The “flipping” of homes in California declined to its lowest level in more than three years, according to, a company that offers information on real estate sales trends and property values.

Investors are apparently pulling back, and “chances for a quick turnaround and profit are diminishing,” according to a company statement.

During the second quarter, 2.4 percent of the existing homes that sold statewide had been owned for six months or less. That was down from 3.2 percent for the first three months of this year and down from 3.5 percent for last year’s second quarter, according to

Last quarter’s activity was the lowest since first-quarter 2003, which also had 2.4 percent. The recent peak in flipping was during first-quarter 2005 at 3.8 percent, the company reported.

“Flipping activity is one of a number of risk factors we look at to see how healthy and stable a local market is, all the way down to the neighborhood level,” said Mike Ela, president. “What we look for when it comes to flipping are the big ups and downs, which can indicate stress.”

When factoring in commissions and costs, 24.7 percent of the second quarter’s “flip” sales resulted in a loss for the seller, the highest percentage since 25.8 percent during first-quarter 2002, according to the report. The second quarter was up from 24.4 percent during the first quarter, and up from 14.4 percent a year ago. Of those who lost, the median loss was $30,100.

Overall, flippers sold the homes for a median $44,500 more than they paid. Profits were lower if there were improvement costs associated with the properties, the company noted.

“Flipping activity is always going on, as people identify opportunities, and they jump in if they have the money. This is not part of the core housing market, where people are putting roofs over their heads. This is a roll of the dice, and the investor may do well or not,” Ela stated.

By area, flipping activity varied during the second quarter. Among the major counties, it ranged from 1.1 percent in Napa County to 4.8 percent in Kern County.

Show Comments Hide Comments


Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
By submitting your email address, you agree to receive marketing emails from Inman.
Thank you for subscribing to Morning Headlines.
Back to top
Only 3 days left to register for Inman Connect Las Vegas before prices go up! Don't miss the premier event for real estate pros.Register Now ×
Limited Time Offer: Get 1 year of Inman Select for $199SUBSCRIBE×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription