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I don't think there's a strict definition of flipping. What's happening here is much closer to flipping than arbitrage for any sensible definition of those.
by buzzdenver 11y ago
I don't think there's a strict definition of flipping. What's happening here is much closer to flipping than arbitrage for any sensible definition of those.
- biot 11y agoMy understanding of flipping was what I thought to be a common-sense one. However, upon researching it further I stand corrected: https://en.wikipedia.org/wiki/Flipping#Wholesaling_and_assigning_a_contract https://en.wikipedia.org/wiki/Flipping#Wholesaling_and_assig... One part of that article that stands out is that this is possible because the seller is generally not getting market value, which implies that the seller's agent isn't doing a great job of representing them: "This practice is often frowned upon in the real estate community since it seems unethical or illegal. In practice there is nothing illegal about wholesaling or assigning rights to a purchase contract even if it is multiple times. It is important to understand that the reason there is an opportunity to wholesale is because the original seller is selling the property for substantially less than market value."