flipping homes in California

The Game Of House Flipping

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The business of real estate in California is highly competitive. It may be difficult to get your hands on your first flip project but selling the same may just turn out to be a piece of cake. The rate of flipping homes in California has taken quite a nosedive; dropping 90%. Despite such a tumble, the profits have never been higher. The gross profit a majority of the properties in California are bringing is a whopping $73,766. The national gross profit a home made was $67,000 in the year 2022.

The median value of a house rose by 20.1% in 2022. As a result, this pushed the price to $734,612. This has to be kept in mind in the fourth quarter of 2021, the median sale of houses in the United States on a national average is $411,200. This solidifies the fact that the median home price in California is almost twice the national average of the country.

Real estate investment properties vary from city to city. The median selling price in some of the cities in California in January 2022 are:Los Angeles: $980,000

San Jose: $1,300,000

San Diego: $795,000

Riverside: $595,000

Ventura: $803,000

Sacramento: $460,000

Since the price of homes in California is so much, private lenders are more likely to raise the loan limits which can prove to be beneficial for house flippers as they can bag more profits in the process.

Absentee Owners

It is essential to have a knowledge of absentee owners and gauge the pros and cons of each type of property. There are varying reasons behind people becoming absentee owners. Prior to zeroing in on a marketing strategy, it would be good to keep these factors in mind.

Absentee owners own properties but are not primary residents. Properties owned by absentee owners are also called non-owner-occupied properties. When you are curating an absentee owner list, these are the following criteria that you would do well to keep in mind:

Exemptions in tax: In several states, if an owner of a home decides to take a tax exemption, it can only be for their primary residence. This is not a problem in a lot of cases, as the primary residence is generally their only property. However, for people who own a number of properties,

Tax Bill Is Sent To Different Address: The government sends mails to the owners of the property usually at the home address of the same.

Why Absentee Owners Are Such A Rage?

Absentee owners can prove to be a really coveted potential client. Property managers can be more than happy to manage the property of an absentee owner. Real estate agents can fall over themselves in order to list the home of an absentee owner and real estate agents can make offers to buy the property of absentee owners.

Absentee owners can be a huge bargain as they are more often than not good for business. Some of the reasons why such owners can be willing to sell are as follows:

If they are facing problems with the tenants.

Rents leading to unsatisfactory returns on investment on the current property.

Frequent changes in the law such as those pertaining to rent.

Emotional detachment – when the owner is not emotionally attached to the property and only perceives the same as a money machine.

When the owner is no longer able to maintain and pay for the property.When the property has been passed down to an heir who lacks knowledge about the market and has no plans to live in the same or in the town.

However, not every absentee owner would be willing to sell or be in need of your service. So, before making an absentee owner list, make sure they meet the aforementioned criteria.

Is A License Mandatory For Flipping Houses?

You do not need to be a licensed real estate license in order to flip houses, neither in California nor in other states of the United States. It can, however, be a good idea to have a license if you want to make big in this industry.

Having a real estate license gives you the ability to skip over real estate agents. It will also waive the brokerage commission on buying and reselling a home.

A real estate license also gives you the capability to access a number of listing services, also known as Multiple Listing Service (MLS). You will also be able to list your properties with ease, earn referral commissions, get clout in the local real estate community, earn credibility, and network with your peers in the real estate business. In other words, you will have more perks than someone who does not have a license.


Flipping homes in California is not illegal but there are some forms of the same that are actually not legal and it would be in your best interests to avoid them. Mortgage and loan fraud can land you in serious trouble. It is not illegal to sell the property at a price higher than its actual value but it is illegal to mislead the potential buyer and/or inflate the price to bag the deal.

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