Builders Create New Ways to Stop the Flipping of Phoenix Properties

StarPointe Properties, an Arizona developer, is just one of many builders that has gone to great lengths to protect its Phoenix properties from Flippers.

Flippers are real estate investors and speculators who flip Phoenix properties, "that is, people who buy a house or condominium for the sole purpose of quickly selling it off for profit, usually before construction is completed and often without even taking title to it."

Developers believe that investors are "distorting the market" and artificially raising the price of Phoenix properties. The National Association of Realtors seems to agree with developers, pointing out that "investment homes," which used to be only a fraction of the market, "made up almost a quarter of home purchases last year. It´s one reason why U.S. home prices have lept 50 % since the 1990s."

Now many developers work "anti-investor claims" into their contracts and demand that the buyer occupy the house. Others limit the number of units each person can purchase, and StarPointe requires "investors to close on (and take title to)" the Phoenix properties they buy. Some big time, national builders are even demanding "that the homebuyer forfeit the profit if selling a home before the minimum period of one year (except for harship reasons)."