‘Flipping’ of homes down in 2006
The “flipping” of homes in California by speculators who buy houses and condominiums only to resell them for a quick profit declined last year to the lowest level since 2003 as price growth slowed.
Homes owned for six or fewer months accounted for 3.2% of all homes resold in 2006, down from 4.2% in 2005 and 3.6% in 2004, according to a report released Thursday by HomeSmartReports.com, a San Juan Capistrano-based real estate research company. In 2003, the figure was 2.4%.
The decline in flipping comes as the pace of all home sales and price increases slows throughout California. In November, the latest month for which figures are available, Southern California home sales dropped to the lowest level for a November in nine years, according to DataQuick Information Systems. San Francisco Bay Area home prices fell for the second time in three months in November.
Of last year’s “flip” sales, 24.9% resulted in a loss for the seller when commissions and costs were factored in, HomeSmartReports.com said. That’s the highest percentage since 2002, when 25.2% of sales resulted in a loss.
Overall, flippers last year sold homes for a median $45,000 more than they paid, down from $52,000 in 2005.