HOT!! Effective Feb 1st FHA Suspends Anti Flipping Rule For 1 Year!
ByI was going to try and do something lofty here for my first post but this is huge!!!
On Feb. 1, the Federal Housing Administration will place a one-year moratorium on its anti-flipping rule, which will allow buyers with FHA-backed loans to purchase homes that have been held for less than 90 days, officials said Friday.
The move will open a new pool of homes to first-time homebuyers who have been losing bids to cash buyers, but shouldn’t have much effect on home prices, analysts said.
“Opening up to FHA buyers means an investor who buys a home for cash can sell it to anybody. That’s huge advantage to buyers, sellers, investors and our economy.
FHA buyers made up a very high percentage of buyers in the Greater Kansas City Area with the FHA Loan Limit at $271050. I estimate that it is over 60% of the buying market right now. This is not verified.
Cash buyers take up much of the rest of the market, and many of them are speculators and investors. The new rule will connect the two groups.
“Give the consumers as many options as possible,” said Nathan Moeder, a real estate economist with the London Group. “Someone who’s buying an investment property to flip it, isn’t buying a junk property where there’s holes in the walls. From the consumer side, I’d be happy about that.”
The new rules limit seller’s profits to 20 percent above the purchase cost, unless an independent appraiser confirms that renovations and repairs justify the higher price.
This move will grow the number of transactions in coming months: More buyers for investors will motivate investors to buy and renovate more houses.
You can Google 24 CFR 203.37a(b)(2) and it will take you right to the page or close.
Now if HUD opens up the FHA 203k back to investors that would even be a better deal!
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Steve Hillyer
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