Caast members for the Orlando-based cable show “Zombie House Flipping” say it’s become tough to find the kind of abandoned foreclosures that made Central Florida somewhat infamous a few years ago.
Two years after Orlando led the nation for having the greatest share of distress home sales; dank, moldy houses owned by banks still haunt some neighborhood streets but they are disappearing quickly and commanding fast-rising prices in a market where flipping has gained popularity.
“In 2009, no one wanted to be involved in flipping. They thought there was no bottom to falling prices,” said cast member Peter Duke. “Now you turn on the radio and hear ads with someone saying, ‘Flip houses with someone else’s money.’ ”
Orlando drew A&E Network’s zombie flipping show early last year and inspired the critically acclaimed film 99 Homes two years ago. Those productions came on the heels of Orlando ranking tops in foreclosure activity repeatedly from 2010 to early 2016. During that time, houses with overgrown yards, stripped-out appliances and moldy walls dotted streets from Avalon Park to Windermere.
Times have changed for real estate flippers seeking to make a buck picking up cast-away houses, fixing them up and selling for a profit. Flipping was at its height in Metro Orlando last summer when 1,041 houses were resold within six months of a prior sale — more than doubling since 2009, according to Attom Data Solutions. Earlier this year, Orlando flips slid to 837.
Orlando market changes have shifted pressures for producers of the zombie house-flipping show.
“The cast has taken on much larger, riskier and more costly renovations,” said a spokesperson for Pilgrim Media Group. “The homes this season were in far worse condition and required far more work. They also had many more setbacks since the renovations were larger this time around.”
Orlando-area flippers sold their renovated houses for a median of $55,000 more than they paid for the properties for just six months earlier or less, according to Attom Data’s first-quarter numbers. But rising home prices, higher labor expenses and rising materials costs have cut into profits with flippers’ return on investment edging down to 48 percent in the first quarter from a high of 59 percent seven years earlier.
Orlando real estate agent and investor Scott Wagoner, who has been flipping houses in the Central Florida area since 2003, said he sees this group of buyers picking up houses further out from the Orlando area and in cities such as Sanford and Deltona.
When asked what might lie ahead, he gave a heavy sigh.
“At this point, I think you’re almost speculating. Is the market crash coming? If you look statistically through the years, you would think it was coming,” he said, adding that the market at least isn’t propped up by faulty mortgages as it was a decade ago.
In the Orlando neighborhood of Delaney Park, zombie cast member Duke said costs have increased so much that he could make almost as much profit by fronting loans to other flippers and collecting interest. He said he was selling his own portfolio of two or three houses.
The show’s crew scours real estate listings and streets looking for a deals on cast-off houses that could be transformed into prime properties. Cast member Keith Ori recently found a listed house with a “walking dead” vibe in a transitioning neighborhood near Wadeview Park south of downtown Orlando.
Built in 1952, the 2,000-square-foot house had been the longtime home of a now-deceased woman. Sitting in a living room window was the home’s only air conditioner unit. The ceiling of one room had partly caved in years ago. Sheets of clear plastic draped under the ceiling to catch rain. The bathroom floor had partially collapsed. And floors throughout were strewn with old cardboard boxes, broken dolls, dishes and torn lampshades.
“Disney couldn’t make up something this good for its Haunted Mansion,” Ori said as he walked through the house and pulled a dust-caked light fixture down from the ceiling.
The showstopper, he said, was the asking price.
The $290,000 list price was about $70,000 higher than the Orlando Regional Realtor Association’s midpoint sales price in May. Ori said a home in that condition and neighborhood would have brought less than half the listing price amount two years ago.
Last week, it had an offer pending.