Flipping Houses: Who is to Blame?

Who is the blame for the current housing market mess? Is it the people who host shows that show you how to flip a house for profit? Is it the bankers who are now foreclosing on houses? Is it the person who bought the house thinking they could renovate it and flip it before the bank loan came due?

I believe no one is at fault. For years before this housing crisis happened people were flipping houses. A friend of mine’s dad in the early 90’s bought a house. Used it as his weekend retreat and then over a year renovated it and sold it for a profit. Keep in mind this was before the housing crisis when a mass of people started doing this.

Another time my dad introduced me to a contractor who basically stated his whole lively hood was fixing up old houses and then selling them. He would go all over the U.S. doing this and this was before the housing crisis.

The problem became when no one could buy houses anymore because of a lack of credit, and banks were not lending or else people would still be doing this.

If you have lived in a house fixed it up and then sold it for a profit you have flipped a house. If you have watched a show on how to improve a house and then bought, improved, and then sold a house for a profit you have flipped a house.     

Unlike people who say this is bad, there is nothing wrong in doing this. It is a great way to make money. It’s just you have to do it at just the right time, when people are buying houses.  You can come out with a nice amount of money. It’s when the banks aren’t lending you have a problem.

It’s sad really because a lot of people, contractor, banks, home buyer, and home seller all lose out when the economy is down and out. In fact if it wasn’t for people who over extended themselves with bad floating rate mortgages this kind of buying fixing up and selling of houses would have continued.

In fact I guaranty that when the economy improves and people start buying houses again that flipping will happen again but at a more modest rate.

So I don’t think anybody is really at fault here. Credit dried up and people couldn’t afford to buy homes. Once credit is flowing again flipping will start again.