You're a year late for the kind of flipping I saw where I live, which was Hilton Head Island and Charleston, SC area. People were buying "hot" properties and turning around and selling them months later for 20-30% more than they paid. Inventory is now way up in many of these areas. Some of those who hoped to flip can't sell and even break even now. So they're now looking to rent them to absorb some of the carrying costs. Sure, it's a buyers market but some areas are still overpriced. And if/when you buy you may not be able to flip it for any decent profit given transaction costs as well as the competition (inventory). Soon they'll be even more on the market with people defaulting on mortgages. Lots of people with adjustables are seeing their payments skyrocket as they adjust.
I heard a story, maybe it is true. A neighbor told me that so many flippers are stuck with houses they can not sell that the flippers are renting houses section 7 to low income families. We have the odd situation of having welfare bums living in newer, beautiful houses in fashionable neighborhoods because the flippers need the money.
yeah, in my area, the ones who bought at retail-pricing in the past couple of years are stuck big-time. Properties aren't selling at appreciated prices and if you do a search for "discounted" on CraigsList, you'll find the numbers are increasing daily. Most of these folks had their mortgate payments increase by +30-50% over the past couple years due to interest-only and ARM loads... suckerzz.... So now, their only resort is to rent out the places at market-price, about 40-60% of the mortgage. So they're losing money every month... waiting... waiting... waiting... OldTrader's got the right idea. The current situation is very similar to the late-'80s. Anyone buying then at the last peak had to wait for at least 7-8 years just to break-even. And even then, due to inflation, they were still losing money on real-estate. I think what OldTrader's saying is that regardless of the market, be it on the upswing, at the peak, or even on the drop, you can "flip" properties and make a profit by buying at a discount to retail pricing. That means you don't buy from the real-estate listing in the Sunday paper, you don't buy from an agent who's making their commission, etc. Foreclosures on the courthouse steps are one way, bring lots of cash. The numbers of foreclosures in this area has increased by 2-3x this past month compared to a year ago... lots of good deals...