Making a flipping profit from refurbished houses is getting tougher
Flipping houses - where you buy and sell within a short time frame to make a quick profit - was big business in the early noughties.
In its heyday 4.4% of all properties were flipped in less than 12 months and 16% were flipped between 12 and 24 months, according to CoreLogic's first Property Flipping Report.
It has become harder to make a profit from flipping, so those numbers have dropped.
CoreLogic notes that although flipping remains a small proportion of the overall housing market, flips between one and two years have been trending higher over recent times.
The report found that in 2017 almost nine in 10 properties were flipped for a profit with Sydney and Melbourne the most profitable capitals for the strategy.
"While there are many examples of profitable flipping, it's important anyone considering this strategy understands the costs involved," warns CoreLogic. "Transacting real estate is an expensive exercise.
"Successfully flipping a home involves more than simply selling the property for more than it was purchased for.
"In order to make a profit, flippers will need to recoup their transactional costs such as stamp duty and conveyancing, as well as their selling costs such as marketing and real estate agent commission.
"There is likely to also be interest payments on the debt as well as capital gains tax on the profit."
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