HOUSINGNEWS REPORT
MY TAKE
TECH PUTS A NEW SPIN ON FIX-AND-FLIP FINANCING BY NAV ATHWAL, FOUNDER & CEO, REALTYSHARES.COM
Residential real estate investment is going through a period of resurgence. Single family home and condo flips hit a six-year peak in the second quarter of 2016, with 51,434 projects completed. That represents a 14 percent increase over the previous quarter. The number of investors flipping homes reached its highest level since Q2 2007. interest rates and a favorable lending environment have allowed developers and operators the opportunity to raise capital affordability, but it has been a rise in new real estate tools and technology that has played a pivotal role in this growing trend. Old School Fix-and-Flip Financing A decade ago, the landscape for financing fix-and-flip projects was relatively barren. There are a lot of factors that have investors making a return to flipping. Low
Investors had a limited number of avenues available for purchasing a rehab property.
Nav Athwal
Coming to the table with the full amount of cash in hand was one option. In 2006, at the peak of the housing bubble, the average home was selling for just over $230,000 . Pulling together that kind of funding may have been challenging for the typical individual investor, even in light of how well the economy was doing prior to the market’s collapse. A conventional mortgage loan would have been an alternative but then, as now, banks are more focused on owner-occupied properties. Even if an investor were to be approved for bank loan, the wheels of conventional financing have a tendency to move slowly, putting them at risk of losing the property to another buyer.
Nav Athwal is the Founder and Chief Executive Officer of RealtyShares. Nav has over a decade of experience in real estate as an attorney, broker, and investor. Nav lectures at UC Berkeley Law School and the Haas School of Business. He is a frequent contributor to Forbes, and is often featured on CNBC, Bloomberg and Fox Business.
ATTOM Data Solutions • P10
Made with FlippingBook Online newsletter