Despite strong demand for rental housing, investors continued to prefer flipping to renting in January, according to Auction.com's Real Estate Investor Activity Report, a nationwide survey of real estate investors bidding on properties offered for auction.
However, January's report shows that investors had only a slight propensity toward flipping (51.7% flipped versus 46.3% rented), while one-time individual investors were more inclined to hold-and-rent (29.1% flipped versus 67.5% rented).
Auction.com is careful to point out investor intent varies considerably by the type of auction (live event versus online auction) and the investor profile.
The report shows that investor intent also varies greatly by region; for example, in Arizona 74% of homes auctioned in January were flipped while 20% were rented, compared to Missouri where 40% of homes were flipped and 60% were rented.
‘Considering recent reports that have suggested a shortage of rental units in some metropolitan areas, we'd expect to see more investors starting to move toward a buy-and-hold strategy to address this market opportunity,’ says Rick Sharga, executive vice president for Auction.com, in a release. ‘We know anecdotally that some flippers purchase homes specifically to sell them to other investors who re-purpose the properties as rental units. But, it will be interesting to see if more investors move away from flipping and towards rental strategies over the next few months if demand for rental housing continues to rise.’
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