Investors find flaws in FHA anti-flipping rules

Restrictions on resale price, same-day closings irk some

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In February, the Federal Housing Administration suspended for one year a regulation designed to hold back "flippers," or investors who acquire single-family homes and then put them back into the market very quickly, often within 90 days. One would think this would be party time for flippers -- and it is! -- but there are some caveats within the rule suspension that still limit completely unabashed flipping. At least the handcuffs are off and that's welcome news. As Paul Barrow, the fellow behind, extolled, "This will be music to investor's ears everywhere! We no longer have to wait and plan to hold for 91 days to contract and sell, fix and flip projects to first-time homebuyers." A little history first. Back in 2003, the FHA decided to no longer approve loans on properties that were resold within 90 days of original purchase. In those halcyon days, the FHA feared flipping homes was causing prices in individual neighborhoods to unnatu...