House flipping in South Florida rose only 8 percent last year after nearly doubling a year earlier as investors start to focus on other areas, a new report shows.
In 2013, buyers flipped 3,554 single-family homes in Palm Beach, Broward and Miami-Dade counties, compared with 3,306 a year earlier, according to RealtyTrac Inc. Only 1,702 were flipped in 2011.
RealtyTrac defines a flipped house as one that is bought and resold within six months.
“South Florida is still a really good market for flipping, but it tends to be more saturated,” said Daren Blomquist, spokesman for RealtyTrac, a foreclosure listing firm in Irvine, Calif. “Some other markets are just more ripe for the picking.”
Another factor in the leveling off in South Florida is the abundance of investors who prefer to buy and rent rather than resell, Blomquist said.
Flippers in the tri-county region realized an average profit of 45 percent last year, RealtyTrac said. Baltimore’s profit was 51 percent, while Seattle was at 50 percent. Virginia Beach and Jacksonville also were top markets for flipping in 2013.
Lex Levinrad, head of the Boca Raton-based Distressed Real Estate Institute, said South Florida flippers are struggling to find properties that make sense financially.
In some cases, novice investors are bidding up prices. He said one flipper recently bid $75,000 on a two-bedroom home that would have only been worth that amount after it was renovated.