Are you considering property flipping despite the current market values? Do you think that this could still be profitable despite the condition of the housing market? Does the housing market affect property flipping success?

The Status of the Housing Market

If people would talk of the status of the housing market, you’d hear of people lamenting over the loss of their homes to foreclosure. The lending and mortgage companies are left with a lot of unpaid mortgages and loans. The only option left for them is to foreclose the properties. People are also resorting to rentals because they cannot finance house purchase. The lenders have also imposed more stringent qualifications and requirements for loans and mortgages.

With the recession in the country, industries are affected. One of the industries that take a major blow is the real estate industry. This is why it is very important to maximize your profit by anticipating movements in the market. This is why market timing is very important in property flipping.

What is Market Timing?

Market timing is actually the art of buying properties at a low price and selling them at a higher price to earn profit. This is crucial to successful investing.

Nowadays, opportunities are knocking on the doors of every investor and people who are into property flipping. The prices of houses and real estate have dropped considerably. Although the housing market condition has affected lending companies, people are not deterred from purchasing properties especially that more and more house are being sold at a bargain.

photo credit: Justin Shearer

You could say that despite the housing market crisis, property flipping is still a strong venture. If you’re into property flipping, you should be good at market timing. Since the prices are dropping to their all-time low, you could say that this is just the right time to purchase properties and sell them.

In market timing, however, you are encouraged to study the market and wait for the time when market prices are going high before you actually sell the property. This is great if you have the money to invest in the properties. If you, however, need to secure loans to finance your investment, you can’t afford waiting to sell the property. You need to sell them fast or else you’d end up with a neck load of financial problems.

What is great though about the market is that with the low, low prices, you can afford to sell the property immediately after purchase. You can mark up the price just enough to earn profit. You couldn’t, however, raise the price to the extent that nobody would be able to afford the property. You have to take into consideration that there is a recession and you cannot deny this.

Your target market is the people who have good credit history and who would be able to secure a loan and people who can afford to buy properties outright. These people would also take into consideration the difficulty caused by the recession. So, if you want to make a sale, you have to price your properties well.