The number of flipped houses is at a six-year high. But while such rapid turnover helped fuel the housing crisis a decade ago, advocates and analysts say the current wave is helping to ease a shortage of affordable housing in some parts of the country.
The resurgence of flipping, or selling a house less than a year after buying it, comes as the construction of affordable single-family houses fails to keep up with demand, as builders concentrate on multi-family housing.
In some states like Florida and Nevada, which have large stocks of cheap, foreclosed houses, flipping is boosting the housing supply for homeowners and for investors who want to rent out the properties. The renovated homes are helping to bring downtrodden neighborhoods back to life, while making homeownership possible for some first-time and low-income buyers.
"This flipping activity could be seen as a social good if it's bringing houses up to standards and putting them back on the market," said Steven Swidler, an Auburn University professor who has studied flipping.
But he also warned that flipping can help drive up already-rising housing prices. "In other areas," he said, "it could be putting it beyond the price points for affordable housing for some people. It's all about location, location, location."
A total of 51,434 single-family homes and condos were flipped in the second quarter of 2016, up 14 percent from the previous quarter and the highest number since 2010, according to data from ATTOM Data Solutions. The number of flippers, including individuals, amateur investors and businesses, reached 39,775, the highest level in nine years.
In Tampa, Fla., Memphis, Tenn., and Visalia, in California's San Joaquin Valley, one in 10 homes sold in the quarter was flipped. Florida, Tennessee and Nevada are the states with the highest rates of flipping, with 7 percent or more of homes sold within a year. And in many of those places, the homes being flipped are selling well below the rest of the market, a sign that they are helping to fill a shortage of affordable housing.
Nationwide, 5.5 percent of single-family homes and condos were flipped, a small increase over the second quarter of 2015, but still well below the peak in 2006, when 9 percent of sales were flips.
In some high-priced places such as New York City, housing advocates complain that flippers are reducing the supply of affordable housing and driving out low-income residents and sometimes the middle class.
But in other areas of the nation _ parts of Florida that have been plagued with foreclosures, for instance _ flipping can be part of the process of getting affordable housing back on the market, said Hector Sandoval, a University of Florida economist who has studied flipping in the state.
"Bringing these houses back to the market is good in general for the neighborhoods where they are located," said Sandoval. "It increases the supply, which means prices can't go too high, and they should be affordable, at least for the middle class."
