But that’s not because homes aren’t being flipped, said Jessica Yamamoto, the Dayton franchise operator for HomeVesters, known for its “We Buy Ugly Houses” signs and slogan. The Yellow Springs resident flips homes six months of the year, completing about 15 last year.
“The economy has changed. You can see that with the stock market, with the tariffs that are being imposed upon from China. The increase in tariffs affects the price of all the materials that are needed to renovate a house,” Yamamoto said. “People in my industry are choosing to buy homes that they want to keep and rent out. The homes, they’re still being bought and fixed up, they’re just not being sold because the focus has shifted.”
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When the economy starts to decline, people are laid off from their jobs and foreclosures increase, she said. People who lose their homes need more places to rent.
“The cost of rent goes up…it’s really good for real estate investors to shift their focus when the economy shifts,” she said.
It’s also hard to sell a home as the economy recedes because banks are more picky with their loans, she said, so it’s a move of survival by investors who know it could soon take longer to sell a flipped home. Other parts of the nation are already switching into a buyer’s market, something that will soon follow in Ohio, Yamamoto said.
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It’s also harder for investors to find the right kind of home to turn the right profit, said Michelle Nevius-Haines, a Dayton-area real estate agent who flips a couple homes a year on the side. Her business has slowed down a bit because she can’t find the same homes she could in previous years.
“With the birth of the HGTV craze…everybody wants to do it. It looks fun. They make it look so easy,” Nevius-Haines said. “When I started I used to go down to the sheriff’s sales and I could buy whatever I wanted. There were pages and pages…now with this craze and everybody thinking they can do it, the selection is so nominal that it’s hard to find the good ones because people are overpaying.”
Those flips don’t show up in the sales because the homeowners flip for personal use.
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Both Nevius-Haines and Yamamoto said they don’t only buy homes but situations. Many of the flips come from divorces, families who don’t want to spend the time to fix up the house of a parent in a nursing home before selling or other situations where people are looking to unload homes quickly.
Different investors flip homes differently, said Nevius-Haines, whose niche has become Kettering though she does flip in other parts of the Dayton area. She puts more luxury features like granite countertops and more expensive light fixtures in all of her flips regardless of the price range.
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“Obviously you have to know the value of a neighborhood. You can’t overprice yourself. But even in a smaller $100,000 to $125,000 home, I still put granite,” Nevius-Haines. “It balances out. I spend a little bit more but I got $2,500 more than the other guy because I did put the vanities in.”
The average Dayton flip during the second quarter had an average 76 percent return on investment and $48,800 profit, according to the Attom data.
“It’s just better for everybody in the neighborhood when you have a vacant home or a house that’s bringing down the neighborhood get fixed up,” Yamamoto said.
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