Accordng to the News & Observer, North Carolina-based Groundfloor is coming to the Charlotte real estate market with $10 million to invest in the house-flipping business. Loans will be offered to developers or amateurs to buy, renovate and sell homes in a hot real estate market. According to Attom Data Solutions, the number of homes flipped in the Charlotte region reached an all-time high in the second quarter this year, at just under 1,200.
Profits from flipping homes are slipping but the practice remains more popular than ever in Charlotte, with startup and other companies now lending to eager renovators. Brian Dally, the company’s CEO and co-founder, said the lack of housing inventory in Charlotte is part of why his firm decided to expand its presence in the area. For first-time buyers especially, a recently renovated home is typically less expensive than newly-built houses, Dally said.
Still, flipping a house is often not as simple as it looks on TV — or as lucrative. Profits from the practice are on the decline, Attom’s data shows, as housing and renovation costs rise. And consumer advocates like the Better Business Bureau caution that the expenses are often higher than many people anticipate.
Dally started the company, his goal was to give everyday investors a chance to put their money in real estate. He’s offering the same to Charlotte investors, who can put up a minimum of $10 into specific properties. The company says the average return is between 10% and 12% within a year.
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