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Unintended real estate flippers are making amazing profits

Aerial view of Rocky Brook Estate in Delray Beach, Florida

Douglas Elliman

Luxury 10 days after closing the year’s most expensive condominium sale for $ 19 million in Delray Beach, Florida Real Estate Broker Senada Adzem I received an unexpected call.

“The buyer called me to sell the house. To be honest, we were surprised,” Azem said in an interview. She talked about how the buyer explained that his plans had changed. He and his family could no longer move to Florida.

“I’ve never been involved in a situation where a client spent such time and effort buying a dream home. You just have to turn around and sell it within two weeks,” Adzem said. Says.

The client has relisted a home known as the “Rocky Brook Estate.” Offer price is $ 23 millionThat was $ 4 million more than he paid a few weeks ago. Adzem said he hopes the unintended short-term reversal will pay off.

“Given the bright red luxury market in South Florida and the splendor of the property’s dazzling resort style, I’m convinced that sellers have a great opportunity to make big profits on this deal,” she said. It was.

The scenario is not an isolated case. It is being rolled out in several US real estate markets as rising stocks and other assets have helped boost the purchasing power of the wealthy. Luxury properties may not be available as many of these buyers want to live in a limited number of markets.

Great room at Rocky Brook Estate in Delray Beach, Florida.

Douglas Elliman

Low stock

The same day the house was sold at 14 Sandy Cove in Newport Beach, California, the buyer decided to put it up for sale.

Photo: PreviewFirst / Stavros Group

Brokers in Southern California Andy Stavros There was also a buyer who became an unintended flipper. Stavros has sold a $ 8.7 million home to a client at 14 SandyCove in Newport Beach, California. On the same day she closed, Stavros said the buyer decided to put it up for sale.

14 Sandy Cove backyard view in Newport Beach, California.

Photo: PreviewFirst / Stavros Group

Stavros said the client’s plans changed after seeing his favorite big house in the area for $ 13 million. So I didn’t need the 4-bedroom, 8-bathroom house I just bought anymore. When she asked Stavros to sell it Her asking price was $ 8.9 million..

View from 14 Sandy Cove in Newport Beach, California.

Photo: PreviewFirst / Stavros Group

According to Stavros, his client’s intention was not to make money, but it can happen. Potential buyers were already calling before the list was published.

“Suddenly there were multiple display requests,” he said.

Deciding to sell millions of dollars of real estate on the same day you close it is usually not a profitable strategy.However, according to South Florida real estate brokers, unintended house flippers can make a significant profit if real estate is in a hot market with desirable and low inventory. Devin Kay..

“We are surprised every day about what things are being sold for,” Kay said.

Properties in demand

Lagos Island is a small guarded community that Sher, Ricky Martin and Billy Joel once called home. Weiden said he intends to demolish an old 4,500-square-foot home on a half-acre site and build a larger new home.

“Someone provided $ 400,000 to my contract shortly after I signed it,” Weiden said in an interview. He added that he declined the offer because he was not a flipper. He and his wife planned to permanently relocate to Lagos Island, and the interests of hundreds of Grands did not intend to change their plans.

“My wife’s intention was to build a house,” Weiden said.

But soon he realized that he wasn’t dealing with all the headaches associated with building a new home, and instead offered to another South Florida home. In February, they relisted 31 La Gorce Circle’s Unimproved Property $ 5.5 Million — A whopping $ 1.35 million more than they paid.

“I thought people could say it was crazy, or there might be a bidding war,” Weiden said.

Even Kay, a Weidens real estate broker, was shocked when the property was sold at full asking price six days after it was relisted. “I didn’t expect to make $ 5.5 million,” he said.

“I’m not a real estate speculator,” Weiden said, but like the stock market, as demand increases and supply decreases, prices inevitably rise. With only 1.2 square miles on Lagos Island, housing supplies are very limited and opportunities for demolition development are even less.

“As a result of a highly competitive market, we were able to turn it over with a 33% profit because we had no other for sale,” Weiden said. He added, “I probably didn’t sell it. Maybe I got six. [million dollars] For that. “

Weiden’s flip surpassed the Miami Beach market. Prices for luxury single-family home sales in Miami Beach rose 20.2% in the first quarter from the previous quarter. According to the Eliman report.

Not only in the luxury market

And it’s not just the luxury markets that are seeing a very informative and unintended reversal.Los Angeles Real Estate Agent Spencer Daily A quick flip at Idaho brought an amazing benefit to himself.

“These are the prices Boise has never seen before. This is an unknown territory,” Daily said in an interview.

The 31-year-old Douglas Elliman Broker purchased land in the town of Caldwell in September.it was Undeveloped 0.8 acre site overlooking the Timberstone Golf Course In a section unrelated to the golf course, about 20 minutes from Boise. According to real estate records, he paid it $ 120,000.

“It didn’t look like I bought it, and I was going to turn it over,” Daily said. “I actually bought the land to build on it.”

He had an architectural plan and was estimated to cost about $ 380,000 to build. Daily expected it would take a year to complete the project, and then he planned to bring the house to market somewhere over $ 600,000.

But three months after buying the land, Daily said something unexpected had happened. The buyer called with an off-market offer that he could not refuse. He sold the property for $ 250,000.

“It was more than double what I paid for it,” Daily said.

Warren Johns is a local real estate agent licensed by Mountain Realty on behalf of Daily. Johns said he helped another client, an unintended flipper, buy and sell undeveloped parcels on the same street. According to Johns, the buyer paid $ 95,000 for the lot and sold it for $ 250,000.

The unintentional reversal brought more than 163% of the original investment back to the client within five months.

Johns explained that the supply of real estate inventories on golf courses in the Boise metropolitan area is low. The Timberstone area parcels also had additional benefits, boosting demand. He said it was one of the few subdivisions in the area where many buyers could bring their own builders.

“Builders couldn’t undertake other developments controlled by other powerful builders,” so they came to the Timberstone parcel as land buyers trying to develop and then sell. I did. Johns helped the client flip to the builder buyer in both lots. He currently has a third lot in the subdivision contracted with the builder.

Daily said a huge short-term profit revealed his decision.

“If it’s profitable and less risky, I don’t know why not,” he said. “I got more from selling a lot than selling a house with finished specs.”

Unintended real estate flippers are making amazing profits

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