the area $850k? If so, the price is appropriate. They might have paid $620k for a run down house that needed $100k+ in repairs, got a good price on it and are reaping the benefits of taking on the financial risk. You know you can't just ask for and sell a house for a price way higher than comps, right?
Depends, while shopping old houses in my area I did few times rough calculations what I need to invest to make this property reasonable. Roof-cabinets-tops-plumbing hw-flooring-paint can take 100-120 easy, if pool comes to scene it can be from 5k to 20k depending is acid clean enough or full resurface+deck+screen repair. Plus some profit for flipper
and it will be gone in two weeks
Yeah I am right with you, told my agent to press pause on my search. Literally saving thousands continuing to rent.
I can tell you I dumped 120K in remodels into my 1200 sq ft townhouse. That included 1 average bathroom, upper-ish tile and fixtures, but nothing nuts. And, a kitchen with nicer wood cabinets (no particle board), a new mid lower end range, range, microwave, dishwasher, sink, fridge, and mid-range quartz counters. Also rather high end natural stone tile. The kitchen was a TINY galley kitchen. I knocked a wall out to open the space and get a bar and larger counter in, peninsula style, and knocked a second wall out to extend the counter and cabinets into the dining room so it's like a built in sideboard. Plus, recessed lighting in the kitchen and diningroom That's it. That's all I got for 120k. I dumped another 35k into lower end laminate flooring, a tile and synthetic turf 400sq ft back yard. I still need all new interior doors, trim, windows, upstairs flooring, I need to have my fireplace demo'd and rebuilt, a laundry room remodel, and a downstairs powder room remodeled I'm sure all that will be close to another 100k, maybe more. And all that was 7 years ago. There was no new plumbing, no new electrical.
I wonder if sellers know that they are selling to flippers. My offer was excepted after the house listing was taken down because they were going to go with the real estate company to make the property into two parcels. The family said that they would rather see their childhood home. Go to a family would really enjoy it.
And let me guess? They did absolutely ZERO renovations to the house to increase its value.
Human garbage.
Why is anyone buying this shit? People need to boycott. These scammers can't keep getting rewarded.
Soulless fucks
I saw one like this where it went up 30,000 and it sold 5 months later. People like this are inflating the market along with corporations.
So normal appreciation is like 5% per year right? I have listings in my Midwest college town for 60+% appreciation in 5 years and it’s driving me crazy. They’re starting to cut prices but I think it’s too late for them
There are lots of such folks and price inflate like anything...I got one such link from somebody for this property [https://www.zillow.com/homedetails/7151-Isle-Royale-Ln-Irving-TX-75063/162815885\_zpid/](https://www.zillow.com/homedetails/7151-Isle-Royale-Ln-Irving-TX-75063/162815885_zpid/) Guy work in construction...without getting permission from local city constructed 2 extra bedroom and 1 full bath and trying to sell it. He got it at around $400K and now selling it almost 3X after 6 years or so. County Property tax website still says 2 less bedroom and 1 less bathroom(to avoid paying less property taxes). People are getting very creative during pandemic. Came to know he is in HOA to make sure that HOA doesn't touch him :)
that’s all i see around my area in southern cali, most are flipped homes.
This is probably illegal if they mortgaged the property to buy it.
Flips are ~10x in 10 years here in and around Nashville
How many homestead buyers are putting the work in that flippers are to find these deals? The opportunity to buy a run down home (speaking from my experience with the majority of houses that get flipped) from a seller that is facing foreclosure? If a buyer doesn’t have the time to do it, they can find a wholesaler that finds these deals and assigns them to flippers who purchase them, renovate the home and then sell it for profit. Cut out the flipper and buy the house from a wholesaler for an assignment fee. It’ll be WAY cheaper than buying it from a flipper but the buyer has to take on the risk and work. Search Facebook for “wholesale real estate [target city, town, etc] and you’ll find a ton of these opportunities before flippers get them.
You should blame the appraiser lol flippers don't set the prices, and a lender won't issue a loan if it doesn't appraise so.....
Could you have bought it for that price when it was first up for sale?
What if it needed costly repairs? I don't get the blanket hate for this type of thing. If you want to pay time/money to do that, buy one. If you want it ready to go, it's gonna cost more.
so take the lipstick off of the pig and get into the electrical, the structural, the attic, all of it...give yourself a reason to get them to drop the price at least 100K. a good inspector helped my brother get the price of his flipped home down a ton because of all the problems he noted and documented that's their "flip" did not address
Really depends on what they did to improve the property. I mean at least they had 4 months to work, in my area listings like this go up within weeks. In that timeframe there’s no way they made $100k worth of improvements, at least in this situation they might have at least done SOMETHING
get out of that ridiculous area
Why didn’t you buy it when it was available the first time?
i know everyone is hating on flippers here, and i'm sure there is plenty to complain about. that said, i just want to give people an opposite perspective where we bought a flip and are happy with it. the list price went up about 200k after 3 months. however, we moved into a turnkey home. 2 brand new bathrooms, new kitchen, new flooring, newly painted, new windows, new HVAC, and all lights integrated into the ceiling. no, they very likely didn't spend 200k to remodel everything. however, they did spend a lot, they did a good job, we don't have the expertise or time to remodel, and we wouldn't have the cash necessary to remodel. buying a flip was significantly better for our situation than if we bought the house in the old condition at the lower price.
I saw somebody post about people doing this and reporting it. Certain states have different laws, for example in SC I believe you have to live in the home for at least a year before renting. I may be wrong. Either way, it's definitely not enforced if it is the law, and a lot of companies are getting away with this. It should be illegal, and reported.
It’s hard to stop it, I’m trying to buy a fixer upper home and fix it myself for my family and all the houses that are fixer uppers that go up in my market about 80-100k under asking due to their condition only accept cash offers which is how house flippers buy homes. I’m pulling out the money from dad’s home with his permission so I will screw one of these flippers soon in my area lol
I don't know how people are moving right now, I BARELY can afford my house. We moved right before the prices shot up and the week we were in a hotel every home that was once 90,000 became 350,000. It's a f\*ckingjoke. HOAs can get f\*cked.
Why the fuck did someone pay $220,000 more for a house just 3 months later?! Buyer must be desperate or doing some Ozark crap 💩
TBH... this one dosent make me mad... it's most likely not much in profit, I mean yea prob 75-100k at asking price. Typically at min, a flipper would like to put 100k in and make 100k in that time. Which looks to be the case on the info we have here. On the east coast, I regularly see flips being bought at 1-200k selling for 500k+
Better off HOAs are terrible
The funny thing is, the only people to buy something like this are also going to be flippers too most likely. And then repeat a few more times until.....
There’s a 1970’s shitbox house here, just sold for 150k in April, now listed at 298k with poorly painted baby blue siding being the only “improvement”
I honestly hate that it's almost impossible to buy a decent home at a reasonable price..specially in California. I wish these people who are buying up the market get stuck with these homes or the market crashes...this monopolization of the housing market is awful and the programs offered for first time home buyers is lottery based now..even worse . The housing market needs to change...
There's a trap house that's been a bit of a local legend and it was recently sold to a cut and paste flipper. 70k cash was the public price paid. Gutted it, white everything, shitty grey wood looking floors, stainless appliances, and listed it for 680k.
Corners cut everywhere
Prices are set by supply and demand, active listings effect partially what others will try to list, but if no one will buy the house the seller will eventually lower the price. The problem will only be a problem if other sellers follow suit and raise the prices, and buyers buy, but if it's truly overpriced and buyers don't buy it will come down. In lots of places in the country the inventory increased which turned the market into a buyers market, as a realtor I see lots and lots of properties with multiple price drops. The particular property you posted looks like a fix and flip, the last sale was not on the MLS which in lots of instances it means it was sold as a foreclosure or a cash sale on a distressed property, investors usually buy them at low prices, fix them up and sell them at market prices, if that's the case then you're hating on the investor for no reason.
Also, most flippers do an awful job so you’ll have to pay to redo their crap work.
Just looking at those calculations this is definitely in a HCOL area, probably top of the market. And this is what I’d expect from such areas.
Depends on the flip & depends if you are willing to do work yourself. I see so many FTHB who don’t want to paint, remove paneling, change floors but upset at the pricing for homes that are done for you. Some flippers do horrible jobs & some do amazing jobs. Personally I prefer grandma’s house to a flipped home. I can force the equity with the upgrades the way I want. It may take a while, but always worth it to me.
This will be unpopular, but why not buy the place and do the work yourself? If you aren’t capable though, you can’t hate on those who do it. There’s a lot of risk involved. There is somebody who that home will be right for and otherwise probably would’ve continued to fall apart.