Skip to main content

The Next Big Thing- Flipping Luxury Houses

Over the past several years flipping houses has become a national phenomenon. Reality television shows demonstrate how a couple fun packed days of remodeling can drastically increase the value of a home before resale. Until recently, middle to low end homes dominated the flipping scene. However, with recent improvements in the market and the rate of foreclosures decreasing, the trend has found its way to more luxurious homes.

Why are Luxury Homes a Good Choice?

The luxury home market was one of the hardest hit during the downturn. Investors took advantage of this situation and purchased homes in discount areas that now have some of the highest home-appreciation rates. Now, the luxury market has rebounded and these investors have found themselves in an ideal situation where under the right circumstances luxury homes are selling quickly.

Mid to lower end homes are no longer as appealing for flipping. For one thing, they are not as many available as there used to be. Many foreclosed homes were bought out by Wall Street investors to rent. Also, while the risk may be less for flipping a lower end home, the payoff is also smaller.

Risks

There are definite risks to flipping high end homes. While lower end homes could see a reasonable resale increase with a few cosmetic improvements, luxury homes often need a complete remake. People willing to put the money into buying a luxury home want to get their money's worth. They want name brand appliances, open floor plans and an overall wow factor. Remodeling a luxury home is a much bigger investment than a lower end home, but the payoff has the potential to make it worth it.

Because of the cost of the investment and the risk involved, banks will not provide loans to investors who want to flip luxury homes. They have to find the money elsewhere. Institutional investors, professionals that have other industries that have made money, and foreign investors have all jumped on the luxury home flipping band wagon. While the initial investment is potentially risky, as long as the home can be remodeled and sold within six months, the payoff is high.


Where’s the Action?

Five markets in particular are the location for over three quarters of all houses flipped. New York, Los Angeles, San Diego, San Francisco, and San Jose are the center of luxury home flipping industry. California is especially appealing for flipping luxury homes because of Proposition 13, a 1978 voter initiative law. Since the law was enacted, tax assessments of California houses dramatically increased compared to home values if the home was unsold. Washington D.C. is also seeing a rise of flipping high luxury homes.

Flipping luxury homes is an excellent investment, particularly in the current market. People are lining up to buy luxury homes. The mid to low end market is drying up. Flipping luxury homes has a higher initial investment cost, but in the right location, the risk is worth it. Since 2011, the number of homes valued over one million dollars that have been flipped has risen 40%. This is the time to take advantage of this investment opportunity and reap the benefits of flipping luxury homes.

Author Bio:

Katie Kent is a real estate professional and published writer from Tucson, Arizona. She specializes in Tucson short sales and mortgages.

Comments

Popular posts from this blog

List Of Common Flowers in Kerala With Pictures

Kerala is one of the famous tourist spot situated on the south of India famous for its numerous wild life and thick vegetation. Like the Himalayan ranges on the north of India,

5 Common Examples Of Website Design Mistakes by Business Owners

This is a guest post by Sachin about five Common Examples Of Website Design Mistakes by Business Owners . When most business owners think about website design, they think about a brochure online. Online shopping sites are making a lot of money with the use of web-based applications to sell products, collect payments an arrange delivery. The only work left to do is pack and send the boxes. Smart applications can even print out the labels, so the only thing left to do it stick them on the box. Unfortunately, in many cases, websites are replacing people. For those of us left with a job, we can be thankful that many business owners make the following mistakes when it comes to websites and web design.


Don’t have one. This is the first and biggest problem of most business owners when it comes to website design. They think they don’t need one. Who can ever really do with less business? The reason why they have not been getting business from online sources in the past is because they have not …

Smart Investors: Three Real Estate Scams You Should Never Fall For

“Honesty is a very expensive gift. Do not expect it to come from cheap people.” –Warren Buffet

 There has never been any doubt that succeeding in real estate takes hard work, determination and commitment.

 It is not some get rich quick scheme as some have been misled to believe. It takes laborious work to see any real results and unfortunately, not all individuals in the industry are prepared for that kind of dedication just to succeed. Resultantly, some would give up with the belief that they are not cut out for that kind of line of work while the rest would resort to sleazy machinations just to guarantee a sale.

 From there, all sorts of scams and fraudulent schemes are cooked up and it is unfortunate that there are investors (especially novices and first-timers) who would be none the wiser and would buy into the scam. No doubt, the real estate industry is a sector that can be extremely profitable. But as it was stressed above, it requires hard work and unfortunately, some people a…

AMOLED display coming to Samsung Galaxy Tab range

This is a guest post by Erica about the arrival of AMOLED display to Samsung Galaxy Tab range.Samsung could be transplanting a seven inch AMOLED screen into an upcoming addition to its Galaxy Tab range of tablet computers.

You may have experienced an AMOLED display in a small portable device before as Samsung, Nokia and HTC have all used them in smartphones to date. However, the expense of producing AMOLED screens has prohibited them from appearing on larger devices like tablets, until now.


The seven inch Galaxy Tab was launched last year but an update with an AMOLED screen would be most welcome, cutting energy consumption and improving colours and contrast ratios across the board.


The rumours about this device state that it will run Android 3.0, feature a three megapixel camera on the rear, a two megapixel snapper on the front and have a display resolution of 1024x600 which is not bad for a device of this size.


The hardware powering the new Galaxy Tab will consist of a 1.2GHz processor w…

Building Blocks for Virtual Businesses : Key technological systems you must have to succeed in the remote business world

This is a guest post by Ripley Daniels about "Key technological systems you must have to succeed in the remote business world.

Whenever I tell friends I had a tough day at the office, they laugh at me. That's because they know I don't really have an office. I work very hard but I work for a company that is completely remote. Only a few of my co-workers ever go into an office at all and when they do, it's only for short periods of time. Our "office" is a virtual one. To us, the traditional office workplace is a thing of the past, alongside Tyrannosaurus Rex, the slide rule, and telephones where you stick your finger in a hole and turn a dial.
Unfortunately, none of this prevents me from having tough days. I still have them. But the reasons have nothing to do with the fact that my co-workers and I don't have a brick and mortar edifice that we can use to plan, strategize, hold our meetings, make presentations, discuss sensitive business topics, build relatio…

Why A Course on Editing is a Good Start for Wannabe Writers

If you’ve been thinking about becoming a writer for some time but you don’t know where to begin, taking a course from industry professionals can be a big help to get you started. If you can study another person’s writing that you know is a good writer, then you can learn to become like them. One of the things that every good writer knows is that you need to be able to edit properly in order to succeed. There are many reasons why editing is so important to a writer, but in order to hone your skills as a writer, you also need to hone your skills as an editor too.
Boost your credibility When most people try to edit a piece of writing, the first thing they do is proofread the work to make sure there are no obvious spelling and grammar issues. This is extremely important because the reader needs to be able to trust that you know what you are writing about. If you can’t master basic spelling and grammar, then the reader won’t be able to trust that you know anything about what you’re writi…

How to Safely Move Computers to a New Office

When moving to a new office, you have a lot to plan. Not only are you boxing up your belongings, you need to move the furniture and computers. With some patience and a plan, you can successfully move your old office to a new office easily and quickly.

If you have old office furniture and don’t want to bring it to the new office, then consider selling it or placing it in storage. If you think you may want to use that old desk again, then wrap in nicely in storage wrap and store it in a storage unit. If you don’t want to use that bookshelf in your new office but it cost you a lot of money and you’ll never find one like it again, move it to storage. A small storage unit for office furniture can be purchased for under $100 a month.

Moving computers can be done if you take the proper steps. Don’t just toss computers into a box for the move. First, turn off all computer equipment and unplug them. Wait until the computers have cooled down before doing anything else.

If you are moving a lapt…

Archive

Show more