AB 1771 aims to reduce housing speculation by investors, free up properties for individual home buyers
House flippers could be taxed 25 percent of their profit under the California Speculation Act, a bill introduced by Assemblymember Chris Ward, D-San Diego.
Assembly Bill 1771 aims to discourage real estate speculation that Ward said drives up home prices as equity investors outbid individual home buyers.
read more at: https://www.sandiegouniontribune.com/news/politics/story/2022-03-09/housing-speculation-bill
High home prices cause house flippers to pull back
- After two straight years of gains, the rate of home flipping flattened in the second quarter of this year.
- The number of homes flipped fell to 5.6 percent, down from 6.9 percent in the previous quarter.
- Home flippers saw an average gross return of $67,516 in the second quarter, representing a 48.4 percent return on investment. That is down from 49 percent in the previous quarter.
House flipping has seen a huge run-up in the past few years, as investors take advantage of tight supply in the market and fast-rising home prices. Popular television shows glorifying the process have also turned regular Joes and Joannas into real estate renegades. Those high prices, however, are now taking their toll.
After two straight years of gains, the rate of home flipping, defined as buying and selling a home in the same calendar year, flattened in the second quarter of this year, according to a new report from Attom Data Solutions. Nationwide, 53,638 single-family homes and condos were flipped in the second quarter, which is 5.6 percent of all home sales during the period. That rate was down from 6.9 percent in the previous quarter and unchanged from a year ago.
Why the slowdown? A drop in profits.
read more at: https://www.cnbc.com/2017/09/14/high-home-prices-cause-house-flippers-to-pull-back.html?__source=realestate%7Cnews%7C&par=realestate
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Nearly two out of three real estate investors in California who work with a Realtor plan to buy and hold homes for more than a year instead of flipping them for quick profits, a recent survey from the California Association of Realtors shows.
That stat suggests a general shift in industry strategy. When foreclosures flooded the market and home prices plummeted, investors picked up heavily discounted properties, renovated them and executed quick sales.
Considering buying a “flip” but think the upgrades are not worth what the agent is reporting. Contact the appraisers at www.scappraisals.com for your value questions.
Nearly 30 percent of San Diego County home sales in June were completed by absentee buyers, likely investors or second-home buyers, show figures from real estate tracker DataQuick. The share of absentee buyers peaked at 31.5 percent in March.
“It’s probably the most competitive that I’ve ever seen it in San Diego,” Denney said. “It’s still a lucrative business, but you have to have an amazing team to put out an incredible project. And you’ve got to know what you’re doing. The days of not knowing much and making a lot of money are kind of over.”
Read entire article at: http://www.utsandiego.com/news/2013/jul/30/tp-home-flipping-opportunities-may-be-falling/
Disclaimer: for information and entertainment purposes only