Investors Show Slight Favor to Flipping

July 15, 2015

Home flipping continues to inch out a hold-to-rent strategy among investors who bid on properties at auctions, according to Auction.com’s Second Quarter 2015 Real Estate Investor Activity Report, which is based on survey results of real estate investors nationwide.

“Rounding out the first half of 2015, most of the country and most investor segments performed in a manner very consistent with what we’ve been seeing for about a year,” says Rick Sharga, Auction.com’s executive vice president. 

“We’re seeing two major trends that are driving these numbers. First, we’re seeing a return of the ‘mom and pop’ investor in the single family rental space – smaller investors with an intimate knowledge of their local markets, who are willing to buy properties that deliver long-term returns based on monthly cash-flow. Second, investors focusing more and more on flipping properties in regions where prices have rebounded from the 2008 crash and inventory of homes for sale remains scarce – an almost perfect scenario for investors looking for a short-term profit.”

The survey revealed that investor respondents who were making a one-time purchase strongly preferred a hold-to-rent strategy, while respondents who identified themselves as “full-time real estate investors” favored flipping.

Source: “Flipping Edges Out Renting as Preferred Investment Strategy for the Third Consecutive Quarter, According to Auction.com Real Estate Investor Activity Report,” Auction.com (July 14, 2015)