Know The Difference Minute

Flipping houses was hot for a long time, but it might be coming in for a hard landing.

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Flip. Or flop.
Welcome to the Know the Difference Minute for Tuesday, September 20th.
Flipping houses was hot for a long time, but it might be coming in for a hard landing.
Opendoor Technologies is a major player in the space. At one point, it was selling thousands of homes a month through their iBuying platform which makes light repairs before reselling—often just a couple months after purchase.
Now, with a downturn in the US housing market, Opendoor lost money on 42% of its transactions in August. It’s worse in markets like Phoenix and LA where the losses totaled 76 and 55% respectively.
Flipping always looked more glamorous on TV. Pros will tell you the amount of margin you’d need going into a project was more like 30%. With mortgage rates rising and demand softening, the math might not make sense anymore.
I’m Dave Spano from Annex Wealth Management. That is your Know the Difference Minute.