House flipping is the act of acquiring a home, performing renovations and repairs then selling it for a profit, usually during a short time period. For this analysis, a “flipped property” is defined as a property that was bought and sold within twelve months. Both disclosure and non-disclosure states were included in the analysis, and while price-related metrics in non-disclosure states are not included here, the share of flipped properties to sales can be derived from public records.
At a national level, the ratio of flipped properties to sales reached 6.2 percent in the first quarter of 2018, which matches the post-crash high in the first quarter of 2013 (Figure 1). The first time it reached this level after the housing crash, home prices had just started to recover, and there were still a considerable number of distressed properties on the market. However, the flipping dynamics have changed over time. The share of distressed properties sold has declined significantly, from 30 percent in January 2013 to 4.4 percent at the end of 2017. Additionally, as a result of six years of home price appreciation and limited for-sale inventory, in many areas, home prices have already passed the peak values reached before the market crashed. Consequently, the acquisition cost in nominal dollars for investors has increased drastically (Figure 2). High acquisition cost, tight inventory, and rising flipping activities together point to possible speculation: investors are betting on continuous home price growth.
 CoreLogic Market Trends
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