Should investors ease off flipping till the situation improves?

[alexfardreamer@aol.com]

Considering all the economic factors that show that housing is experiencing a nationwide slowdown, would it not be prudent to ease off buying properties with the intent to re-sell until the situation improves? I suppose really wealthy investors could continue, but what about aspiring flippers who may get stuck with two mortgages and other costs if they can't sell the "flippable" property?

[bartongrl1]

I have been doing a lot of reading on the housing situation, and this morning I read an article that asks "Is the media causing an overreaction to the present situation"? Now, mind you, that is a loose translation on what was said, but it is a possibility.

I wonder how much of the present situation is due to people who have overstretched the limits of their incomes by buying a property that was far more than what they actually needed? How much is because of the job situation, the gas situation, etc?

Keeping in mind that there are more people coming to the age of marrying and buying their first home or renting their first apartment, etc, I would still be flipping and selling regardless of the present situation, if I were still into that.

Plus the fact, that, the people who have already been foreclosed on are going to be needing housing to replace where they had lived.

[alexfardreamer@aol.com]

Clearly I'm no expert on the situation, and I'm sure the media oversimplifies complex economic issues, but there is a domino effect that a few non-media Realtor friends of mine have mentioned to me. If housing is affected, then manufacturing is affected, then the retail market, employment, and so on and so forth.

[patsciacca]

It seems to me as if there must be a way to make money, even in a down market. I keep thinking that people have to live somewhere so I am targeting homes in the price range after fixing up that people buying their first homes can afford.

On one house I have settled for a lease with an option to buy i a year. Their down money is at risk if they cannot get financing at the end of that year. I'll let you know how that strategy works.

Pat Sciacca

[bartongrl1]

Yes, that is one way to go about it. I wish you the best of luck. And please do let us know how this works out.

[JaredfromIndiana]

Originally Posted by patsciacca

It seems to me as if there must be a way to make money, even in a down market. I keep thinking that people have to live somewhere so I am targeting homes in the price range after fixing up that people buying their first homes can afford.

On one house I have settled for a lease with an option to buy i a year. Their down money is at risk if they cannot get financing at the end of that year. I'll let you know how that strategy works.

Pat Sciacca

I agree 100% there are ways to make money in a down market. Lease options, rentals, even flipping is still alive. I have never done LOs or rentals but will look in to doing that towards the end of next year. In my neck of the woods the lower end houses are having a hard time selling because of the buyers not being able to get financed. In Fort Wayne houses between $90,000 - $150,000 is where there is the most action, which is where we are going to be on our next few flips.

[bartongrl1]

This thing with the mortgages is a real mess. I have read that a lot of lenders gave credit to those that were really not eligible for the amount of loans they got. I think that the lenders should do more investigating when it comes to this sort of thing.

Plus a lot of people dont get the complete idea of how a subprime mortgage actually works. They also need to look more completely into stuff.