by Edward Krudy
Home flipping – buying and reselling a home to make a quick buck – has risen in some hot U.S. housing markets, prompting concerns that local housing bubbles could be developing, according to a report published on Thursday.
The report by RealtyTrac found that home flipping in 12 active metropolitan areas last year was above a peak set in 2005, just two years before the U.S. mortgage market started to collapse, leading to a banking crisis and the Great Recession.
Profits generated by home flipping also hit a 10-year high, with home flippers netting an average $55,000 per sale before renovation and transaction costs. Profits topped $100,000 in expensive markets such as New York and Los Angeles.