A flip is a house bought recently and resold after work. The work might be a real rehabilitation. It might be paint, carpet, and a backsplash over the original panel, the original roof, and a water heater from the first Obama administration. The defect is not that someone made a profit. The defect is a renovation scope you can audit, because the before-photos still exist and the ownership period is short.

Short ownership is a fact on the deed. "Lovingly updated" is not.

What it is

Typically a purchase and a resale inside one to twelve months, with cosmetic work in between. The useful questions are what was replaced, what was covered, and what was skipped because it does not photograph: roof, sewer lateral, panel, furnace, windows, drainage. Investors who do this well replace the things that kill deals. Investors who do this badly replace the things that show on a phone. You are distinguishing those two, not moralizing about investors.

FHA has a flipping rule: if the seller has owned the property for 90 days or less, the loan is generally ineligible, with limited exceptions, and between 91 and 180 days a second appraisal can be required when the price jump is large. Conventional loans are looser and still get nervous about sudden value. Know which loan you are using before you fall in love with a house that closed last month.

How to spot it in the listing

Deed date and prior sale price, which most listing portals show. A 40 percent jump in five months with new photos and the same floor plan is the pattern. Then use the old photos. The Street View and photo history shows the roof, the windows, and the siding. If those did not change and the inside went from 1978 to gray vinyl plank, you know the budget. Permits tell you whether the "new kitchen" included electrical or just cabinets. No mechanical permits on a full interior renovation is a finding.

Remarks: "turnkey," "no work needed," "rent-ready," "investor-owned." None of those sentences are a home inspection.

How to spot it at the showing

Look at the edges, not the staging. Paint on the hinges and the outlet covers, cabinet filler that does not fit, caulk as a finish material, a new vanity on old supply lines, a new floor that stops at a door the seller hopes you will not open. Open it. The utility room is the room flips forget. Read the furnace and water heater dates. Look at the panel. A new range hood on a Federal Pacific panel is the whole thesis of a bad flip in one wall.

Ask for invoices. A good flip has them, organized, because they are also the seller's cost basis story. A bad flip has a receipt for the flooring and a shrug about the roof.

The real risk

You pay retail for wholesale work, and the items that fail in year two are the ones that were never in the scope. Cosmetic defects are annoying. A new tub on a rotten subfloor, or a painted foundation crack, is the expensive version. Old listing photos sometimes show the crack, the stain, or the double-pane window that is now "replaced" with a film.

Insurance and lending

Insurers insure the house that exists, not the renovation story. An old roof is still an old roof after the interior is gray. See old roofs and hail if the exterior did not change. Lenders apply the FHA flip rules when the loan is FHA. Appraisers have to support the new price with comps of renovated houses, not with the investor's spreadsheet. If the appraisal gaps, that is the market commenting on the flip. Do not bridge a fantasy gap with your cash unless the inspection says the work is real.

Typical cost ranges

There is no single flip repair number. Price the skipped systems, not "the flip." Typical ranges, not quotes, for the things bad flips skip, are the ranges on the other pages: roof, panel, sewer scope, HVAC, water heater. A contingency budget of one major system is the practical planning number when the exterior and the mechanicals are original and the interior is new. If two or three of those are due, add them. Do not invent a five-figure "flip discount" with no scope. That is as sloppy as the renovation.

A pre-drywall inspection is impossible after the fact. What you can still buy is a normal inspection that is suspicious on purpose, plus the sewer scope and the roof if age is unknown.

Pass, negotiate, or investigate

Investigate every resale under a year old as if the pretty photos are an argument. Pull the old listing. Read the dates on the machines. Negotiate when you find specific skipped work and you have prices. The fact that the seller is an LLC is not, by itself, a discount. Pass when the ownership period trips your loan program, the appraisal cannot get there, or the inspection shows covered-over damage and the seller's answer is that the house is being sold as-is with no invoices. As-is is allowed. As-is at a renovated price is the pass. Listing language that says "painstakingly remodeled" still needs a permit list.

Flipped Houses: Fresh Paint, Short Ownership, and What Got Skipped