Tuesday, August 14, 2007

Flippers in Key West Losing Their Guayaberas


Flippers, who in a frenzy bought up Key West and drove the affordable housing problem to crisis level - are now taking big losses.
Here are a few of the many properties that are selling at a loss:

Address
Date Purchased
Price Paid
Currently Offered For
$ Loss
1116 Whitehead Street
April 2004
$485,000
$309,900
-$175,100
1213 Watson Street
August 2005
$580,000
$369,000
-$211,000
1013 Howe Street
September 2004
$500,000
$429,000
-$71,000
206 Olivia Street
June 2005
$607,500
$433,000
-$174,500
2811 Staples Ave.
Sept. 2004
$661,300
$433,500
-$227,800
1202 Margaret St.
March 2005
$790,000
$669,000
-$121,000
1023 Packer St.
April 2006
$799,000
$699,000
-$100,000
4 Go Lane
May 2005
$1,450,100
$1,299,000
-$151,100
3425 Flagler Ave
Nov. 2004
$595,000
$425,000
-$170,000
3314 Northside Dr. #101
May 2006
$541,000
$430,000
-$111,000
1202 Margaret St.
March 2005
$790,000
$669,000
-$121,000
3719 Donald Ave.
March 2005
$828,000
$799,000
-$29,000
31 Seaside South Ct.
August 2005
$1,138,100
$995,000
-$143,100
1524 Rose St.
January 2005
$985,000
$845,000
-$140,000
3327 Harriet Ave.
February 2004
$370,000
$319,000
-$51,000
3308 Eagle Ave.
Sept. 2004
$485,000
$329,900
-$155,100
3324 Eagle Ave.
Dec. 2004
$520,000
$338,900
-$181,100
30 Kingfish Lane
Jan. 2005
$575,000
$365,000
-$210,000
3326 Eagle Ave.
Dec. 2004
$587,000
$375,000
-$212,000

Is the era of flipping over?Can we go back to fishing, being about more than money, and having neighbors?I hope this is GOODBYE flippers. You will not be missed.
Like this post? Let us know:

18 comments:

Anonymous said...

funny we never see this kind of honesty in the "newspaper" thanks for keeping me informed on what is really going on in kw!!!

Rock said...

That's the way to mine data, Dave!

I'm reposting to Motley Fool.

I will email you with questions about the data.


Rock

Sally O'Boyle said...

Excellent chart, Dave. I would expect sale prices to be 10% less than that. Perhaps you can get the actual solds data from your supplier?

I've been occasionally posting a pdf file with recent sales data but it has not included the previous sale price. Didn't occur to me, but that is the most telling figure.

Is the KWC still advertising last sale price like they used to in the Good Deeds ad? (I don't see that in the online news.)

Cayo Dave said...

Hi Rock!
Hi Sally!
Maybe next time I'll look at sales that have occurred and compare that to previous purchase price. Good idea Sally.
The Citizen still puts the Good Deeds in the paper - but it is pretty skinny.
One thing I did notice (that Rock posted about) - properties are being relisted as a New Listing even though they have been on the market for many months. This has the effect of resetting the DOM (days on market). I could understand if someone was getting rid of their realtor and trying a new one. But some of these relistings are owned by realtors - and appear to be manipulating the DOM.

Anonymous said...

One correction: We don't know if these buyers purchased these properties with the intention of flipping them, or if they bought them as a long-term investment but increases in insurance costs and property taxes have made it impossible for them to hang on any longer.

Cayo Dave said...

there is an old saying on Wall Street.
"You know the difference between a short-term investment and a long-term investment? A long-term investment is a short-term investment that didn't work out."
Down markets have a way of flushing out the short-term investors - in real estate called a "flipper" - and this is what we are seeing now.
If these were long-term investors - how could they have not planned for the taxes and insurance. In actuality, they are most likely flippers.

caddis said...

Just curious, but what kind of a place does $309,000 get a buyer on Whitehead Street?

Anonymous said...

--Simple rules to purchasing the home you can afford to keep---
1- the house is more than 4 times your income? walk.
2- DO you need a piggy-back loan to qualify? walk.
3- Can't afford the mortgage at fully indexed rate? (ie after the rate re-set? walk.
4- The broker fudging numbers to make you qualify? walk.
5- The broker pushing an ARM on you? walk.
6- Only qualifying through ARM? that house is not for you, walk
7- The broker pushing an Interest Only Loan? walk.
8- The broker pushing a Negative-Amortisation loan on you? walk.
9- Mortgage taking 50% of your paycheck? Walk.
10- Just used a credit card to pay your mortgage? Let them foreclose.
11-Buying thinking of equity first, rather than shelter? maybe you shouldn't
12-Getting fliers under your door from shaddy men claiming to have all solutions for your mortgage/housing headaches? trash them

Anonymous said...

--Simple rules to purchasing the home you can afford to keep---
1- the house is more than 4 times your income? walk.
2- DO you need a piggy-back loan to qualify? walk.
3- Can't afford the mortgage at fully indexed rate? (ie after the rate re-set? walk.
4- The broker fudging numbers to make you qualify? walk.
5- The broker pushing an ARM on you? walk.
6- Only qualifying through ARM? that house is not for you, walk
7- The broker pushing an Interest Only Loan? walk.
8- The broker pushing a Negative-Amortisation loan on you? walk.
9- Mortgage taking 50% of your paycheck? Walk.
10- Just used a credit card to pay your mortgage? Let them foreclose.
11-Buying thinking of equity first, rather than shelter? maybe you shouldn't
12-Getting fliers under your door from shaddy men claiming to have all solutions for your mortgage/housing headaches? trash them

Anonymous said...

You can even add substantially more to the price decrease because those are prices at which the houses are offered, and generally still not selling!!! Final sale price will usually be a lot lower.

Anonymous said...

I thought flipper was a fish. How can fish affect the housing market?

Anonymous said...

Good article. I would like to get a house someday, but with these RE flippers, I am locked out.

Anonymous said...

Flipper was really an aquatic mammal (thanks Wikipedia.)
At least he was a friendly mammal.
House flippers have driven home prices out of reach for the average first time home buyer.
What does that make a house flipper?

Anonymous said...

but its different in key west

Anonymous said...

Good article, but some important info was left out. Some of the houses identified in the article were hurricane damages, ergo, their value was decreased by 'Mother Nature', These houses were covered by insurance, so actually, gthe 100k - 200k, the difference in the 'sales price of the house was offset by the insurance $$ the owners received. Speaking of flippers. There are those individuals who buy, make quick cosmetic 'fixes' and sell for as much as possible. BUT there also are those who buy houses most people would never ever consider purchase (those with major problems - 'ratty looking' houses, invest their expertise and time and $$$ into the property,then sell it for a profit (and not always a large profit) 'Flippers' by your definition, probably... Bad guys tho. - 'Don't think so'F

Anonymous said...

Wrong! A flipper is someone who has no intention of either living in the home or renting the home. This includes speculators and pre-construction get- rich- quick schemers.

Anonymous said...

Please explain what is wrong with someone who makes an investment in a home that is in major disrepair and competently and expertly renovates the property using THEIR OWN MONEY. Then sells the property to a homebuyer who has the INTENTION of living there.

I bought a home in Old Town that had been renovated. It was not a cheapie cosmetic fix. I hear from the neighbors that it had previously been a Sh**hole. I now own the home and love it. I NEVER would have been able to buy it and come up with the money required to do the work. Thank god someone else was there to do it for me.

I feel I paid a "fair price" and even with what has gone on I still have very good equity. Did they make a profit? I'm sure they did. But we all make a living and if theirs is HONEST and they are improving the neighborhood and creating a product which has a demand there is NOTHING wrong.

You CANNOT characterize with a *negative* everyone who renovates a house without the intention of living there or renting out. As the old saying goes "Don't throw out the baby with the bath water."

Too many of you lump everyone into one basket without thinking it through. With your line of thinking the long time residents who sold their homes and moved out of key west when the values skyrocketed should be held accountable for "fueling the fire" as well. Which seems as preposterous as calling all "flippers" bad. And NO I am not a "Flipper" I just bought my beautiful house from one.

Cayo Dave said...

To the previous anonymous commenter -
The problem with the flippers was a temporary one - once the market turned down (or even flat) they disappeared. But they did drive up prices, and made everything affordable unavailable.
I am glad you are happy with your purchase from a flipper. But without knowing how much you paid per square foot, I can't say if this flipper was part of the problem or not.
Either way, enjoy your house.