BUSINESS

Only 3 Cities Look Good for Home 'Flipping'

BOSTON ( MainStreet) -- A study by real estate site HousingPredictor.com finds there's little reality in reality TV programs that make "flipping" homes for fun and profit look easy.

"TV shows are for entertainment. I've never met anybody who really did flips like they do on TV," says Mike Colpitts of HousingPredictor.com, which recently concluded just three U.S. markets appear ripe for home flips this year.

Flipping typically involves buying foreclosures or run-down homes on the cheap, making a few cosmetic updates such as new paint or carpeting, then "flipping" the properties to new owners at higher prices for some quick profits.

Lots of Americans made bundles of cash flipping homes during the U.S. housing boom.

"There were people who made upwards of $10,000 a flip, and in many that I did, we netted upwards of $50,000 in a few months," says Colpitts, who flipped some two dozen properties earlier in his career.

Unfortunately, today's housing bust means the days of easy home flips are long gone.

"Most places are way too risky for flipping a home these days, with home values falling in the majority of the country and foreclosure rising," Colpitts says. "You have to be sure you're stealing a house before you even consider doing a flip today."

Here's a look at the only three markets HousingPredictor.com believes are ripe for home flips in 2012:

Third place: El Paso, Texas
This 800,000-person metro area has been adding population because the U.S. military's 2005 Base Realignment and Closure initiative called for expanding operations at nearby Fort Bliss.

Analysts estimate the expansion will eventually bring 65,000 additional troops, spouses and children to the area -- making it ripe for home flips.

"Military realignment has boosted the city's population, and one thing military personnel usually want is a nice place to call home since they move so often -- usually every two years," Colpitts says. "You can cash in for a nice profit picking out the right home to flip."

El Paso's location along the U.S./Mexican border also means the U.S. government's Drug Enforcement Administration, Immigration and Customs Enforcement agency and Customs and Border Protection department all have major operations in the area. The city is also home to the 22,000-student University of Texas/El Paso.

Second Place: Miami Beach, Fla.
After soaring during the housing boom and collapsing in the subsequent housing bust, Miami Beach's real estate market appears to have finally begun a rebound.

Colpitts says bargain hunters from around the world have swooped in to the 2.4 million population metro area, making profitable home flips possible

"Miami Beach's home and condo markets are in overdrive," he says. "International resort buyers are flocking to the region to buy second homes and condos at discount prices, and many places need to be fixed up before they can fetch top dollar."